The end of the year is almost here, so it's time to look back at some of the biggest stories from the Boston tech scene in 2017.
Our list this year includes the end of DraftKings' merger plans with FanDuel, Jibo finally releasing its social robot after years of delays and CarGurus' IPO.
Think we're missing a story in here? Let us know at dmartin@americaninno.com.
DraftKings-FanDuel merger falls apart
Several months after DraftKings announced its plan to merge with New York competitor FanDuel in November 2016, the deal fell apart in July. The decision by the two larger providers of daily fantasy sports contents came a little over a month after the Federal Trade Commission filed a lawsuit to block the merger, citing anticompetitive concerns. At the time the two companies called off the merger, sources told Fortune that DraftKings and FanDuel didn’t want to go through another lengthy and expensive legal battle, which they had already experienced multiple times over challenges to the legality of daily fantasy sports. DraftKings CEO Jason Robins told Bloomberg Radio last month that the company is now “marching towards an IPO path,” though he did not say when it would happen.
CarGurus IPO highlights Boston’s consumer clout
After 10 months with no tech IPOs in Massachusetts, CarGurus broke the dry spell in October with a $150 million initial public offering. The day the online automotive marketplace debuted on the stock market, the company’s stock price jumped roughly 80 percent above its IPO price of $16 per share. The Cambridge-based company then followed with solid financial results in its third quarter in November. There were a few notable things about CarGurus’ IPO: it was for a consumer company in a city that is mostly known for its enterprise clout, the company was already profitable, and it managed to grow for several years with only $5 million in funding.
SoftBank’s influence in Boston grows
While Japanese tech giant SoftBank has already had an interest in multiple Boston tech companies, the company made its biggest local moves in 2017 with its acquisition of Waltham-based robotics company Boston Dynamics from Alphabet and its $100 million investment in cybersecurity startup Cybereason.
Massachusetts makes bid for Amazon HQ2
The City of Boston and several other cities in Massachusetts are hoping that the region can repeat its success of wooing General Electric with their bids to become the home of Amazon’s second headquarters. The state’s bid includes 26 potential sites, including areas in Everett, Lynn, Westborough and Quincy, though the city of Boston itself has reportedly been touted as a top choice for some top Amazon executives. Amazon announced an open bidding process in September for its second headquarters, dubbed HQ2, which is expected to create 50,000 jobs as part of $5 billion investment. The company has received 238 proposals from cities and regions in 54 states, provinces, districts and territories across North American.
New unicorns are born
The Boston tech scene gained two new unicorns in 2017 — that is, companies with a private valuation of at least $1 billion. Desktop Metal, a metal 3D printing startup, joined the club with a $115 million Series D round in July from New Enterprise Associates, GE Ventures, GV and other investors. A couple months later, agtech startup Indigo became a unicorn with its $156 million Series D round.
Self-driving car startup nuTonomy gets acquired
After becoming the first company to launch a self-driving taxi pilot last year, Cambridge-based nuTonomy announced in October that it was getting acquired by auto parts manufacturer Delphi for up to $450 million, become of the few autonomous vehicle startups to get acquired this year. The company started testing its self-driving car technology in the Seaport late last year, and it’s now testing a passenger pilot with ride-hailing company Lyft.
LogMeIn completes merger with Citrix’s GoTo business
LogMeIn completed its $1.8 billion merger with Citrix’s GoTo business in February, becoming one of the world’s top 10 software-as-a-service companies in terms of revenue. While the company has been on an eight-year streak of beating Wall Street’s expectations for every quarter, the company has had to make some tough decisions this year, namely layoffs that impacted roughly 200 people as part of a $100 million cost-cutting initiative.
Jibo launches social robot after multiple delays
Following roughly two years of delays after a $3.6 million crowdfunding campaign, Jibo finally released its much anticipated, namesake social robot in October for $899. While the robot made the cover of Time for the magazine’s best inventions of 2017 and has been praised for its human-like interactivity, the robot has also been panned for having significantly less functionality than voice assistants like Amazon Alexa. The company has promised that the robot will gain more capabilities over time.
MIT launches The Engine
The Massachusetts Institute of Technology in September launched its $200 million venture capital fund and named the first seven startups participating in its high-tech accelerator. The Engine, which aims to fund resource-intensive, high tech startups that need more runway before commercialization, was unusual for a couple reasons: it was started by a higher education institution, with MIT committing $25 million of its own capital, and the fund’s lifecycle will be several years longer than a traditional venture fund. The firm is led by Katie Rae, a former partner at Project 11.
Upheaval at GE and athenahealth
After making Boston its home last year, General Electric has been making a local course correction as part of a major cost-cutting initiative that includes mass layoffs and the divestment of various businesses. While Boston wasn’t hit as hard on layoffs, the company announced that it plans to sell off Current, one of its local subsidiaries, and that it would delay completion of its headquarters by two years. Athenahealth, another large public tech company in Boston, has also been making layoffs and changes to its business after activist investor Elliott Management took a major stake in the company.
