The Wall Street Journal has come out with its second annual list of the top 50 venture-backed companies, 30 of which — and seven of the top 10 — are located in the Bay Area.

No. 1 on the list is Castlight Health, based in San Francisco, and No. 3 is Xactly Corp., from San Jose. Castlight makes “web-based software that gives employees personalized views of medical benefits and treatment costs.” Xactly makes “web-based software for managing sales compensation.”

Criteria for eligibility on the list:

To be eligible for the ranking—compiled by research firm VentureSource, a unit of Wall Street Journal owner News Corp.—companies must have received an equity round of financing in the past three years and be valued at less than $1 billion, as the aim is to identify lesser-known contenders. That excludes a number of prominent companies, including Facebook, Twitter and Groupon Inc. Some 5,743 candidates were considered.

Criteria used to rank the companies:

• More money is better: A firm with more capital to deploy than its competitors will have an advantage.

• Growth is good: Companies with higher valuations for their equity are more successful than smaller ones.

• Intangibles abound: Company success can’t be reduced to an equation.

All of that is explained in this Journal video.

So how accurate is this list as a predictor of the next Google, as opposed to the next Well, since this is only the second year, hard to say. But last year’s crop of companies included Zynga, the San Francisco-based social gaming company that is now valued at anywhere from 5 to 10 billion (depending on how many Facebook Farmville updates get sent out on any given day, I guess), and, which was sold to AOL last month for $315 million.

Bay Area Dominates Wall Street Journal List of Top 50 Startups 10 March,2011Jon Brooks


Jon Brooks

Jon Brooks is the host and editor of KQED’s health and technology blog, Future of You. He is the former editor of KQED’s daily news blog, News Fix. In 2014, he won a California Journalism Award for his coverage of ride services like Uber and Lyft and the taxi industry. A veteran blogger, he previously worked for Yahoo! in various news writing and editing roles. Jon is also a playwright whose work has been produced in San Francisco, New York, Italy, and around the U.S. He has written about film for his own blog and studied film at Boston University. He has an MFA in Creative Writing from Brooklyn College.

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