Facebook’s Purchase of Parse Is Good News for Ignition Partners

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Providing what appears to be a sizable exit for Ignition Partners and other venture firms, Facebook on Thursday acquired startup Parse Inc., which offers a cloud-based mobile application platform.

The deal was announced in a blog post by Parse CEO Ilya Sukhar.

The price tag wasn’t disclosed, but TechCrunch is reporting that Facebook will pay $85 million, not counting the cost to retain staff.

At that price, Parse’s backers will see a meaningful return on their investment. The company has raised just over $7 million in venture capital, according to an SEC document filed on Nov. 9, 2011. The filing does not name the investors in the round.

Parse raised $1.64 million on Oct. 21, 2011, in a Series A round from Yuri Milner’s Mail Ru Group Ltd. (via DST Global II), Google Ventures, Ignition (Ignition Venture Partners IV), Menlo Ventures (unspecified fund), Ron Conway’s SV Angel fund and Y Combinator, according to Thomson Reuters (publisher of peHUB).

Parse subsequently raised $5.5 million from Ignition in a Series A funding round in early November 2011, according to TechCrunch. TC’s CrunchBase described the previous funding as an “angel” round, but the SEC filing suggests that all of the investments were part of the Series A.

The exit is particularly good news for Ignition, which this year reduced the size of its partnership and set out to raise a fifth fund that was less than half the size of its fourth. The firm earlier this month announced that it had closed on $150 million for fund V, down from the $400 million it raised in 2007 for Ignition Venture Partners IV.

Ignition backed Parse from fund IV, with Partner John Connors taking a seat on the company’s board as part of the deal. It is unclear what impact the exit will have on that fund’s performance, as peHUB was unable to find publicly available return data for fund IV.

Connors said in the announcement of fund V that the firm had made “approximately $450 million in distributions in the last 12 months, [and] our firm has strong momentum going forward.”

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