Tuesday, June 4, 2013

Dear Entrepreneurs: Here’s How Bad Your Odds Are Of Success

A sobering article from Business Insider highlighting the fact that only a very small percentage of startups actually succeed.


  1. Note that success is defined as selling for more than $40 million and it's from companies that went through YC, which only started in 2005. Entrepreneurs are often serial, that is they startup another venture after their learnings. PwC report a 40% serial founder rate in their The startup economy 2013 report. Entrepreneurs that went through YC and closed down said business could be running another very successful startup / working for another very successful startup.

    I'd challenge the singular definition success.

    1. That's a good point Peter, I'm on startups 4 and 5 with Shoes of Prey and Sneaking Duck after the first 3 (The Brisbane Card, Darwin Dating and Swift City) weren't successful.

  2. Peter you beat me to the punch. While I wont dispute that the odds are stacked, BI's interpretation of "success" would class all of the following as unsuccessful:

    1) a $35m exit
    2) A highly profitable startup (say EBIT of $10m p.a) that the founder doesn't want to exit. Eg NastyGal (had it been a YC company)
    3) any one of the 500 yc companies that will exit in future but have not yet. Especially from the more recent cohorts.

    All the same, the true stats are probably not much different, and equally as sobering, but I feel BI has gone with a sensationalist approach.

    Micheal, I loved the Bonobos posts earlier this week. - (bears & drugs) especially the bears one! Keep it up.
    Wes B

  3. Thanks Michael - you've cheered me up no end! :)