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Posted On May 16th, 2017 by Crowded Ocean

Building a startup: ten startling facts

High growth startups are very different from other businesses. And they die remarkably young. In fact, nine out of ten startups fail within their first 24 months of operation.

Since our founding in 2008, we’ve worked with more than 50 companies and 45 startups. What makes startups so unusual? Let’s take a closer look:

  1. 25% of startups were started by immigrants  Source: Reuters, 2016
  2. By 2013, the median time to IPO was 7.4 years  Source: NVCA, 2014
  3. By the time startups raise the third round of financing, 52 percent of founder CEO’s have been replaced  Source: New York Times, 2012
  4. More than half of U.S. unicorns – startups valued at $1 billion or more – have at least one immigrant founder  Source: Wired, 2016
  5. VC firm Andreessen Horowitz funds about 20 startups a year out of 2000 warm referrals  Source: The Macro, 2016
  6. The Y Combinator accelerator is more exclusive in its acceptance rate than Stanford University  Source: The New Yorker, 2016
  7. Only 20% of the Inc 500, the fastest growing private companies, raised outside funding  Source: The New Yorker, 2016
  8. Americans in their 50s and 60s make up a 24.3% share of entrepreneurs who launched businesses in 2015, up from 14.8% a decade ago. And, 70% of startups founded by people age 50 or older last longer than 3 years, versus 28% for those younger than 50  Source: Wall St. Journal, 2016
  9. The majority of startups die after an average of 20 months and $1.3 million in financing  Source: New York Times, 2016
  10. In a 2016 survey of 700 founders, 31% said they didn’t intend to IPO and 69% expected to be acquired  Source: First Round, 2016