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America’s typical tech entrepreneurs are in their 20s. It seems to me that media is absolutely in love with this notion. The scrappy, brilliant kid who's going to change your world (e.g. Diaspora). Why is that?
I think another myth is that the majority of companies are started in the Bay Area. That might be true for tech, but for entrepreneurship overall in the U.S. I bet the Bay accounts for 10-15% tops.... does anyone have numbers? (I'm searching, but if you read regularly and have found some numbers please let me know)
Earlier quoted context omitted.
Everyone loves the story of the overnight success. No one wants to read about a 10-15 year struggle, with liberal doses of failure and setback. They'd rather read about someone who had a 'light bulb' moment and cashed out six months later. The reason is perhaps that everyone likes to think they too can do it - if amazing success is available almost overnight to other people, why not to them. Not as cool to dream abou…
"Everyone loves the story of the overnight success... the reason is perhaps that everyone likes to think they too can do it..." Perhaps it's the opposite. If they turn founders into mythical characters, then it's much easier to disregard the idea of ever starting a business. They don't have to take responsibility for their own lives or accomplishments.
The key is really the misleading definitions at the beginning. He includes what we'd call lifestyle businesses as startups. Is a new carpet cleaner a startup?
Publish the raw data, Vivek, with the actual names of the businesses, their founders, their market caps, their sectors, and their revenue growths in a single publicly accessible, read-only Google Spreadsheet.
Because my feeling is that the actual businesses selected will differ strongly from the kinds of operations peoe on Hacker News are concerned with: Google, Facebook, Adobe, LinkedIn, Apple, Twitter etcetera, and the kinds of companies they acquire.
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Edit: here's the original study
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1431263
Note that this is a survey of 549 respondents across twelve industries. First, that is a relatively small sample to slice and dice on multiple axes simultaneously, though you can compare each attribute to the population at large.
More importantly though it is not a rank ordered survey within those industries. For example, identify the top N most profitable companies started in the last T years in the hardware sector, for different values of N and T. Who are their founders? What are their characteristics? They are going to look more like Jen Hsung Huang of Nvidia, another Stanford grad school product, than the demographic profile Wadhwa presents.
Unfortunately, Vivek Wadhwa is being highly misleading here. He publishes a variant of this same article over and over and over again in every forum available to him (see his old TechCrunch posts, for example). The key is really the misleading definitions at the beginning. He includes what we'd call lifestyle businesses as startups. Is a new carpet cleaner a startup? Publish the raw data, Vivek, with the actual names…
Is a new carpet cleaner a startup?
For example I started a company in E.Europe, and here it's not clear at all what process you have to follow to succeed.
You may think that an entrepreneur has to figure that out, but that's not a good way to look at it. A good entrepreneur, since he's already involved in a venture with high overall risks, will minimize individual risks whenever possible. By following a model such as the YC/SV model, where he is advised, maximizes the inflow of information about his idea/BP etc, he can achieve that.
I read few weeks back in Y Combinator FAQ page that the average age of Y Combinator funded entrepreneurs is 26. Vivek's survey found the average age of founders to be 40. It would be interesting to know the average age of Y Combinator applicants.
Unfortunately, Vivek Wadhwa is being highly misleading here. He publishes a variant of this same article over and over and over again in every forum available to him (see his old TechCrunch posts, for example). The key is really the misleading definitions at the beginning. He includes what we'd call lifestyle businesses as startups. Is a new carpet cleaner a startup? Publish the raw data, Vivek, with the actual names…
> 4. Women can’t cut it in the tech world.
Vivek throws out this straw man (straw woman?), but other than a rare sexist I don't hear anyone saying that. There may be observations that the number of women in tech is low - and a lot of speculation as to why - but no one's saying women can't cut it.
Unfortunately, Vivek Wadhwa is being highly misleading here. He publishes a variant of this same article over and over and over again in every forum available to him (see his old TechCrunch posts, for example). The key is really the misleading definitions at the beginning. He includes what we'd call lifestyle businesses as startups. Is a new carpet cleaner a startup? Publish the raw data, Vivek, with the actual names…
I could go next month and start an innovative book shop with a wine bar instead of just coffee drinks, but that's why we have the distinct term "startup" to mean a new business likely capable of exponential scaling once it proves product-market fit, the only kind VCs want to plug into, and not just a new small business that is likely always going to stay small or at best grow slowly, that will be fun and might pay the bills but would never be worth outside equity investment.
Wadhwa gives no indication that I could tell that he's made any attempt at that distinction, except in the negative with the very low VC rate of his sample group, and with the claim that they are in twelve "high growth" industries. Twelve entire industries is a pretty broad segment of the entire economy, and doesn't approach the defining distinction of startups.
EDIT TO ADD: his selection criteria were just involvement in any of fifteen (17 except two are listed twice) industries indicated as high-growth, and which include for example "engineering consultants", "health care facilities", and "audio and video equipment" though a little later it says some of the respondents were also from "other (non-technology)", so it's pretty non-selective. He also defined a "founder" as "an early employee, who typically joined the company in its first year..." so his definition of "founder" is also pretty loosey-goosey. Good thing he cleared up myths about startup founders.
"founders of tech companies tend to be highly educated."
Observing that the majority of successful founders have college degrees tells you nothing about the effect of not having a college degree. If 1% of students drop out, 99% do not drop out, and of the founders from the 1%, 80% are successful and from the 99%, 20% are successful, we would still see the vast majority of successful companies coming from non-dropouts.
A very poor analysis published by a man with a pro-education agenda.