Startup Accelerator Fail: Most Graduates Go Nowhere

Post by raverbashing » Thu, Jun 21, 2012, 7:25 PM UTC

snambi wrote: post #17

pg wrote: post #11

Exits are a stupid test for what they're trying to measure here. By that standard, Airbnb and Dropbox are failures. Exits are a reasonable test for investments made, say, 10 years ago. But none of the incubators are that old yet. So the right way to judge them is by the valuations of the startups they've funded. Unless the venture business as a whole loses money, that will be a lower bound on the eventual exit number…

If the startup is profitable and self sustain itself, does it count as success or failure?

Post by rudiger » Thu, Jun 21, 2012, 7:52 PM UTC

pg wrote: post #33

michael_fine wrote: post #26

Earlier quoted context omitted.

Isn't measuring by average valuation a little dissonant with how the valuations play out? If startup valuations follow a power law, and most of the money is made from a few successful exits, wouldn't it make more sense to judge incubators by say, their top 10%, while also showing the total number of startups for comparison?

If you're measuring them as investors, you want the average, because if (as all these incubators do) they invest roughly the same amount in every startup, then average is money out divided by money in.

Post by Evbn » Thu, Jun 21, 2012, 8:14 PM UTC

waterlesscloud wrote: post #38

TimGebhardt wrote: post #29

Earlier quoted context omitted.

But VC investing is a hit-driven business. One big hit, like a Dropbox, funds all the rest. Unless you're really good at picking horses, you'll have the same median as everyone else.

But success for purposes of a median is a low bar. It's half your companies having any valuation at all.

Post by pg » Thu, Jun 21, 2012, 9:00 PM UTC

snambi wrote: post #35

pg wrote: post #21

Earlier quoted context omitted.

To the algorithm they use in this study, it counts as a failure unless the company is public, which is my point here. To investors, whether an investment is a success or a failure is indeterminate till the company either goes out of business or returns the capital invested.

when the company is profitable and has valuation, the investors can sell their shares. If the investor makes a profit by selling their shares, will it count still count as failure? It is possible that the investor can lose money, even if the company goes public, right?

Post by chrischen » Thu, Jun 21, 2012, 10:08 PM UTC

pbharrin wrote: post #42

Is it me or was this guy writing to support his investments? He said only three incubators are worth joining: two that he has a vested interest in, and, and, and that other famous one.