Startup Founders Should Expect 10 or More Years to Build

Startup founders should expect to be building their companies for 10+ years.

If you're able to get to an IPO, sure, that makes sense. But many, many founders have spent a decade building companies that won't end up on the NASDAQ.

Check out the chart below. It shows the percentage of companies in a current stage by the year they were founded. The orange bars indicate the halfway point in terms of founding dates (so for Seed stage, more than 50% of companies currently at Seed were founded 2021 or later).

𝗜𝗻𝘁𝗲𝗿𝗲𝘀𝘁𝗶𝗻𝗴 𝗙𝗶𝗻𝗱𝗶𝗻𝗴𝘀

• You can see the decline in funding in most stages in recent years after the bubble funding period of 2021 passes.

• Founders are SO persistent. Wild that there are still Series A companies around that raised their A rounds in 2012(!). I hope most of them have gotten to profitability and simply don't need VC funding, but I worry that some are still just muddling along.

• The chart as a whole gives some idea of why VCs focus so much on speed. Rapid growth is absolutely necessary to avoid becoming a part of the long tail.

• Look at how recent ChatGPT and the explosion of AI is for most stages. The pivot from low interest rates to high interest rates in 2022 PLUS the introduction of a major new technology...whiplash for slightly older companies.

• IPO and M&A can't be the only liquidity sources. It just takes too long. Here's to a lot of folks experimenting with new models of secondary to inject some much-needed cash into this process.

Respect as always to the founders making it happen!

#startups #founders #VC