Early investment in the Post Crisis Era did startups get hurt

20 years ago, people believe that the establishment of a start-up is low cost. Infrastructure and other factors of the open source framework, on-demand cloud computing (the prototype of the rapid development of technology, 3D printing, manufacturing progress, material science more popular into the field of hardware etc.) greatly reduces the establishment of a startup software company cost.

now the construction of basic technology may be more low-cost and convenient. But how can startups build an overall business? There are many ways to answer this question, but we will focus on those who may get A round of financing seed and angel wheel startups. In the past ten years, most startups will seed and angel round of financing for the construction of the first iteration, the first employment technology and business core team members, some marketing experiments, and finally get the enough attraction to the A round of financing to promote sustained growth.

If the

is now set up a startup than ever lower cost, then the contrast in the past few years the amount of financing about the company, we will find that the seed round of financing amount smaller startups are more likely to get A round of financing.

next, let’s take a look at

startups in a period of time the survival rate of

in order to answer this question, we used data from more than 4 thousand and 400 U.S. companies, these companies carried out between 2004 and the end of 2014 angel or seed round financing. We filter out the capital intensive industries, such as life sciences, petrochemical exploration and hardware industry, we did not calculate those companies in the A round of financing less than 25000 U.S. dollars of funds.

finally, we divide the data set into two different time periods:

1.2004 years during the -2011 seed / Angel wheel financing start-up company

2.2012 years during the -2014 seed / Angel wheel financing start-up company

we exclude 2015 and 2016, because the company is now too short to be a mature sample data.


the final analysis results tell us:

1 is now more expensive to start a startup

in the $4 million financing for start-up seed and angel round of financing amount is high, A round of financing success rate increased steadily. In other words, the relative success of these relatively new companies in seed and angel round financing is positively correlated with future financing success. (see the blue and red histogram histogram)

2 is too much money "spoiled" a lot of start-up companies


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