Quantifying Startup Quantity for More Ecosystem Success

David Cummings on Startups

One area I spend a good bit of time thinking about is how to get more tech startups to a modestly sustainable level of success (e.g. $250k in run rate) as well as to a more sustainable level of success (e.g. $1 million in gross margin). As a community, we need more entrepreneurs taking more at-bats to get more hits, and more homeruns. Let’s assume we have a community goal of onenew sustainably successful tech startup ($1 million in gross margin) per month (12 per year), how many companies need to be started? Here’s a guess:

  • 100 tech startups start
  • 10 achieve $250,000 in revenue within three years
  • 2 achieve $1 million in gross margin within five years

According to this survey, only 4% of all business have $1 million or more in revenue, so it feels directionally correct that getting a tech startup to $1 million…

View original post 76 more words

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s