Weeding Out Losers

A few days ago David C wrote a post about Quantifying Startup Quantity.

I disagree a bit with the basic premise of the article. More companies is not necessarily better when it comes to growing a startup ecosystem or measuring its success. It might be more fun for lots of people that are playing house. Fun for what Keith McGreggor refers to non-trepreneurs. But its not success.

A better measure of quantity of a startup ecosystem would be the number of people that are employed by technology companies created within the past five years. That’s an interesting number and one that can really nail down the health of a startup ecosystem. It’s a number that you can actually look at to watch an ecosystem grow and the employees in that ecosystem are the ones that might run off and create a company at some point in the future.

Somewhere in our Twitter conversation Keith stated the following.

That someone was me.

For someone with ten years or so of listening to pitches from startup companies and being a very very early participant in the commercial internet industry some type of outlier 10,000 hour pattern recognition has developed for me creating a rapid cognition skill on selecting startups. I am sure I am not alone in possessing this skill set. It takes someone with it about 30 seconds to identify a startup that is not going to make it. I will stand corrected if someone wants to raise their hand and say “what about this one”, but of the thousands upon thousands of startups that I have seen in business development and startup advisory roles I don’t think I have ever been wrong in identifying a startup that would not make it.

This all goes to say that a technology community should focus on startups that have an opportunity to become a business. When you get down to it the real measure of a startup ecosystem is the customer, revenue, and user growth that the companies within it obtain.

Everything else is just a bunch of noise.

July 16, 2015  |  Comments  |  Tweet  |  Posted in Entrepreneurship