odds that your tech startup will become worth $US1 billionor more are vanishingly small, according to research done by Aileen Lee, a founder of Cowboy Ventures, a seed-stage investment fund.
They’re so tiny that Lee calls $US1 billion startups “unicorns.” And you’re not getting into the Unicorn Club any time soon.
Previously Lee worked at Kleiner Perkins Caufield & Byers, the venture capital fund — so she knows what she is talking about.
Only 39 companies have reached the $US1 billion valuation mark, Lee says, or just 0.07% of tech startups, Lee writes in TechCrunch:
- We found 39 companies belong to what we call the “Unicorn Club” (by our definition, U.S.-based software companies started since 2003 and valued at over $US1 billion by public or private market investors). That’s about .07 per cent of venture-backed consumer and enterprise software startups.
- On average, four unicorns were born per year in the past decade, with Facebook being the breakout “super-unicorn” (worth >$100 billion). In each recent decade, 1-3 super unicorns have been born.
She also notes that $US1 billion startups tend not to come from 20-somethings like Mark Zuckerberg. They’re more likely the product of experienced founders in their mid-30s.
Read her full report here.
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