30 July, 2016
CB Insights have come up with another fine piece of statistics. Based on the 2009-2010 vintage (a long enough period of time to allow companies to succeed or fail), their team have looked at startup failure rates and showed that only 40% of those who could get seed funding, made it to the 2nd round. Getting a 3rd round is a lot easier after that, but still only 23% get to that stage.
Out of 1027 companies:
* 225 (22%) of companies that raised seed in 2009-2010 exited through M&A or IPO within 6 rounds of funding.
* 9 (0.9%) that raised seed in 2009-2010 reached a value of $1 billion or more including internet sweethearts Instagram, Uber, and Slack (who?).
* 790 (77%) of companies are either dead, walking dead, or became self-sustaining (a potentially good thing for the company, but probably not for the investors