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One in a Thousand
The most often asked question by those thinking about getting into the tech investment sector is “what can I expect my success/failure/return rate to be?”. That question is in the same crystal-ball-gazing category as which lottery numbers should I choose or which horse is going to win the National. There are lots and lots of statistics how many tech startups make it and how many don’t and why this is so. And given that statistics don’t lie, it was interesting to see an analysis conducted in the US which showed that if you really want to make some money, that is, be part of a startup which ends up being valued at over $1bn, then your chances are worse than 1 in 1000 (it’s actually 1 in 1480).
Now, there are lots of assumptions around this sort of figure – why choose $1bn as the benchmark and so on – but it does show that if you’re intending to be (or to meet) the next Mark Zukerberg, then you’d be doing better to be playing poker with no talent whatsoever and simply waiting for a full house (1 in 693). In fact the chances are worse than that because most successful entrepreneurs are not college drop outs (despite what the movies portray) and have worked with other entrepreneurs before and are over 30.
You’re better off waiting for a straight flush (1 in 72,192).