What makes certain startups succeed and others fail? If we there were a roadmap to startup success, it would be a bestseller. Yes, it starts with a great idea, but beyond that, there are countless contributing factors, from the state of the economy to the uniqueness of the product to marketing. Really there’s no right answer. But in his 10 years as a partner at First Round Capital, Josh Kopelman has discovered a few distinct commonalities in companies in his portfolio that have performed exceptionally well. Read on for the four types of people he finds to be an asset, plus one more important commonality.
1. Companies with females founders win. “Our investments in companies with at least one female founder were meaningfully outperforming our investments in all-male teams,” Kopelman says. “Indeed, companies with a female founder performed 63% better than our investments with all-male founding teams.
2. Young founders excel. Fortune favors the young, as it turns out. “Founding teams with an average age under 25 (when we invested) perform nearly 30% above average,” he says. “And while the average age of all our founders is 34.5, for our top 10 investments the average age was 31.9.
3. Ivy Leaguers are good to have around. Kopelman found that his teams with at least one founder who went to a top-tier school—defined as the Ivy League, plus Stanford, MIT, and Caltech—performed the best, specifically 220% better than other teams who did not a top-schooled founder.
4. A buzz-worthy resume can have real impact. Companies in Kopelman’s portfolio with founders who’d previously worked at Amazon, Apple, Facebook, Google, Microsoft, or Twitter “performed 160% better than other companies,” and were also valued much higher before they got funding. He cites “the impact of embedded networks” and “foundational skills these types of jobs,” as factors that could have really impact on the success of a company.
5. Teamwork works. No matter how talented, intelligent, and wise you are, building a strong team is essential, Kopelman finds. “Teams with more than one founder outperformed solo founders by a whopping 163%,” he says. That said, rounding up a whole bunch of founders to start your company won’t necessarily be better for you: Kopelman says two is the optimal number according to his data.
Visit LinkedIn to read about some other lessons the venture capitalist learned in his 10 years investing in startups.
Interested in learning more about startup success? Pick up a copy of Peter Thiel's book Zero to One.
Have you found anyone of these to be true in your experience? Tell us in the comments.