> and the high chance a startup fails in its first one or two years.
I never understood why people like to spread this "fact" around. Of course a company will fail in it's first years, if not, it's a company that is at least not failing.
Also, it means nothing, not all companies are started equal and these statistics mix everything and everyone in the same basket, there is too much noise involved for this metric to mean anything.
Because if you're on the VC funding train then you are almost guaranteed to fail in the first 2 years.
Why ? Because your Seed Round is only going to get you 18 months runway before you will need to raise a Series A. But VCs don't tell founders enough that the chances of that are in the single digits.
And so you get these founders with a company that is unprofitable and growing well but not growing well enough to get more funding. Which then means the company dies.
I could never take VC money. VCs and reasonable founders have very different definitions of success. A reasonable founder may say that 15 employees and revenue of 5M and profit of 1M is a huge success. A VC may say that 1M profit is bullshit. They could have made 1M profit investing in index funds.
Due to the increased difficulty of attaining certain milestones, there has been the gradual increase and acceptance of more than one funding event occurring at Seed; ie Seed 2, Bridge, Post Seed. All before an actual Series A event.
Not disputing that VC's (and others) should do more to highlight the difficulty, the slim chances, the demanding road both professionally and personally, that maximised exit valuation need not mean profit-making, nor revenue-generating, need not even mean sustainable if not propped up, nor some other things which would make my response off-topic.
I never understood why people like to spread this "fact" around. Of course a company will fail in it's first years, if not, it's a company that is at least not failing.
Also, it means nothing, not all companies are started equal and these statistics mix everything and everyone in the same basket, there is too much noise involved for this metric to mean anything.