Starting a service business need not be risky, but starting a startup seems to be quite risky. From what I've seen so far, the standard urban statistic about the 10% success rate is not hard to believe.
My issue with the 10% rate is that the population of startups is not homogenous. Put differently, many startups are essentially doomed to failure at the time of the founding, and others have much better chances.
If one takes serious measures to belong to that second group of startups which are not (necesarily) doomed to failure, then the really relevant question is: what is the success rate in this group? 25%? A third? A coin flip?
Of course there's also a non-trivial chance of belonging to the first group, but not acknowledging or being aware of it.
Any data of how many founders who fail go start the second startup? I think that probably 90+% startups fail but founders failure rate is probably much lower.
For me definition of founder failure would be giving up and going back to big company and not trying again.
Certainly, though they need not be exclusive endeavors. You can launch a small business with the plan of growing it slowly into a full-blown startup. So you start with the near-term goal of paying your rent and food, and a longer term goal of doing much better. (The whole idea of planning to build a $1B company makes little sense to me. Rather, first build a $100k company, then turn that into a $1M one, then $10M, etc.)
Admittedly, this sort of strategy doesn't work for all kinds of startups, in which case you might start a related small business, and use it as a base to launch startups.
Comments
Starting a service business need not be risky, but starting a startup seems to be quite risky. From what I've seen so far, the standard urban statistic about the 10% success rate is not hard to believe.
My issue with the 10% rate is that the population of startups is not homogenous. Put differently, many startups are essentially doomed to failure at the time of the founding, and others have much better chances.
At least, that's the main thing I got from this:
http://www.paulgraham.com/die.html
If one takes serious measures to belong to that second group of startups which are not (necesarily) doomed to failure, then the really relevant question is: what is the success rate in this group? 25%? A third? A coin flip?
Of course there's also a non-trivial chance of belonging to the first group, but not acknowledging or being aware of it.
So with all of that in mind, it would be really interesting to see an update to the conclusions from http://www.paulgraham.com/notnot.html
Any data of how many founders who fail go start the second startup? I think that probably 90+% startups fail but founders failure rate is probably much lower. For me definition of founder failure would be giving up and going back to big company and not trying again.
Certainly, though they need not be exclusive endeavors. You can launch a small business with the plan of growing it slowly into a full-blown startup. So you start with the near-term goal of paying your rent and food, and a longer term goal of doing much better. (The whole idea of planning to build a $1B company makes little sense to me. Rather, first build a $100k company, then turn that into a $1M one, then $10M, etc.)
Admittedly, this sort of strategy doesn't work for all kinds of startups, in which case you might start a related small business, and use it as a base to launch startups.