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Comment by sharkmerry | Hacker News Reader

whats the rate of failing for startups with >$50m valuation? Is there a tracker for that as well?

Yes. About 75% of venture-backed companies fail to return cash to investors.[1] Many of those failures are zombies - the company continues to operate, can cover its running expenses, but can't pay back its startup costs. In the ICO world, that would be considered a success.

[1] https://www.fastcompany.com/3003827/why-most-venture-backed-...

So many of them are paying people living wages, or at least had been during their lifetime. Compare that to failed or scam ICOs, which do literally 0 people any good except maybe the "founder."

Well let's not forget about all the productive hosting business this is drumming up, some poor megacorporation is barely holding on by offering their cloud hosting services to all these ICOs.

(there isn't a window fallacy we can't broken here :D)

Valuation is different than market cap.

As stated in another comment, a coin only needs to sell one unit, and because of the supply; they have a large market cap.

That's exactly what valuation is.

Ask the opposite question- rate of success for startups with >$50m valuation

IMHO, it's certainly below 3.8%

You are so wrong that I audibly laughed, even though I’m in this room by myself.

Are you saying that, if you take 100 random startups and look say 5 years later at how many survived AND are valued over 50 millions, you have more than 3?

I would like to know which distribution you sample from :-)

That’s not what your comment says. It says that the rate of success of startups which already have $50m valuations is less than 3.8%.

Then I apologies for not being clear.

What I meant to say, is that if we look at the coin graveyard, we are including 100% of the failed coins -- because ICO were heavily publicized.

If we look at the startup survival rate, we are not including 100% of the attempt. Some will consume money, but never even make a blip on the radar.

If you consider the failure rate of startups vs the failure rate of ICOs, I think ICOs show a higher success rate - and even more when you raise valuation.

Here is a more extreme example: A startup valued over 1 billion is a unicorn. An ICO valued over 1 billion is at the moment (with rock bottom prices) anything above the top 18

We can disagree on the valuation formula (fair critic), but even with that a 4% success rate >50M is nothing to sneer at.

It's possible to see failed startup if we use figures from an accelator, like say YC.

From https://blog.ycombinator.com/yc-portfolio-stats/ :

Number of YC companies worth more than $100 million: >20

Number of companies funded by YC so far: 716

Let's say 20, and use the $100 million instead of the $50M as I can't quickly find YC numbers for $50 million.

Still, 20/716 is about 2.8%

So I repeat my words: a success rate of 3.8% is wonderful.

Reply on news.ycombinator.com