Startup Success - Analysis of Unicorn Startup Founders

By Patrick on 8/11/2024

Here is an analysis of what makes founders successful from the following sources:

• (1) Defiance Capital “The Unicorn Founder DNA Report” (Sample size: 972 unicorns and 2467 founders) Techcrunch posted about it

• (2) Endeavor Endeavor Report (200 unicorn founders)

• (3) McKinsey McKinsey Report (analyzed 100 unicorns)

If multiple sources stated the same stat, I often favored the stats with the largest sample size. I did sometimes highlight the other ones.

Founder Age

1. Average Age When Founding

   • US: 33-34 years old [1]

   • Europe: 29-31 years old [1]

   • Study conducted by researchers from MIT, Northwestern, Wharton, and the U.S. Census Bureau found that the mean age of startup founders across the U.S. was 42 years (Not siloed to unicorns)

2. Age Variations

   • Teams with female founders tended to be younger [1]

   • Solo founders tended to be older [1]

   • CEOs with STEM degrees started companies later [1]

Founder Background

1. Top Universities [1]

   • US: Stanford, MIT, and Harvard dominated

   • Europe: Founders tend to study at top universities in their home countries

2. STEM Degrees

   • US: 49% of unicorn CEOs had STEM degrees [1] (Endeavor found this to be 61%)

   • Europe: 30% of unicorn CEOs had STEM degrees [1]

3. 20% worked for an “elite” employer [2]

4. 50% previously worked at a startup [2]

5. Average of 10 years of working experience [2]

6. 50% of unicorns had at least one serial founder in both the US and Europe [1]. Endeavor also reported 49% for this. And McKinsey - more than 50% had founded start-ups before [3]

Founding Team Characteristics

1. Team size: solo founders were rare, especially among immigrant founders [1]

2. Founders have different skills than their counterparts [2]

3. Had at least one white founder (82% US, 91% Europe) and had at least one immigrant founder (62% US, 41% Europe). [1]

Founder Heritage

1. Immigration Status [1]

   • In the US, Split nearly evenly between 1st and 2nd generation immigrants
   • However, in the EU with 1st gen immigrants built almost twice as many unicorns as 2nd gen
   • Europe: 40% of unicorns had immigrant founders
   • 62% of US unicorns had immigrant founder

2. Ethnicity [1]

   • US: 38% of unicorns had at least one non-white founder

   • Europe: Only 14% of unicorns had at least one non-white founder

Founder Gender

1. Female Representation [1]

   • US: Increasing trend, reaching 17% of new unicorns with female founders in 2023

   • Europe: Lagging, only 5% of new unicorns had female founders in 2023

2. Gender and Other Factors [1]

   • US: Women slightly more likely to be serial founders and elite university graduates

   • Europe: No female solo founders, female CEOs half as likely to have STEM degrees

Seed Funding Landscape

1. Top Seed Funds

   • US: Y Combinator (10% market share), SV Angel (6.4%) [1]

   • Europe: Seedcamp (5% market share) [1]

2. Impact of Top VC Funding

   • 28% of US unicorns raised from a top 10 VC seed fund [1]

   • 24% of European unicorns raised from a top 10 VC seed fund [1]

3. VCs look for start-ups that can show significant progress within 2-3 years [3]

Psychological Factors

(as interpreted by Defiance Capital)

1. No plan B

2. Unlimited self-belief

3. History of feeling like an imposter (phew…)

If you’re interested in founding a SaaS company slimsaas.com.