This year, VC fund, First Round capital surveyed 869 founders for their annual “State of Startups” report.
One of the chief takeaways? Most entrepreneurs seem to wear rose-colored glasses when it comes to thinking about the well-being of their companies — but reality doesn’t always match perception.
Perception: 50% of founders think they’ll be profitable in 1-2 years
Reality: ⅔ are optimizing for growth, not profitability
25% of founders admit they’ve made the mistake of letting their burn rate get “too high” while growing their business. Yet, “curbing burn rate” is only a moderate priority for 55% of respondents.
Perception: Sensitivity training and more women VCs will solve workplace harassment
Reality: Only 17% currently have formal plans in place to promote diversity and inclusion
And, nearly 60% said their board was all male. That said, admitting there’s a problem is the first step. We’ll see if next year’s stats look any different…
Perception: 41.8% of respondents are confident they have a “decent shot” of becoming a billion dollar company
Reality: There is a “0.00006% chance” of this actually happening
Guess they never read this damning First Round article or CBInsights’ slightly more favorable ballpark of about 1%.
We don’t mean to dump on the founder mentality
Starting a company isn’t for the faint of heart, and it takes a certain level of “blind ambition” to weather the storm of startup life.
Instead, consider this more of a PSA not to let indomitable optimism keep you from course-correcting when you see an iceberg.