The eternal optimism of being a tech founder

First Round capital surveyed 869 founders for their annual “State of Startups” report. Chief takeaway? Most entrepreneurs wear rose-colored glasses.


December 7, 2017

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.

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