

Does TechStars Really Have a 90% Success Rate? - paulorlando

I like TechStars, but are their published statistics accurate? Please help me figure it out.<p>I looked at stats available on: techstars.com&#x2F;companies&#x2F;stats&#x2F; and saw they have a success rate (Active + Acquired companies) of over 90%, but I only see 75%. Here&#x27;s why.<p>The first thing I did is calculate without their last 10 cohorts. The reason is these cohorts graduated less than 1 year ago and haven&#x27;t had time to succeed or fail yet. Without the last 10 cohorts (111 of their 291 startups) the success rate falls to 85% when they are removed. (Or down to 80% is you are more realistic and remove any startups younger than 2 years, but I went conservative.) I&#x27;m not changing their definition of success as being survival rate, rather than some other metric.<p>The second thing I did was look at all startups marked Active. WIthout a way to judge if they are Active other than what I see online, as a proxy I looked at whether they had posted to a blog, Twitter, or Facebook anytime in the last year. In some cases there was news of them going into the deadpool or a domain for sale, but for the most part they look like Zombies, not officially dead.<p>It&#x27;s not a perfect way to judge so please let me know if any of these startups that look inactive are really alive:
J-Squared Media, Application Experts, UsingMiles, HaveMyShift, InvitedHome, ScriptPad, Marginize (the team formed a different company but I&#x27;m counting this one as failed), Highlighter, RewardsForce, Wantworthy, Creative Brain Studios, Strohl Medical Technologies, Veri, CloudSnap, Emergent One, Rewind Me, ReplySend, RollSale.<p>To measure accelerator programs against this 90% standard, I&#x27;d want it to be accurate. Again, I like TechStars and I&#x27;m posting this to learn. If we measure all accelerators the same way, I&#x27;m sure a lot of obscure programs have high success rates as well.<p>Thanks.
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argonaut
> they have a success rate (Active + Acquired companies) of over 90%

Firstly, nowhere on that page does TechStars claim a 90% success rate. The
interpretation of Active + Acquired = Success, is actually wrong.

It is actually trivially easy for a startup that, for all intents and
purposes, is dead, to keep limping along for years, or to otherwise maintain a
skeleton presence.

You could consider using the acquisition % as a metric for success, but even
acquisition/exit % is not a good metric for success because the best companies
go years and years before IPO/exit (see: YC's biggest winners like Dropbox and
Airbnb, which have not exited yet but are widely considered mega-unicorn
successes), and because acquihires are actually failures, just dressed up as
soft exits.

The closest metrics to success _for measuring an accelerator 's performance_
that I can think of are % of graduate companies that raise money, average seed
valuation of companies after graduation, and/or average valuation of graduate
companies in the entire portfolio.

Even those metrics are flawed.

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paulorlando
Agreed that Active does not equal succeeded, I was just seeing that in the
list, there are companies that have already failed/closed without being listed
and should not be counted at all.

While the success = 90% rate isn't on that page, they've said it in
presentations and it has certainly been reported / misreported in the press.

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paulorlando
Revising the above since I was told that Highlighter and UsingMiles were
acquired and that App-X is alive and InvitedHome changed its name to Invited.
The success rate is now at 77%.

