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Are Top US Startups Really Startups? (om.co)
Veteran technology reporter and columnist Om Malik writes: Pitchbook, a data research company has come up with a list of top 14 most valuable startups in the United States. There are no real surprises -- they are all ranked by valuation and they all are valued at north of $4 billion. They are all household names -- barring Outcome Health and Samumed. And they have been around forever. They have thousands of employees and many have billions in revenue. What they are not is liquid on public markets. They have not IPO'd. In a different Silicon Valley, they will all be public companies and they won't be deemed startups. Revenue, growth, relative size, market share -- pick a metric (except for lack of profits in many cases) and you know they aren't really startups. So can we stop calling them startups -- and instead maybe call them VC-backed private companies -- otherwise the label startup loses its meaning.
Transfer money from bored billionaires to new millionaires.
The product is making the billionaire feel less guilty or get more publicity.
I am not sure what the official definition is, but I would say a company is a startup until its business model is fully validated. As soon as they have hit scale, and are growing without half of their budget going into marketing, then they are just a company. Not being profitable isn't much of a problem if the primary reason they aren't profitable is because of increased investing in their product (aka Amazon).
Also, I find it hard to call any company which has went through a large IPO a startup. Sounds a lot like a standard company at that point to me.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
My 15 year old "startup" isn't publicly traded and definitely doesn't make a profit.
Offers above $4 Billion please
In the meantime I'm going to go hire some unpaid interns, you know, because startup.
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There are many large private companies that could in no way be considered start-ups.
Is Mars (the candy people) considered a start-up? Bechtel? LEGO?
PitchBook doesn't seem to state their criteria for a "startup" (and I looked), but it seems whatever measure they use is off.
In order for a company to be deemed a startup they should 1.) Be employed solely by the developers contributing to the startup and any free outside help they are able to recruit. 2.) Be based out of a garage or home dwelling. 3.) Be self funded, no third party funding (Venture Capital) and not generate more in revenue than their overhead. Majority of the unicorn startup boards are a joke. When you have in excess of a billion dollars in funding you are not a startup.
Public companies are the bane of society. They create inflation and devalue the humans working for them. No companies should be public, or rather not have a valuation that exceeds the assets and 2 previous years of profits. As it stands now, high frequency trading and other type of speculants can increase the valuation of the company for no good reason whatsoever. Private companies are much less of an assholes to deal with as well.
... any VC backed company that has not yet achieved a positive ROI.
File under 'M' for 'Manic ranting'
Pitchbook, a data research company has come up with a list of top 14 most valuable startups in the United States[om.co].
Here is a link to the actual list by Pitchbook, rather than linking to the reporter's own article on the subject. msmash, it would probably be good to update the summary to use that url for the first link, since that's where people will expect it to go.
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Can impart wisdom and truth
Call proc signature()
There's no legal requirements associated to the label - it's just a marketing gimmick. Maybe it's true to the connotation, maybe it isn't. As soon as it stops suiting their needs, they'll change it.
In debates about Christianity, there are two groups: those looking for answers, and those looking to just ask questions.
I don't think that means what you think it does.
None of those are companies I've ever heard of. So maybe they're well known in certain, small circles but I wouldn't call them "household" names. Or brands. Or whatever they're doing since it seems their products are nothing more than sinkholes for good cash following bad.
We'll all stop calling them startups, whats next on the to-do list...ah yes, world peace.
"pick a metric (except for lack of profits in many cases) and you know they aren't really startups. "
The metric I would pick is "recently started." Because that's the definition of startup.
The start up dates in the list range from 2002 (SpaceX) to 2012 (Lyft). So they range from 5 to 15 years old.
15 years might be pushing it, but all but 3 of the companies on the list were started less than 10 years ago, so by my count yes, they'd be called startups
Much like "small business". Seriously, look at specific companies named when talking about "small businesses". More often than not, they're not small -- they're just not megacorps.
The T. Eaton Company Limited was founded in 1869, became Canada's dominate retailer in the early 20th century, but has its IPO in 1998 as it was declining into bankruptcy.
You are what you call yourself. That makes me a Martian.
I have to agree that while these companies may have at one point began as a start-up, however certainly a line is crossed at some point where they can no longer be called start-ups.
The multi-million dollar start-up I was most recently involved with by the way 'started up' with a few million bucks, and something like 10 founders, 1 CEO, 1 CTO, and 1 developer.
In the first years I would say yes we were a start-up, however a few years into it when there are 100 people taking up most of an office, another 50 remote, and you're on a HR and payroll and benefits system no different than if you worked at Target... I'd have to say then that this company is no longer a start-up, but instead a rapidly growing business.
I work for a company that is making a ton of money and serving a lot of customers and has been around for years, but it still considers itself a startup. I wondered about this.
The CFO explained it in an internal meeting: his definition is that a startup is a company that is still focused on growth above all else. And it's true, the company I work for is plowing a lot of revenue into expansion opportunities, going for growth rather than profits.
When a company has a stable position in its market and starts focusing on making lots of money and/or paying out good dividends on its stock, at that point it is definitely no longer a startup.
I don't know how universal this definition of "startup" is but it makes sense to me, and it nicely handles some of the corner cases discussed in the previous threads here today.
lf(1): it's like ls(1) but sorts filenames by extension, tersely
1. Fedgov prints a bunch of free money out of thin air, calling it "Quantitative Easing"
2. Fedgov gives that free money to their friends / "campaign contributors" in the big banks
2. The big banks bid up every asset they can find, but still have piles and piles of free money sitting around.
3. Big banks can't figure or anything else to do with all that free public money - so they start giving a bunch of it to the bankers' inbred, half-wit cousins who run VC firms in Palo Alto
4. The VCs discover they've been given more money than they can possibly waste on hookers & blow. So they hire a few of their butt-buddies from the Stanford dorms to found some "startups".
5. The butt-buddies look at what other loss-making companies are doing, then do the same thing only with an even stupider company name.
6. No business acumen, nor any actual talent, are required to get a leadership role at a startup. You just have to be from the "right schools". Consequently the startups have no business model and not much ability to execute. But hey - at least this time they didn't pay "outrageous" salaries to a bunch of filthy working class nerds!
6. The startups make a handsome loss, undercut and bankrupt a few legitimate businesses, and keep on getting bigger and bigger valuations each time they return to the VC teat to suck more free public money.
7. Somewhere way up the food chain, someone in DC or New Jack City gets a little nervous about propping up so many worthless loss-making "startup" companies.
8. The steady stream of free public money starts to dry up
9. The Crash!
10. Somewhere in Palo Alto, a Stanford boy can no longer afford his Personal Ass Sanitation Assistant, and is forced to resume wiping his own butt.
because I can't say I have used or worked with any of the companies on that list.