I have total respect for TechStars and what I know about it tells me it’s a great program.
So when I recently saw TechStars’ results page with a 80% success rate I had to learn more. I’m always very interested in “success/failure” at startups so I looked through their list of previous classes, going back to when they started in 2007. First thing I noticed was that the list might be out of date (ToVieFor from the most recent class is still shown as active).
First a word on how I gathered the data.
TechStars lists company status as either Active, Failed, or Acquired. But after I started to look, I saw a lot of companies that were listed as Active, but didn’t seem to be so. So I started a 4th category called “Inactive” and began to look at the list.
Since I didn’t have any inside info and company founders don’t take kindly to strangers emailing and asking “hey, you still doing this startup or what?” I used publicly available information. I marked a company as inactive if they shared a couple of these traits: blog hasn’t been updated for over 1 year (many were more than 2 years old), has a Twitter account but no activity, has a Facebook account but no activity, the site doesn’t exist anymore (that was the easy one), the site is still a landing page just collecting emails even after more than a year.
I also only looked at the first five TechStars classes, since any newer company hasn’t had a real opportunity to succeed or fail yet.
I’m probably not totally accurate in the list, so take it as a list of who “appears” to be Inactive based on information online.
This is TechStars data for the first five classes.
And when I add the 9 companies (listed at bottom) that appear to not be Active, I get the results below.
This takes the TechStars from an Active + Acquired average of 84% for those classes down to 66%. If you look only at Active companies, then it goes from 67% down to 49%.
If anyone has better data, contact me and I’ll be happy to update this. To make it easier for you to make corrections, these are the 9 extra companies that seemed to be inactive: J Squared Media, BuyPlayWin, Peoples Software Company, LangoLab, TempMine, Mailana, Rezora, Monkey Analytics, TutorialTab, Sparkcloud. (Sorry for any mistakes.)
I wrote this to learn about startup longevity rates, not to upset anyone. And I know that sometimes startups look inactive but there are other things going on.