Video summary of the article:
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The approach:
According to Ali, he spent over 4 years, collecting over 30,000 data points
from over 200 startups that had reached a unicorn status i.e billion-dollar
valuations. Ali in a recent Inc, article wrote that:
I analyzed more than 65 factors per company: everything from a company's early competitors to the timing of its fundraising rounds to its founder's age and university ranking. No study is meaningful without a control group, so I also collected the same data on a similar-size group of randomly selected startups founded in the same time period (between 2005 and 2018) that didn't go on to billion-dollar valuations.
What is key Super Power of Super Founders?
Based on the data collected, Ali concluded that, the key trait or super
power of billion-dollar startups founder is....
History of entrepreneurship, whether that's building a company, a side hustle, or a smaller project. Those who had created something that generated value--even on a small scale that would be considered a failure in the venture capital world--were more likely to go on to found billion-dollar companies than those with shiny resumes filled with brand-name employers and universities.
The myths debunked:
Through his research, Ali also debunked a few myths, associated with
founders.
1) Most founders of unicorns did not have experience in the same
industry
- Only 30% of tech startup and 40% of Enterprise/SaaS space had previously
worked in industry.
2) The vast majority of successful companies faced robust competition
- 85% of startups had pre-existing competition and 50% were competing
against incumbents. Companies with big competitors were more likely to
become unicorns.
3) Solo founders were not less likely to build billion-dollar startups
- Ali found that the number of founders had no correlation to
success.
Takeaways:
Founders should focus on creating and capturing value. Start with the
fundamentals of identifying a need (or a problem), run quick experiments to
validate the idea, create Minimum viable products and then focus on
scale.
