We asked 700+ founders to answer one of the most frequently asked questions we receive: are we in a bubble? Last year 73% said we were. While this year the majority still say yes, it’s closer to a coin flip (57%), down 22% from 2015.
Though the majority of founders say we’re in a bubble, 9 out of 10 founders believe that it’s a good time to be starting a company. All aboard!
The unbridled optimism that drives founders is alive and well in tech: 18% of leaders say they’re certain they’ll build a billion dollar company. But that’s not to say there aren’t bumps along the way. The same percentage of leaders (18%) also report having executed a layoff in the last year.
In 2015, just one in three founders expected the IPO market to improve. This year, the IPO window has opened more; that number has inched higher to 43%. Founders are far more bullish about acquisitions, with 72% predicting increased M&A activity in the year to come.
We asked founders to write in the name of the one company they'd want to acquire their startup. Out of 150 companies named, Alphabet rose to the top as the most sought-after acquirer.
We asked founders who’d have the advantage when negotiating deals over the next few years: entrepreneurs or investors? For the second year running, founders point to investors as having negotiating power, and their conviction has strengthened: two-thirds of all founders believe investors will hold more sway. Last year, just over half (54%) of respondents felt similarly.
We asked founders to pinpoint the main driver behind women and ethnic minorities being underrepresented in tech. While men and women agreed on some factors, they diverged on others. Men are more likely to blame the pipeline into tech; women place greater emphasis on unconscious bias and lack of role models.
And it only gets less balanced with time. Among respondents' companies, the boards of later-stage startups are almost three times less likely to have a woman on their board.
On average, respondents believe tech is 14 years away from mirroring the gender and ethnic makeup of the United States. Over one quarter of founders believe parity is more than two decades away.
For the second year in a row, founders were most worried about finding and hiring the best people. Last year, founders’ second greatest concern was revenue growth, but in 2016, they worried more about acquiring customers. When it comes to diversity and work/life balance, approximately 1 in 4 founders say they aren’t concerned at all.
Seven out of 10 founders say that bitcoin is overhyped — the second straight year that founders believed the technology has received undue buzz. However, over half of all respondents say that agtech (54%) and life science (52%) aren't getting the spotlight they deserve.
Once again, we asked founders to write in which current tech leader they admire the most and we tallied 125 names. The Tesla and SpaceX leader held firm at the top spot (23%), followed by Jeff Bezos (10%), Mark Zuckerberg (6%) and Steve Jobs (5%). The most cited female leader is Sheryl Sandberg, who clocked in at 1% overall, and 5% for female respondents.
While we highlighted a dozen findings, the survey actually yielded many interesting, surprising, non-obvious results. See below for everything from how often companies rely on bridge loans to how many founders believe they’ll be CEO in a decade. We've also broken out the demographics and attributes of the 700+ founders who responded.
We had some incredible help making this project possible. Many thanks to Pablo Robles for designing and creating all the newsroom graphics, and to Jonathan Moreira for his design work early on. And to Mike Goodwin, our intrepid data scientist, who made sure we did everything right (including our math). We’re also much obliged to our web design firm July Camp. Last but not least, we are grateful to the hundreds of founders who took time to share their profiles and perspectives so that we could reflect back the state of startups in 2016.
