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Bill Gross CEO of Idealab


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What makes a Startup Successful?

Published in: Internet
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Bill Gross CEO of Idealab

  1. 1. There has never been a better time in history to start a company * * What makes a Startup Successful? Bill Gross Founder & CEO, Idealab
  2. 2. I’ve been starting companies since I was 12 years old…
  3. 3. Started my 2nd business when I was in High School
  4. 4. Started my 3rd business when I was in College
  5. 5. I graduated from Caltech the month IBM released the PC
  6. 6. Began writing PC software, Tools for Lotus 1-2-3 Lotus Development acquired in 1985 for $10 Million
  7. 7. After seeing first Multi-Media PC, started Knowledge Adventure when my son started Kindergarten in 1991
  8. 8. Grew Knowledge Adventure to #3 Educational Software Company
  9. 9. Netscape Browser and IPO in 1995, 30M Global Users
  10. 10. Started Idealab as a technology incubator in 1996 Idealab is a “business” designed to create businesses
  11. 11. First 12 Ideas in 1996
  12. 12. More than 100 companies founded in our 1st 18 years
  13. 13. Of those 100 Companies, Idealab has: • Helped the companies raise more than $3.5B • Completed 45 successful IPO’s and acquisitions • 30 current operating companies • Experienced 50 failures • Created more than 10,000 jobs
  14. 14. What Matters Most To Make A Startup Successful? • Everyone is looking for a simple formula (I’m sorry) — As Peter Thiel says in his book:  The next Bill Gates will not build an operating system  The next Larry Page won’t make a search engine  The next Mark Zuckerberg won’t create a social network • Every bold new company is new and unique, no one can prescribe HOW to be innovative • Successful people find value in unexpected places • So if I can’t give you a formula, what can I give you?
  15. 15. 5 Essential Elements that Lead to Success Ideas Team Business Model Funding Timing
  16. 16. Looked at factors of success / failure in 130 companies Idea Team / Execution Business Model Funding Timing  Novelty/Differentiation  “Truth” that no one else sees  Competitive Moats  Efficiency/Effectiveness  Adaptability  Clear Path to Generating Customer Revenues  Raising Money for Initial Funding, Follow-on & Growth  Way Too Early  Early  Late
  17. 17. Unicorn Successes and Failures
  18. 18. Unicorn Successes and Failures
  19. 19. Looked at factors of success / failure in 130 companies Timing Team / Execution Idea “Truth” Outlier Business Model Funding 42% 32% 28% 24% 14%
  20. 20. Top 5 Factors Leading to Failure No Market Need Ran Out of Money Not the Right Team Got Out-Competed Pricing Cost Issues 42% 29% 23% 19% 18%
  21. 21. Execution Matters a LOT, but Timing Really Matters Maybe even more than the idea itself! * * • Apple’s Newton • YouTube • Facebook • Instagram 1
  22. 22. 2 Recognize your Strengths and Build a Complementary Team • Design a structure around strengths, and balance your weaknesses by hiring complementary skills • You need multiple viewpoints to interpret your learnings wisely
  23. 23. You may be ridiculed for having a great idea ahead of its time All truth passes through 3 stages. • First, it is ridiculed. • Second, it is violently opposed. • Third, it is accepted as being self-evident. 3 Arthur Schopenhauer 19th century German philosopher
  24. 24. Summary • Startups can change the world. • I have started companies in good times and in bad • Now is definitely the best time ever to start a company  Startups are understood  Attracting talent has never been better  Attracting capital has never been better  Reaching a global market has never been easier • It’s easier than ever to START a company, but just as hard as ever to BUILD a great company • I believe if you focus on the 5 factors to make your company strong, and avoid the 5 factors that make most companies fail, you can improve your odds of success
  25. 25. To contact me: To follow me: @Bill_Gross