10 Charts That Explain the World According to Founders

What do founders really think?

First Round conducted its second annual survey and got feedback from 700 founders.

We usually look at startups from an investor’s perspective.

But we thought we’d wrap up 2016 by viewing the startup community from a founder’s point of view.

First Round published 52 answers from respondents. Below you’ll find the 10 I found the most surprising and why, starting with a focus on growth.

1. If you’re not successful, why do you think that will be?

All fairly obvious answers until you hit burn rate. It was among the hottest and most oft-repeated topics of 2016. Startups must ratchet down burn rate in a tighter capital-raising environment. Believe me, founders got the memo. So why aren’t more of them concerned about burn rate?

Three possibilities.

  1. They need the latté and keg bar to attract top talent.
  2. They already have cut back on their burn rate. Or, more likely…
  3. High burn rates and rapid growth often go together. And it’s high growth that attracts VC money. That’s why growth stagnation is among the top things founders fear the most.

2. Are you optimizing for growth or profitability?

Instead of growth at what cost, this question addresses the issue of growth from another angle. Actually, I’m surprised at the high percentage aiming for profitability. Hasn’t Uber and its $68 billion valuation proven the case that growth is king? Despite a lot of talk from the VC community that startups should think more in terms of profit and loss, growth – especially exponential growth – is the narcotic that VCs crave the most.

3. How many years until you think you’ll be profitable?

A full 48% of founders say profit is one to three years away. Ha! They can say it. They can even believe it. But that doesn’t mean you have to. I get these overly optimistic answers all the time about future profitability. Not sure why I ask anymore. (70% of startups surveyed here were early-stage companies up to Series A.)

4. Which platform are you most focused on?

Web crushes mobile. That shocked me until I realized that 38% of those surveyed belong to enterprise startups and only 23% head consumer internet companies.

5. How long was your entire fundraising process for your most recent round?

Four months or less for 75% of startups. The process is intense and grueling and takes founders away from the business of growing their companies. I’m sure they think three or four months is a couple months too long. The crowdfunding process tends to be longer but less intense. I’d be interested to learn which road founders prefer (all other things being equal).

6. In your last round, did you raise more or less than you targeted?

A full 76% of respondents are satisfied with the amount they were able to raise. And 24% aren’t. I’m pretty sure that a much higher percentage of those who crowdfunded wish they could raise more. Part of the growing pains of a very new investing sector. It will improve.

7. How old are you?

More than half are 36 and older. I wouldn’t have guessed that. It seems that I’m always talking to the 26- to 35-year-old founders. They make up 43% of the respondents. I would love to see more data correlating these age groups to successful exits.

8. Which industries are overhyped/underhyped?

Couldn’t agree more as far as agriculture tech (54% of respondents) and life sciences (52%) being underhyped. But security? Not if that refers to cybersecurity. It gets a lot of play in the blogs and press.

But it’s the overhyped category that has more surprises. Drones, autonomous vehicles and the Internet of Things are all huge opportunities and attract a lot of attention. But the biggest opportunity of them all could very well be bitcoin (and the “blockchain” technology behind it). And there’s a dearth of excitement about bitcoin these days. Yet seven out of 10 founders say it’s overhyped.

9. How confident are you that you’re building a billion dollar company?

A 60/40 split on those who think they can reach Unicorn status and those who don’t. Somebody should inform the 40% who don’t that their shot at VC money shrinks considerably once they’ve admitted this.

10. What do you consider to be the primary driver of your company’s culture?

What? Product only 4%? Customer a pathetic 2%? Leadership – the guys with the vision and charisma – just 1%? How can this be? As a rule, I haven’t asked this question of founders. That changes right now.


I found this survey fascinating. The more you know about how founders think, the better.

After all, when you fund startups, you’re demonstrating your belief that the founders will do what they say they’ll do.

How they’ve reached such conclusions and how they intend to fulfill their promises to financial backers is more than a passing interest to investors.

As you can see from the last question listed, this survey has already changed some of my behavior as an investor. Perhaps it will change yours as well.

Invest early and well,

Andy Gordon
Founder, Early Investing

Editor’s note: All charts in this article are courtesy of First Round.