When people find out I work closely with startups, I often get asked, “So, is it really the way it looks on Silicon Valley?” The answer I give is similar to what I say when people find out I live in Portland and ask how true to life is Portlandia? It’s satire that has some of its roots planted in reality. Okay, Portlandia is pretty much spot on, but that’s a whole other post.
But what about startups? Is it a world of overnight millionaires, lavish parties thrown by people who would rather be back at home writing code, and a foosball table in every break room? Well no, it’s not. Not even close. Except for the foosball. So much damn foosball…. Would it kill someone to get an air hockey table every once in a while? But I digress…
According to Forbes, 90% of all startups fail, many before they even launch a viable product. So why should we pay attention to startups then? Why would StackPath create Propel, our program dedicated to helping startups grow and succeed? Well, besides being a purely altruistic venture and the right thing to do, it’s good business.
In the 1950s, the average lifespan of a S&P 500 company was more than 60 years. By the 1990s, it was 20 years. In the next 8 years, it is projected to shrink to 14 years, and roughly 50% of the S&P 500 will be replaced. Companies that choose to not focus on innovation and new internet-centric businesses are not only missing out on a huge opportunity, they are guaranteeing their eventual demise.
DATA: INNOSIGHT | Richard N. Foster | Standard & Poor's
A colleague of mine, who had always worked at early stage companies, did a two-year stint at a large corporation. One day during a board meeting he asked, already knowing the answer, “How many of our top 1000 customers were founded after the year 2000?” The answer: zero. An entire generation of tech companies was missed. Facebook, Google, Amazon… the list goes on and on. And to make matters worse, those tech companies now view the old-school company as irrelevant and there is virtually no way they would ever become customers. Not surprisingly, this corporation's revenues, quarter after quarter, year after year, continue to decline. They had become dependent on their legacy customers, and as those firms failed to innovate and got left behind, they left a big, glaring hole. To use a sports analogy, they have no bench, no farm league, and no future draft picks.
That’s Propel. We find the next big things, the up-and-coming stars, and the future Hall of Famers. Who knows? Maybe even the next great company to become a part of StackPath. And even if these startups don’t pan out and never become paying customers, that’s totally fine. We’re here to help and increase their odds of success.
So save StackPath a spot at the foosball table, we got next.