Tomasz Tunguz Blog · 2014-03-03 · 4476d

Sector Competitiveness and Startup Fundraising Success: A Data Analysis

An analysis of Crunchbase data from 2004-2011 examining whether increased competition in startup sectors reduces fundraising success. The study finds that while startup formation has grown 25% annually, the correlation between number of competitors and average capital raised per company is weak (R² of -0.11), suggesting competition has minimal impact on fundraising outcomes.

3 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

Annual Startup Formation Growth Rate

25%

mean

all sectors, 12-year period

Correlation Coefficient (R²)

-0.11coefficient

average

company formation rate vs. average dollars raised per company

Variance Explained

10%

approximate

dollars raised per startup attributable to competition