January 18, 2017
As Mattermark has found, the top three accelerators in the startup business — Y Combinator, Techstars, and 500 Startups — have been responsible for about ten percent of all series A deals in the U.S. for a couple years straight.
The real news here? Most people in the tech world thought that number would be higher.
Here's what Mattermark had to say in a recent blog post:
“According to Mattermark data, the prevalence of graduates from these programs raising Series A rounds was near all-time highs in 2016, with 9.3 percent of Series A deals. 2015 marked the high point, with the trio of accelerators contributing 10.1 percent of all Series A deals. […] The upward trend for these three programs contributes to the overall upswing of Series A round activity, which has more than doubled over the past 10 years.”
The Series B, meanwhile, remains the easiest round to land: Series B dollars are up 207 percent since Q3 2015, though VC investment continues to constrict slightly overall.
Interestingly, Mattermark includes a Twitter poll in which 60 percent of the 514 respondents said that they expected the three accelerators to be responsible for more than the roughly 10 percent of Series A rounds that they landed in 2016. It looks like the majority of tech insiders who voted expect to see a wider divide among successful accelerators and lesser known ones.
This response aligns with certain popular beliefs in the tech community. Consider the 80/20 rule, also known at the Pareto principle, which states that around 80 percent of one's benefits often come from 20 percent of one's causes. Or, even better, take a look at income inequality in the U.S., which is far worse than the average person assumes it is: The top one percent in the U.S. average earnings of $1.3 million a year, over three times as much as they pulled in during the 1980s, while the bottom 50 percent average $16,000, a number that's stayed the same for three decades.
While the top three startup accelerators should definitely be congratulated for their significant chunk of Series A successes, the numbers might just as easily be a vote of confidence in all the other accelerators out there. After all, that remaining 90 percent needs to come from somewhere.
Did you like this article?
Get more delivered to your inbox just like it!
Sorry about that. Try these articles instead!