> Examples: Publicly traded companies Uber and Lyft.
> Sorry, they're not startups.
As an aside, I don't like how the tech industry/news sites call any non-behemoth tech company a "startup".
For example, these companies are not startups; they are large (and in some cases, deeply unprofitable) enterprises: SpaceX, Stripe, Airbnb, JUUL, Palantir, Epic Games, Wish, Coinbase, Robinhood, Instacart, DoorDash, WeWork, etc. [0]
Furthermore, 89% of American businesses have fewer than 20 employees [1].
[0]: These are the largest US-based "unicorn startups" per Wikipedia: https://en.wikipedia.org/wiki/List_of_unicorn_startup_compan...
[1]: https://www2.census.gov/programs-surveys/susb/tables/2016/us...
I suspect most air conditioning contractors and electricians would be called 'startups' if they worked in software.
Criteria like “founded in the last Y years”, “has fewer than N employees”, “has market cap under $X”, “is in a fresh/hot industry” alone or in combination end up including dramatically different sets of companies.
You can be a 0-day 1-person company but if you have a business model and an operating structure, you're not a startup. Most companies are started on a specific business idea and planned to run for long term on that idea. Those are not startups.
Uber was founded 11 years ago. How long do you need to validate the business model of a taxi app?
AirBNB was founded nearly 12 years ago. How long until they're done validating the business model of letting people rent apartments over a website?
How about a meal kit company?
Words mean what people who use them intend them to mean, so we end up with things like this:
noun
a new business venture, or a new commercial or industrial project.
adjective
of or relating to the beginning of such a venture or project, especially to an investment made to initiate it
https://www.dictionary.com/browse/startup
NB: dictionaries are not authoritative sources for living languages, rather they can only be historical records. Thus, words mean what people who use them intend them to mean.
Meal kits are not that revolutionary. Frozen meals have existed for decades, adding some different ingredients and shipping isn't a big innovation on it's own and is more of a standard evolution of food retail.
In my book, a VC money is not a prerequisite for being a startup (although that tends to be how things go these days)
Most air conditioning contractors and electricians are in a different category. Unless they set their tariffs wrong by an enormous amount, they are profitable almost (they may have to invest in tooling and transport) from day one.
But do they provide innovative solutions and aim for growth?
And I don't like how they call these companies "tech" companies.
Yes, they use computers, but mostly in ways that we have been doing for decades. By that standard, every company is a tech company including farmers and banks.
If they must call them "tech", then call them "low-tech" unless they regularly and substantially publish in scientific journals.
And no, having a pet tech project like self-driving cars does not make you a tech company until it's getting close to your main source of profit.
These hyper-growth companies are showing their weakness. They only work during hyper economic growth. The fact that Uber and Lyft don't have like 2 years of runway in the bank is a strong indication of exactly how much these companies are gambling like drunken sailors.
This is exactly why we must bail out the people and let the companies that did not heed the warnings die out. Ideally with the owners losing all those mega billions they managed to grab.
I'm talking about the average Silicon Valley VC firm.
This plea for halp is left as an exercise to the reader.
[0] https://techcrunch.com/2020/04/08/deliveroo-graphcore-and-ot...
Examples: Publicly traded companies Uber and Lyft.
Sorry, they're not startups.
And yes, most will have less than 6 months in the bank. Most rounds of funding are planned to last 18-24 months. If they raised at the tail end of 2019, they're already 4+ months into that.
More likely, the bulk of the 65% are companies who raised late 2018 through mid 2019. They're in the middle of figuring out their new round and who will/won't be involved. The good news is that the VC funds have to put their money somewhere so investment can't stop. LPs don't invest for good luck. The bad news is that VCs are likely going to slow down for a quarter or two and valuations will grow more slowly than before.
Companies that have good metrics may be in good shape as VCs become more available and their pipeline dries up. Companies with mediocre to bad metrics may be gone by the end of the year.