Although most businesses fail in their first year, it is quite incredible just how many start-ups there are around the world doing something interesting with technology. According to Embroker:
In 2016, 69% of U.S. entrepreneurs started their business at home.
In 2018, there were 145 “active unicorns” in the U.S. collectively worth $555.9 billion.
Unicorns are trending to be even more common. The rate has increased by 353.1% from 2013 to 2018.
In 2018, male founders brought in $109.36 billion in VC, while female founders only brought in $2.86 billion in VC.
Only 2 in 5 startups are profitable, and other startups will either break even (1 in 3) or continue to lose money (1 in 3).
Founders of a previously successful business have a 30% chance of success with their next venture.
A 2018 study shows that a 60 year old is 3x as likely to build a successful startup than a 30 year old.
The highest five-year survival rate for new businesses is 51.3%.
About 90% of startups fail.
The number one reason why startups fail is due to misreading market demand — this is found in 42% of cases.
The second largest reason why startups fail (29% of cases) is due to running out of funding and personal money.
14% of startups fail due to not regarding customers’ needs.
In 2018, 82% of businesses that went under did so because of cash flow problems.
They also aggregated some interesting FinTech stats:
Worldwide, there are more than 12,000 fintech startups and 5,779 in the U.S. This makes the U.S. the most popular place for fintech startups as of August 2018.
The fintech market includes 39 venture capital backed unicorns worth a combined $147.37 billion.
There’s a whole bunch of other interesting FinTech stats listed over here on Fortunly as well:
A huge chunk of incumbent financial institutions (88%) believe that part of their business will be lost to standalone fintech companies in the next five years.
Fintech companies acquired $111.8 billion globally in investments in 2018.
Digital banking services are taking over: 46% of people exclusively use digital channels for their financial needs.
Loan origination in digital lending was $41.1 billion in 2017, a 30.1% year-on-year growth according to fintech statistics.
And, for more on this, here are some of the latest FinTech reports from the big consulting firms.
- The Pulse of FinTech report by KPMG
- Global FinTech Adoption Index by EY
- Global FinTech Report by PWC
- World FinTech Report by Cap Gemini
- FinTech by the Numbers by Deloitte
In looking this up, I also found some other interesting reports on FinTech, such as this one from Findexable who have ranked all of the cities of the world in terms of FinTech attractiveness. You may be surprised by some of the cities in the Top 10.
Or those that are the best environment for a FinTech firm.
Anyways, I’m only posting this because I liked this GIF that came my way on Facebook the other day, and it made me realise that this is probably how most FinTech, Tech and other start-ups see themselves as they embark on their journey.
Neat!
Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...
