Why you should ignore startup failure stats
Article by Eran Laniado from VentureBeat.com
Thousands of entrepreneurs worldwide share the dream of founding a startup. However, some publications “pour cold water” on the ambitions of future founders.
For example, a recent article publicized the low success rates of startups participating in the excellent Y Combinator program. Aspiring startup founders may be intimidated by such publications and forgo their dreams.
In some cases, that would be a real shame.
Surely, many college grads have excellent reasons to seek careers at Apple or Amazon instead of establishing their own ventures; similarly, many business school graduates are incentivized to join top consulting firms. However, the chances of getting admitted are low: in 2011, only 0.35% of Google applicants were hired.
Here are five reasons that, for some people, giving up on the dream of entrepreneurship too soon may be a mistake. The alternatives to startups may be pretty risky, too, but many people are not aware of that; furthermore, real startup risks could be much lower than the common perception.
1. Risks associated with large corporations
The high risk of startup failure may imply that it is better to start a career with a large, established organization. But is it?
Recently, the corporate world has changed significantly. It now presents previously unknown risks. Various industries (e.g. newspapers) are in severe crisis. The investment banking industry, once the employer of thousands of fresh MBAs, has lost key players and expects massive layoffs.
In many industries, the comfort, stability, and perks of a lifelong career with the same employer are much less common.
Large organizations may have thousands of employees, but they have only a few management-level executives and a few dozen VPs. What are the real chances of starting a career at a large organization and climbing up the corporate ladder to get a VP or C-Suite position that promises great compensation, equity options, and a golden parachute? What are the real odds of not being stuck in the dreaded mid-management tier?
2. Risks associated with college degrees
It has been common belief that – unless you are a Bill Gates, Steve Jobs, or Mark Zuckerberg — a college education is essential to a successful career.
However, college education has recently created a serious problem for young undergrads: student loan debt. Many view this issue as the next potential time bomb. The media tells horror stories about students whose college debt became a real and frightening burden.
It’s not that quality education is less important than before. However, we must acknowledge the risk of student loans. Therefore, for some youngsters just out of high school, it may make sense instead to establish a startup (as Richard Branson suggests) while taking free online classes.
Read full article on VentureBeat.com
