Source?
I've seen data pegging startup failure rates anywhere between 50-90%, but I've never seen a credible source claim that over 99% fail.
Mathematically, no investor would be able to stay in business if 99% of their investments fail.
I'm guessing failure rates for startups that have funding or bootstrap through revenue are closer to 75%.
It's not that 99% fail, it's that well over 99% of participants fail to hit a $1m payout. Top founders and early VC, as well as key executive hires, may win. For staff, including early engineering hires, "a good year" is a more likely outcome, after 2-6 years, or more, of sweat equity. Payout of 5-6 figures.
> "If you're an employee, you're the engineer making $100K in OP's comment."
Except when you're not. I can't count how many times people I've met have been suckered into taking substantial pay cuts for not a lot of equity.
It's a real facepalm moment - what do you mean you're giving up $40K+ a year in salary. Did you know that even if your startup hits all of its wildest dreams you'll cash out for $80-100K after about 5 years? How in the world did that math ever make sense?!
I flat out refuse to talk to any founders that try to swindle people like this. Either put more equity on the table or pay me market. Quit relying on a tired lie.
The thing as always is how you define failure and success. Do all the founders of a startup that is considered a success make $10M? Of course not. In my opinion, that's where the "it's a lot less than 1%" might come from.
