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These are the slides of a talk Simeon Simeonov, technology partner at Polaris Venture Partners gave in front of the Yankee Group analyst team.
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Strategies for Startup SuccessSim Simeonov
Polaris Venture Partners
sim@polarisventures.comhttp://simeons.wordpress.com
The wiser speakers refused to talk on this subject
The same strategies that have the highest probability of
extreme success also have the highest probability of extreme
failure--Guy Kawasaki
http://simeons.wordpress.com/2007/02/21/guy-kawasaki-why-good-strategies-fail/
How much risk did PayPal take on?
Livingston, Jessica. Founders At Work. p6 (interview with Max Levchin)
Poor analysis of the wrong data in a mythological context
• Limited or inaccurate data• Correlation vs. causation• Omitted variable bias• Sensationalism
Most of the industry’s effort is spent analyzing successes
Revisionist history due to egocentric ex post facto
analysis
Why Did YouTube Succeed?
http://www.youtube.com/watch?v=nssfmTo7SZg (talk by YouTube co-founder Jawed Karim)
Success is often the result ofavoiding failure by will or luck
Why Do Startups Succeed and Fail?
Sim SimeonovPolaris Venture Partners
sim@polarisventures.comhttp://simeons.wordpress.com
The more thoughtful speakers refused to talk on this subject
What do “success” and “failure” mean?
Company “A” raises $100+M of institutional capital and goes
public at $2.4B valuation
Company “F” raises $2M and sells for $20M
Company “M” raises 500K and shuts down six months later
• Innovation?• Market share?• Revenues?• Impact?
• Employees?• Execs?• Founders?• Angel investors?• Institutional investors?
Efficient experimentation is critical to any evolutionary
system
Success and failure are notuseful analysis targets
The Startup Environment
Sim SimeonovPolaris Venture Partners
sim@polarisventures.comhttp://simeons.wordpress.com
Emily is a helluva persuader
• Experienced investors• National focus• $3B under management• Diversified across stage & sectors• Active partner with entrepreneurs• Great track record
The technology industry has changed substantially in the
past few years
Technology
$1,000M $1,000M
$100M$100M
$10M$40M
The leaderThe #3 player
Winners used to be selected by the market. Now they are
anointed through M&A
How successful would Flickr have been without Yahoo?
Sustainable differentiation and solid execution
• Superior execution• Cut the right deal(s)• Network effects
Protectable technology enables a defensible business model
It is the best of times, it is the worst of times
Sim SimeonovPolaris Venture Partners
sim@polarisventures.comhttp://simeons.wordpress.com
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