I recently ran into someone in the Seattle startup scene and began chatting about the doers and the DOERS. This person was chatting about all the people that are coming to networking events and that it was a great sign for the startup community. To which I agreed, but stated that there is a very real demarcation between the networkers (doers) and the entrepreneurs (DOERS). My point was that the conversion rate from doers to DOERS is probably less than 1%…
Start with:
3MM people in the Seattle region
5% are interested in startups (15,000)
2.9% actually start a company
= 410 of Startups (tech – from the Seattle 2.0 list)
This means that 0.01% of people go on to start a tech company in any given year… This number is even lower if you take out the number that were started in a given year.
So, what is the best way to spur more entrepreneurship? Grow your home grown talent? Bring other entrepreneurs to Seattle (or where ever it is that you live)? Don’t even try?
In my conversation, I said that less than 1% of people that come to events will ever start a company. I stand by that claim.
Caveats:
- Yea, these numbers are rough
- Many, many more companies are started that are non-tech
- I am focusing on tech related startups as those have the potential to scale more quickly than other businesses
About Nathan Kaiser
You are probably right about the number that convert – but the activity at the networking events is a different calculation…
If you take a real tech/entrepreneural event (not a social media event) – and figure out how many attendees start a company, work for a startup, or provide services to a startup – I think the percentage is much higher than 1%.
Of course if all of the doers actually converted into DOERS – we may see more failed startups which may or may not be a good thing
Excellent points Nathan.
Because of a recent episode on my life I started to think of the people who have been going to startup networking events for years, but have yet to do anything related to startup. I think they don’t even realize what they are doing anymore. They just like to hang out with the crowd. That is not a big deal and I enjoy them (the fun people at least). The big deal is when they call themselves “entrepreneurs” or “startupers”. Riiight…