Startup and Tech Ecosystem Definitions, and Why They Matter
What exactly is a startup? How is Google still a startup? When does a startup become a scaleup? And why do these definitions even matter?
In this discussion, Yoram Wijngaarde and Orla Browne join Andrii Degeler to explain how Dealroom defines startups and scaleups, as well as different company stages depending on the latest funding round. The thinking behind it goes well beyond simple metrics like company age or employee count — and allows us to better understand the ecosystem.
Here are a few things discussed in this video:
– Why Paul Graham’s famous definition “a company designed to grow fast” is just the starting point
– How to categorise startups through their journey from inception to billion-dollar valuations
– Why only 0.3% of startups create two-thirds of all economic value
– The surprising data on bootstrap unicorns vs VC-backed companies
– Why decacorns and hectocorns are essential for innovation and economic growth
00:00 Why are we talking about startup definitions?
01:35 Paul Graham’s startup definition as a starting point
04:27 Startup stages framework
09:05 Funding rounds framework
13:37 Valuation and headcount of European startups per stage
15:24 Why do startups matter?
18:26 Very few startups make it big
22:55 Why startup definitions matter
24:00 The startup ecosystem funnel
26:38 Let’s talk about bootstrapping
29:30 Of colts, thoroughbreds, and unicorns
34:27 How many “former unicorns” are there?
37:18 Venture capital math: Why do unicorns matter?
44:00 Examples of the definitions framework applied
51:30 Why you want to raise from a top-tier VC