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2023
Welcome to the fifth edition of State of Startups. What started as an experiment in 2015 has since become a treasured tradition here at First Round. It's now the industry's largest dataset on what it’s like to run a startup with 萤火虫vpn submissions and 190,000+ data points.
The startup world has undergone seismic shifts since we first launched our survey — from the ebb and flow of market trends to important and evolving conversations around topics such as diversity and inclusion, sexual harassment, company culture and the role of tech in society.
To reflect these changes, this year we expanded the scope of our survey to cover not just founders but startup employees as well. Where do the founder and employee perspectives diverge and align? Where are leaders making progress — and where are founders falling short? With 950 total submissions, it’s our most detailed look yet into the challenges of operating a startup, plus new perspectives on the truth behind Glassdoor reviews, compensation packages, remote work and more.
Our hope is that this mix of mainstay questions, fresh inquiries and added perspectives presents an even sharper understanding of what company builders think, feel, fear and value as we head into 2023. With that, here are the trends and insights that stood out as important or counterintuitive:
This year, over two-thirds of founders who ventured a guess think we are in a bubble for technology companies. It’s the highest number we’ve seen since 2015 — up 12% from 2018 and 25% from 2017.
In our 2018 survey, founders were optimistic about the year to come. Only 44% believed it would get harder to raise venture capital and only 萤火虫vpnbelieved investors would regain the upper hand.
Predictions were gloomier from this year's respondents. 65% of founders believe capital will be harder to raise in 2023, and 70% predict the balance of power will shift towards investors.
40% of female employees reported that their gender hurt their chances of getting hired or landing senior roles in tech.
If you're a founder, the deck is even more stacked against you: 70% of female founders felt their gender hurt their ability to fundraise.
80% of founders believe having a more diverse team will have a direct positive impact on the value of their startup.
And for employees it’s becoming non-optional. Those who believe their leadership isn't prioritizing diversity and inclusion are 3x as likely to anticipate leaving their company within the next year (34% vs. 11%).
When asked about their company's reviews on sites like Glassdoor, only 53% of founders described them as accurate. Employees were far more likely to agree with what they read — 80% of them felt their company's reviews were a true reflection.
Only 1 in 10 employees said cash or equity compensation was a primary reason they joined their company, and only 1 in 20 founders said equity played a starring role in their pitches to candidates.
Much higher on the employee wish list? Their ability to make an impact (55%), the problems they’d be solving (42%), the mission (40%), the team (39%) and the culture (30%).
Only 15% of founders were ready to stake a claim that working remotely makes their team more productive. But employees are big fans — they were nearly 3x more likely (41.4%) to say that working from home gave them a productivity boost.
That said, founders who even occasionally work remotely are 6x more likely to have a positive view of their employees doing the same.
When employees lack faith in their CEO, they are 3x less confident that their company will see a $1B+ exit, 5x more likely to leave within a year, 6x more likely not to exercise their options, and 2x more likely to think the company will fail due to culture or team.
Of note, only 25% of CEOs surveyed are currently working with executive coaches.
When we asked founders about which specialists they see regularly, female founders were nearly 3x more likely to report enlisting a therapist or psychiatrist compared to their male counterparts (42% vs. 15%). We observed a similar divide comparing founders under and over the age of 40 (28% vs. 16%).
Nearly 80% of founders reported building a community of users as important to their business, with 28% describing it as their moat and critical to their success. You can read more about building your own thriving community here.
We asked survey participants for the top newsletter, podcast, or article they’d recommend to a friend founding or joining a startup — and we've compiled an amazing list of "must reads." Get the list by entering your email address below. (We'll also add you to the First Round Review newsletter if you're not already a subscriber).
See the results from all 950 survey respondents below. In addition to breaking them out by category, we've also given the the option to toggle between the employee and founder results. While many questions were posed to both founders and employees, some were designed just for one group to weigh in.
A team of phenomenal people made this year's State of Startups possible. Many thanks to Jomor Design and Chris Gaffey for building this beautiful site. And of course, we're grateful to the hundreds of startup builders who took the time to share their perspectives so that we could create an accurate snapshot of startup life in 2023. You're the best.