More SA startups that have both male and female founders are generating significant revenue or turning a profit — than are those with only male or only female founders — a new survey has found.
The 2018 Ventureburn Tech Startup Survey powered by Telkom Futuremakers, reveals that of 153 tech startups quizzed online, 41% of those that have both male and females among their founders (startups like SweepSouth which was founded by husband and wife team Alen Ribic and Aisha Pandor, pictured above) report that they are successful.
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In comparison, 25% that have just men as founders and 20% with just women are generating significant revenue or turning a profit.
The finding could in part be related to the number of founders a startup has — as in general those with two or more founders were more likely to report generating significant revenue or turning a profit, than those that only have one founder (29% versus 20%, respectively) .
While just 10% of 153 startups surveyed reported making a profit, just over a quarter (27%) can be termed “successful”, in that they are either generating a profit or growing.
White founders based in Western Cape more successful
When it comes to race, more white founders report being successful – in all 59% of startups who say they are successful are run white-owned firms (2017: 65%).
Taken by race group – 40% (2017: 36%) of white founders report being successful, compared to just 19% of black startups (2017: 13%) (and just 13% of black-African founders, up from 10% in 2017).
About 36% (2017: 32%) of startup founders in the Western Cape say they are successful – compared to 23% (2017: 22%) in Gauteng who list themselves as successful.
It helps to be older too. Most successful founders are over the age of 40 or between 30 and 35 years old. In all, 38% of startup founders in these ages groups say they are successful (2017:36%). Most also run either a fintech or insurtech or a Software as a Service (SaaS) startup.
It goes without saying that more established startups are more likely to be successful. In all, 55% of founders who run startups that are two or more years old say they are successful versus just 11% under two years old.
B2B startups – those that service other businesses, rather than consumers — are more successful than those that service only consumers (B2C). In all, 32% of B2B firms say they are successful versus 23% of B2Cs.
In addition, those that tap the North American or European market are also more successful, than those that target only South Africa or only the African continent.
Is having run startups previously a predictor of success?
Finally – are you more likely to be successful if you have run other startups before? In short, not necessarily.
Data from the survey reveals that 28% (2017:33%) of founders who have run one or more startups previously report being successful with their current business – not overly different from the 25% (2017: 30%) who have never run a business before and say they are successful.
However, there appears to be some correlation with the number of startups a founder has run as a predictor of success.
Fifty percent of those who have run five or more startups report that they are successful with their current firm – compared to 29% of those that have run one to four startups before.
*Note on the methodology the survey used: In all there were 169 respondents to the survey which was conducted using an online questionnaire, by data analytics firm Qurio. Of this number, 16 respondents were found to be employees of startups (rather than founders) and were excluded. The survey therefore sampled 153 startup founders.
To ensure the integrity of the data, PwC will be involved to perform specified procedures, the results of which will be included in a report that will be available for inspection upon request.
More information on the Ventureburn Startup Survey:
Gauteng home to most tech startups, but Cape firms still more successful – survey
Black tech startups in SA still struggling finds new Ventureburn survey
SA tech startups still out of touch when getting angel, VC funding – survey
Infographic: the 2018 Ventureburn Tech Startup Survey
View the full 2018 Ventureburn Tech Startup Survey presentation
Featured image: SweepSouth co-founders Aisha Pandor and Alen Ribic