Startup founders often wonder which traits can increase their chances of securing funding.
- Research analyzed data from over 17,000 founding teams to identify patterns in successful fundraising.
- Founders with advanced degrees, especially PhDs and MBAs, tend to secure more investment.
- Experience in founding startups or backgrounds in consulting and finance boost fundraising success.
- Having an international team and four co-founders are also beneficial traits for securing funds.
In the competitive world of startup funding, founders are eager to understand what makes some teams more successful than others. Recent analysis of data from over 17,000 founding teams reveals trends in traits associated with successful fundraising.
One advantage for founders is having an advanced degree. Data shows that PhD holders raise an average of $34.1 million, and MBA holders secure $30 million, far surpassing the $15.2 million for bachelor’s degree holders and $13.9 million for those without formal degrees.
The educational institution also plays a role. Alumni from top UK universities like Cambridge, Oxford, and London School of Economics consistently lead in total funds raised, with Cambridge alumni topping the list with $11.2 billion.
Experience in startups is another significant factor. Teams with serial founders raise around 45% more than first-time teams. Consulting experience, particularly from firms like McKinsey, Boston Consulting, and Bain & Company, also correlates with higher fundraising success.
Finance professionals from institutions such as Deutsche Bank and Morgan Stanley are well-represented among founders of successful startups, indicating the value of financial acumen.
The study highlights the benefits of international diversity within founding teams. Teams with at least one international founder raise 33% more than all-local teams, which tend to raise 13% below the baseline.
An optimal number of four co-founders is suggested by the data, with these teams raising an average of $70.5 million. This is considerably more than teams of three, two, or solo founders, who see significantly lower averages.
Bo Ilsoe from NGP Capital notes the unique European focus on academic credentials and diverse skills in founding teams, contrasting with the often tech-heavy approach of Silicon Valley. Europe’s ecosystem fosters innovation through academic and experiential diversity.
The study underscores that a combination of education, experience, and diversity significantly enhances a founding team’s fundraising success.
