Analysis of Founder Background as a Predictor for Start-up Success in Achieving Successive Fundraising Rounds

Abstract

The culture of Silicon Valley has created some of the most valuable companies in the world. Successful start-ups build on these companies' innovations, becoming large tech firms themselves. This paper first explores start-up history and contextual reasons for why this might be the case. We then attempt to measure the effect of working in what we define as “Big Tech” before forming a start-up. To do so, we use a series of logistic regression and multivariate logistic regression models based on firm, founder, and funding round data from the CrunchBase database. We show that working in Big Tech leads to more successful outcomes and fewer negative outcomes in the likelihood of raising venture capital but has limited to no effects beyond the funding pipeline