Airbnb (EF, Thursday, Week 6)
entrepreneurial-financeyear-twoThe vast majority of firms in the U.S. have fewer than five employees. Fortune 500 corporations that we study in business school are the exception, not the rule.
About 40% of the Dow-Jones were venture-backed firms; the rest were bootstrapped or angel-backed or financed by banks.
YCombinator (and other incubators): attract unproven teams that are not far enough along to look for VC funding.
In current climate, with TONS of aspiring entrepreneurs, incubators perform an important screening function for VCs and angel investors. Bubble? Maybe...
Also, incubators are a product of the increasing size of VC funds and the rise of super-angels. Nobody in the current ecosystem was willing/able to supply small amounts of capital ($20K) to fund new ventures to reach initial information events.
How relevant are incubators to MBA founders? Theoretically don't need business savvy or institutional credibility as much as ventures with only technical or non-traditional biz founders. Maybe...