Greater wealth is created simply by not giving up so easy. That’s the conclusion of the data below for the 23 YC funded startups with known exit amounts. This post is a follow-up to Longevity of YC Startups From Funding Through Acquisition.
Thirteen of the 23 companies had exits at 24 months of age or less, totaling $253 million dollars and averaging $19.5m/company. The ten companies older than 24 months had exits totaling $675 million and averaging $67.5m/company. A correlation therefore exists between whether a startup’s lifespan exceeds the average and exit amount.
Two very large exits skew the amounts for the older companies, though: Heroku and OMGPOP. Heroku and OMGPOP exited at $250m and $210m, respectively. That $460 million dollars is only slightly less than the $468m sum of every other known YC acquisition amount combined. OMGPOP’s correct exit amount may only be $180m, a detail that doesn’t significantly affect the overall totals. The absence of any Heroku/OMGPOP size exits in the younger acquisitions may itself also prove the financial value of not selling out early.
Omitting Heroku and OMGPOP, the exit amounts of the 8 companies older than 24 months still totals $215 million dollars and averages $26.9m/company. The $7.4m difference over the shorter lifespan average of $19.5m is a 38% larger exit than companies acquired prior to 24 months.
So there’s generally better money to be made simply by not selling your startup prior to 24 months. Startups that exceed the average lifespan end up being acquired for over 30% more cash than those acquired in the first two years, based on this limited sample size.
| # | Company | Batch | Acquisition | Lifespan | Exit $ |
|---|---|---|---|---|---|
| 1 | Xobni | June 1, 2006 (ycs06) | July 31, 2013 | 87 months | 60m |
| 2 | Loopt | June 1, 2005 (ycs05) | March 31, 2012 | 83 months | 45m |
| 3 | OMGPOP | June 1, 2006 (ycs06) | March 31, 2012 | 71 months | 210m |
| 4 | Wufoo | January 1, 2006 (ycw06) | April 30, 2011 | 65 months | 35m |
| 5 | Posterous | June 1, 2008 (ycs08) | March 31, 2012 | 47 months | 10m |
| 6 | Zecter (Versionate) | June 1, 2007 (ycs07) | December 31, 2010 | 44 months | 25m |
| 7 | Heroku | January 1, 2008 (ycw08) | December 31, 2010 | 37 months | 250m |
| 8 | Appjet | June 1, 2007 (ycs07) | December 31, 2009 | 31 months | 10m |
| 9 | 280 North | January 1, 2008 (ycw08) | July 31, 2010 | 31 months | 20m |
| 10 | Mertado | January 1, 2010 (ycw10) | January 31, 2012 | 25 months | 10m |
| 11 | SocialPicks | June 1, 2007 (ycs07) | May 31, 2009 | 24 months | 8m |
| 12 | Cloudkick | January 1, 2009 (ycw09) | December 31, 2010 | 24 months | 50m |
| 13 | Parse | June 1, 2011 (ycs11) | April 30, 2013 | 23 months | 75m |
| 14 | Auctomatic | January 1, 2007 (ycw07) | April 30, 2008 | 16 months | 5m |
| 15 | kiko | June 1, 2005 (ycs05) | August 31, 2006 | 15 months | 0.25m |
| 16 | Sendoid | January 1, 2011 (ycw11) | March 31, 2012 | 15 months | 2m |
| 17 | AdGrok | June 1, 2010 (ycs10) | May 31, 2011 | 12 months | 8m |
| 18 | Movity | January 1, 2010 (ycw10) | December 31, 2010 | 12 months | 15m |
| 19 | Etacts | January 1, 2010 (ycw10) | December 31, 2010 | 12 months | 5m |
| 20 | Anywhere.fm | June 1, 2007 (ycs07) | January 31, 2008 | 8 months | 5m |
| 21 | Omnisio | January 1, 2008 (ycw08) | July 31, 2008 | 7 months | 15m |
| 22 | SocialCam | January 1, 2012 (ycw12) | July 31, 2012 | 7 months | 60m |
| 23 | TextPayMe | January 1, 2006 (ycw06) | July 31, 2006 | 7 months | 5m |