Study: Only 4 percent of Israeli start-ups succeed

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January 28, 2015 18:51

 
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Only 4% of Israeli start-ups ultimately succeed, according to a study conducted by IVC Research Center and REVERSEXIT.

The study, which examined over 10,000 Israeli startups founded between 1999 and 2014, found that 46% had closed and were no longer active. About 14% of those had been acquired, but only half of them (303) were acquired at a profit, and thus considered successful.

Among the 5,400 companies that remain active, just 2.5% are considered “successful” by the study’s authors, who put the bar rather high in defining success: annual revenues of $100 million or employing over 100 people. The number rose to six percent if the threshold was lowered to $50 m. and companies that run on sales.

"According to most entrepreneurs, success is the realization of a business idea, a dream or technological innovation and its concrete implementation into a real business,” explained Koby Simana, CEO of IVC Research Center. “Among younger entrepreneurs, we also found the wish to 'hit it big time' that is, to build a startup and sell it for a significant profit, although this view did not represent the majority.”

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