Some Venture Capital Statistics : Slide 5
The average investment per company that the venture capitalist community has made, has gone from seven million during the early 1980's to twelve million in the early 1990's. Keeping pace with inflation, it should be noted that the starter company, which includes everything, costs about ten million dollars. The technical aspects, typically, are about one-fifth of that or two million dollars.
Much more telling is the fact that the young startup venture companies
spend as much on research and development per employee than does the Fortune
500 companies. This ratio is only a factor of two with $16,000 opposed to
$8,000 per employee. The startup companies have a twenty-five percent job
growth criteria in contrast to the Fortune 500 that have approximately zero
growth criteria. Does this mean that increasing per spending on employee
R&D will create more jobs? Not necessarily so. There are, as we shall
see, eight or more criteria that contribute to the creation of wealth through
the utilization of technology. Our object, as venture capitalists, is to
make sure that at least half of our revenue will come from projects and
products that were nonexistent years ago.
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