Lots of the people we coach want to know how to start a successful technology company. One approach to this difficult question is to assess which unusual traits are common among the most successful tech entrepreneurs. In this post, we review the biographies of the ten richest tech entrepreneurs.
Here is what we found:
- All attended American Universities, though only half graduated (3 to start companies but 2 dropped out before they started their companies), and none have postgraduate qualifications.
- 8 of the 10 entrepreneur’s Wikipedia page had stories or achievements demonstrating exceptional tech skills or interest in technology. (Azim Premji (Wipro) and Lawrence Ellison (Oracle)) are the only two whose Wikipedia pages do not demonstrate exceptional talent/interest in tech.
- Fewer demonstrated early interest in business – Jeff Bezos and Michael Dell being the only exceptions.
- Only three took a job after finishing university and before starting a company.
- Jeff Bezos, worked in multiple computer science-related jobs.
- Larry Ellison, worked for a data company while developing his product.
- Paul Allen, worked in programming before starting Microsoft.
- 6 people were involved with a company with more than one founder, and 4 were the sole owner of the company.
There are a few cautions with this kind of research:
- First, it may be that most of the determinants of success in technological entrepreneurship are specific to the technology e.g. Yahoo’s founders David Filo and Jerry Yang were among the first million users of the internet and so in 1994, their Guide to the Internet stood an unusually good chance of rising to popularity. We might find that lucky circumstance rather than skill is involved in many of these success stories. However, even if that is all we found, it could still be useful knowledge.
- Second, just identifying a trait that is common in successful entrepreneurs does not show that this trait has caused their success. The trait may be a side-effect of some other cause of their success, or – given the small sample size – it may have arisen randomly.
- Third, examining the top performers in a field may predominantly identify causes of high variance. For example, suppose solo founders are half as likely to succeed but when they do, they own twice as much equity. If true, then although going solo has equal expected earnings, it will increase your chances of being right at the top of the distribution. A counterpoint to this is that in technological entrepreneurship (NOTE: At least in so far as VC- and YC-funded startups are representative.), most of the expected earnings come from a tiny minority of super-successes, and founders that take risks that can have extreme outcomes may be more successful on average.
- Fourth, we note that because this is a list of individuals with the greatest net worth, it will be biased to older individuals.
This research suggests that:
- The most successful technology companies are usually founded by extremely technically apt founders.
- Being admitted to a US university is correlated with success in entrepreneurship but graduation is not, suggesting that the benefit is not derived from completing a curriculum.
- The most successful technological founders strongly favoured entrepreneurship over conventional employment.
You can read more about super-successes in entrepreneurship here.