What do the Best Founders Look Like Before They’re Founders?
By Matt Clifford, EF Co-Founder
We’re fortunate at Entrepreneur First (EF) to have what I believe is the world’s largest and most comprehensive dataset of what great founders look like before they become founders.
That’s partly because we invest at scale — over 400 individual alumni and 140+ investments and counting — but mainly because we’re the only organisation (to my knowledge) that begins pre-company with the individual and collects data all the way through the team building, idea generation and growth processes.
As a result, we’ve learned a lot about what the best founders look like at the very beginning — before their company even exists. We’ve used that information to shape our programme and we want to share some of it here. In particular, we want to talk a little about how who and what we’re looking for in applications has changed over the last five years.
Entrepreneur First is not a grad scheme
Entrepreneur First started five years ago with a strong focus on recent graduates. Today, that’s almost completely disappeared. It’s likely that less than 20% of our next London cohort will be people who graduated with a bachelors degree in the last two years. By contrast, over a third will have a PhD (the figure is more than half in Singapore) and many will have a decade or more of work experience. In the last year, people left jobs at Google, Microsoft Research, Amazon, Palantir, Goldman Sachs and many other employers to join us. The average age of the London cohort has increased by about a year each year since we began; it’s now over 28, with many significantly older.
Edge and experience
Why the change? Primarily because our data shows that the most successful founders have a distinct edge in a dimension that’s relevant to the company they start — and we’ve found that edge takes time to develop. My co-founder Alice has discussed edge at much greater length here and here, but in short we’ve found that the people who do best at EF have a clear technical, productor domain edge:
Technical: Many of our most exciting companies are built on top of complex, defensible technology. Magic Pony Technology is the most obvious case, but there are dozens of others in the portfolio. These companies usually require a founder with a PhD or other deep research experience in a relevant area (see, for example, Bloomsbury, Kheiron or Petagene). This is one reason why on average people with a technical PhD are twice as likely to be offered a place at EF.
Domain: Our data suggests that ideation is both quicker and more robust if one of the founders has significant expertise and a strong network in the field that their startup plans to enter (or disrupt). It’s very difficult to acquire the necessary experience in less than a few years (we think two to five seems about right, but we have several promising startups where the founders have considerably more). EF companies like Calipsa and Brolly came out of their founders’ domain expertise. We expect to fund many more domain experts in future, whether they have technical backgrounds or not. (Right now, I’m especially interested in genomics, security, autonomous vehicles, energy and politics and would love to talk to domain experts in those areas.)
Product: We’ve found that people with experience building and shipping significant tech products are more likely to be funded by us and by external investors. Moreover, we find that people who have worked in engineering or product roles in industry tend (subjectively) to have stronger commercial and product intuitions. Cleo, Automata and Status Today are great examples of EF startups built by teams with real product experience.
For all three edges, we’ve found that some experience helps and this has shaped the way we recruit and select our cohorts.
What should recent graduates do?
What does this mean for recent graduates who are interested in becoming founders?
First, we still want to fund truly exceptional recent graduates as soon as they feel ready — and sometimes that’s quite legitimately right at the start of their careers. The bar, though, is very high. Someone like Rob Bishop, co-founder and CEO of Magic Pony, I’d want to fund at any age — but he’s one of the most unusually mature and strategic people I’ve met. It’s also worth reflecting on what his track record looked like by the time he formally graduated: he’d already done four years of internships at Broadcom, taken a sabbatical to be one of the first employees at Raspberry Pi, and been invited to give talks at large industry conferences.
There are many other founders in the portfolio about whom we feel similarly — and when we look at what they have in common as graduates, it’s best summarised as: insane levels of ambition and extreme self-confidence coupled with significant (if early) evidence that it’s well placed. If that’s you, we’ll always want to hear from you, whatever your age.
More broadly, the best advice for any aspiring founder is to work on your edge — whether that’s developing deep technical skill or industry experience.
And don’t lose sight of your goal: I stand by my previous advice on not getting distracted by ‘badges’ and erring on the side of getting started.