How to Predict a Start-up’s Success? Quantify its Buzz


Anyone trying to wade through a site like TechCrunch, hoping for a bird’s eye view of start-up activity, has probably left unsatisfied. There’s simply too much unsorted information. YouNoodle aims to change that, and it just released a ranking of 25,000 startups.

When the site fist launched last year, it assigned each startup a quantitative score based on the backgrounds, track records, and social connections of its founders. But this new ranking is different: The ranks are created by tracking media mentions, as well as shout-outs on sites such as Technorati and CrunchBase. It’s a prediction market for startups—somewhat similar to the Industry Standard or Killer Startups.

Could the so-called wisdom of crowds beat out the best guesses from sage venture capitalists? Critics say that start-up success is inherently unpredictable, and that the blunt data points available to YouNoodle underestimate the intangibles that make start-ups succeed. Meanwhile, YouNoodle has an interesting business model: It wants to license more in-depth data to VC’s and investors, who are apt to be lured by the promise of quantitative measures of buzz. But are there enough of them, and is the data good enough, to create meaningful revenues? Stay tuned.

[Via Tech Review]CK