Here’s What Technologies Are Overhyped And Underhyped, Say Startup Founders

The results will surprise you.

Here’s What Technologies Are Overhyped And Underhyped, Say Startup Founders
[Photo: Flickr user JC Dill Photography/Tech Cocktail]

If you’re one of those naysayers who likes to attend cocktail parties and talk about how we’re in a tech bubble–(one that’s about to burst at any time!)–you’re in good company.


Here’s What the Bubble Looks Like

Two-thirds of startup founders agree that we’re in a bubble, according to this year’s State of Startups report, conducted by venture capital firm First Round, that tracks the opinions of over 500 venture-backed founders. But a founder’s outlook is shaped, in part, by the kind of company they run. Leaders of consumer-facing companies generally had a bleaker impression of the future, compared to their peers at enterprise companies who were more likely to deny the possibility of a bubble and believe they would be profitable soon.

But to add a bit more nuance to their perspective, the survey asked founders what they believed were the most overhyped and underhyped technologies on the market. The results were surprising. While founders tend to believe that people have made exaggerated claims about almost all technologies on the market, there were a few exceptions. They felt that self-driving vehicles and mobile technology were underhyped opportunities. Given that smartphones and tablets have been around for close to a decade, it’s worth noting that founders believe there are still many possibilities for growth and investment in the mobile space.

On the other hand, founders think that the vast majority of the technologies that have become buzzwords in the media–from the sharing economy to the Internet of Things to VR–are overhyped. At the very top of the list are bitcoin and wearables.

Photo: Flickr user Erfahn Haghighi/Tech Cocktail

Women Entrepreneurs Feel Investors Have The Upper Hand

Startup founders also believe that investors increasingly hold the power when it comes to negotiating deals. Sixty-three percent of those surveyed said that entrepreneurs held the upper hand over the last few years, but they believe that the dynamic is shifting. Only 46% said that entrepreneurs would have more power in the years to come.

Female founders, in particular, tended to feel more disempowered at the negotiating table and were more likely than their male counterparts to believe that investors held the cards.

Speaking of women, female-led companies are generally more diverse than those led by men. Eighty-seven percent of female-led companies have diversity initiatives in place, while only 62% of male-led companies do. And while only a quarter of male-led companies have a 50/50 gender ratio, 44% of women-led companies do.

Photo: Flickr user The Combine Photo/Tech Cocktail

The Evolving Cofounder Relationship

Another interesting finding in the report is that cofounder relationships tend to change with age. Older entrepreneurs generally have happier and more collegial relationships with their cofounders, while those who are under 30 tended to have more tempestuous relationships with their cofounders. At the same time, these younger entrepreneurs were also 33% more likely than their older counterparts to say that they were best friends with their cofounders, signaling that these partnerships were more volatile and emotional.

And across the board, founders tend to be more concerned with long-term, strategic failure and less focused on the short-term mistakes that could lead to it. For instance, the survey found that founders cared about stagnating growth, but were less worried about customer churn. They were also fixated with raising capital, but less interested in their burn rate. The report pointed out that their “strategic concerns don’t mirror their tactical priorities.”


About the author

Elizabeth Segran, Ph.D., is a staff writer at Fast Company. She lives in Cambridge, Massachusetts.