70% of US start-ups say they have no women on their boards

Despite lack of diversity, start ups optimistic about 2017 outlook

Silicon Valley Bank has released its eighth annual Startup Outlook report. The U.S. report is based on SVB’s survey of more than 550 executives at technology and healthcare startups in the U.S. and examines their insights on business conditions, fundraising, hiring and public policy issues, including the impact of regulation, taxes and immigration policy.

An expanded series of reports offers international perspectives from startup leaders in the U.K. and China. Nearly 950 executives in total completed the annual survey that is intended to take the pulse of startups around the world.

“There is more potential now for innovation than in the last 25 years, despite some political uncertainty in the U.S. and abroad,” said Greg Becker, President and CEO of Silicon Valley Bank. “We can attribute this to the breadth of opportunity created by old world industries that are being transformed by technology globally – whether you are in San Francisco or Shanghai, Berlin or Boston.”

Becker said, “This year’s survey shows that access to talent is a persistent challenge for startups. Although the stat dropped slightly this year, 90 percent still say it is challenging to find the talent they need to grow their business. With this in mind, changes to immigration policy have the potential to add a new complexity. One-quarter of the U.S. startups we surveyed indicate existing government policies caused them to move operations overseas, and of those, 38% cited U.S. immigration policy as the reason. It’s in the best interest of the U.S. to focus on both education and high-skilled immigration to increase the skilled talent pool for these job-creating companies.”

The Startup Outlook survey was conducted in November 2016 immediately after the U.S. presidential election. Most respondents are startup executives of companies with fewer than 50 employees and less than $10 million in annual revenue:

Business Conditions
  • 57 percent of executives believe U.S. business conditions will be stronger than 2016; the number of respondents who think conditions will improve year over year has declined by 25 percentage points since 2014
  • 88 percent say raising money is “challenging” or “extremely challenging,” an increase over the previous three years
  • 51 percent of startups say their next source of funds is most likely to be venture capital
  • 50 percent say they expect more M&As to occur this year, up 7 percentage points from 2016
  • 53 percent of companies view an acquisition as their long-term exit strategy, while 16 percent are planning for an eventual IPO
Hiring & Diversity
  • 90 percent say that finding appropriate talent is difficult, down five percentage points from 2016
  • 70 percent say they do not have women on their boards and 54 percent employ no women in executive positions
Public Policy
  • While access to talent remains the top policy concern, healthcare costs moved up and is now the second most-cited policy issue
  • 26 percent of respondents say that regulations prompted them to locate facilities or move non-sales operations outside the U.S.; the top reasons were immigration policy (38 percent), tax policy (32 percent) and the regulatory environment (30 percent)

View the full US study, or  the UK and China Studies

(Infographic: SVB)