Blodget Kills The Term “Startup”

Before I rip, I’d like to say that the growth that Silicon Alley Inisder (SAI) has seen since their launch is amazing and eye-popping. In less than a year they have already pushed into the Technorati top 50 blogs online and their traffic growth has been spectacular. In a chat with Federated Media VP Neil Chase, he called the blog an, "amazing story." Hats off to them!

Now let’s get down to this discussion about their latest list. They are out today with their, "SAI 25: The World’s Most Valuable Digital Startups." Clearly this is a linkbait list and it’s worked. Erick Schonfeld at Techcrunch takes a look at the valuations and calls the list a "guessing game." Erick suggests that the list is based on the top 25 private Web companies. Perhaps that would have been a better name for the list but clearly wouldn’t be as sexy as to rip off the "startup" moniker.

I asked the CN readers back in January how they define the term "startup" and most seemed to suggest it was based on time, funding, ipo, etc. But c’mon Blodget, Kafka, Frommer, is Facebook really still a startup? Funding in the $300 million range, hundreds of employees, worldwide offices and they are a startup?

I’ve read all the pages on the site (your welcome Sun) and I don’t see any definition of startup. It’d be great to learn how you decided who to list and who got left off. Even at the most basic definition, once you raise a considerable amount of funding, startup no longer applies.

Here are just a few of the hundreds of real startups here in NYC alone: BricaBox, BeenVerified, UpNext, Hakia, Aviary, KickApps, Magnify.net, Snooth, Blip and Mogulus.

Other notes:

• I like how Powerset made it into the Top 50 — sans the TC pimpings, no one would even know about this un-launched startup.
• Mahalo at $150 mil? Where’s the calculation for this?
• Isn’t TheLadders a SAI company? Live 4 years, hundreds of employees, etc.?
• No eBuddy, Meebo, Zoho, Prosper, PlentyofFish, CafeMom? I could go on for hours…

It is good to see some non-U.S. companies on the list and I applaud your efforts to try to determine valuations on companies where English isn’t the first language. Overall though, I am disappointed and was looking forward to this list to see what the SAI team came up with. Perhaps CN will need to put together a call for the top 25 "real" startups.