College name could matter when it comes to startup financing

As we have discussed in previous posts, while there are many things that need to be addressed when someone is working to get a startup business off the ground, often one of the most difficult to establish is financing. A recent report indicates that for college graduates, the way in which that is accomplished could depend on the school from which they attend. This is something those seeking to start a business in the Chicago area may want to keep in mind.

The business formation report, which was published by CB Insights, covered six universities that are considered to be top-tier: Stanford, Harvard, New York University, University of California Berkeley, University of Pennsylvania, and The Massachusetts Institute of Technology.

The report looked at information from the years between 2007 and 2011. Over the course of those four years, a total of $12.6 billion was invested by venture capitals and angels in startup businesses either headed-up by or founded by graduates or individuals who at some point attended those schools.

The money was in the form of 559 funding deals. The highest number of those deals, 203, were made with individuals who attended Stanford. The money involved in these totaled $4.1 billion. Aided in large part by Facebook, Harvard reports the next largest amount of money fetched with $3.8 billion. $2 billion of that amount is attributed to Facebook.

Though New York University is not one of the top schools in the list of six, many may see that as the best place to attend. This is because, during the time period the study focused one, none of the businesses failed.

Source: Wired, "Stanford Grads Get Most Startup Cash, Harvard Counts on Facebook Effect," Sarah Mitroff, Oct. 30, 2012

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