Unicorn Breeders

The startup economy is booming and unicorns, private companies with post-money valuations of $1 billion or more, are cropping up across the country. We took a deeper look at the entrepreneurs that built these companies and which colleges and universities shaped them for their success. What do these schools have in common? How do the […]

BY GoodCall

Unicorn Breeders

The startup economy is booming and unicorns, private companies with post-money valuations of $1 billion or more, are cropping up across the country. We took a deeper look at the entrepreneurs that built these companies and which colleges and universities shaped them for their success. What do these schools have in common? How do the educational attainment levels of female founders differ from that of men? Which schools are behind the most valuable unicorns in the country?

Key Findings:

  • Only 3% of all U.S. higher education institutions breed 90% of today’s unicorn founders.
  • There are a disproportionate number of male and female unicorn founders and male founders typically carry a higher level of degree.
  • The most valuable U.S. unicorns are mostly founded by alumni from private institutions including Stanford, MIT, Harvard and Yale.

Which schools are breeding the most unicorn founders?

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Top 5 Private Schools for Unicorn Founder Alumni

Stanford University has a lot to be proud of – like 38 alumni who went on to found companies now considered unicorns. That’s nearly double the next highest school on the GoodCall list. The school, founded in 1891 in Stanford, Calif., by Leland and Jane Stanford in honor of their son who died, can claim as alumni the founders of three of the most successful startups: Palantir Technologies (founded by Peter Thiel, Joe Lonsdale, Stephen Cohen, Garry Tan, and Alexander Karp), Snapchat (founded by Bobby Murphy and Evan Spiegel), and Elon Musk, founder of SpaceX. Other founders whose companies you might recognize are Dhiraj Mukherjee and Avery Wang (Shazam), Alexander Asseily and Hosain Rahman (Jawbone), and Kevin Hartz (Eventbrite). But if you’re thinking about jumping on board the Stanford bandwagon, be aware that Stanford is the most selective school in the country, with only 4.8% of undergraduate applicants admitted in fall 2016.

The oldest college in the country, Harvard University, can claim 21 unicorn founders. Alumnus Nathan Blecharczyk is one of three founders of Airbnb, the second most valuable company on the unicorns list (It’s worth $30 billion). Other alumni include Matt Salzberg, one of three who founded Blue Apron; Sarah Leary, one of the Nextdoor founders; Michelle Zatlyn and Matthew Prince, of Cloudflare; Jason Kilar, co-founder of Hulu; and Ric Elias, of Red Ventures. The school in Cambridge, Mass., is ranked No. 1 in best value schools and as the No. 2 best university nationally by U.S. News & World Report. Only 5.3% of undergraduate applicants were admitted in fall 2016, making Harvard the second-most selective school in the country. But Harvard has a long history of producing successful graduates – 8 U.S. presidents and 24 other world leaders, 48 Pulitzer Prize winners and 48 Nobel Laureates.

Ten unicorn founders attended Stanford’s Graduate School of Business, ranked as the No. 2 best business school in the country by U.S. News. The four founders of SoFi, the student loan refinancing website, all earned a degree from the business school – Ian Brady, Daniel Macklin, Michael Cagney, and James Finnigan. Borge Hald and Amy Pressman, co-founders of Medallia, are also among the alumni. Stanford Business reported its Class of 2016 set record salaries for both average ($140,553) and median ($136,000) earnings. That’s 5% higher than the previous year’s record high. The school is also tied for the highest ranked spot on U.S. News’ list of Best Graduate Schools for Entrepreneurship.

Known as one the best schools for innovation, Massachusetts Institute of Technology has 10 grads who went on to found current unicorn companies. Among the most known are Drew Houston and Arash Ferdowsi, who created Dropbox (now worth more than $10 billion), and Jonah Peretti, one of the founders of BuzzFeed. Stripe is an online payment management system valued at $5 billion; it was founded by MIT grad Patrick Collison and his brother John. MIT, founded in 1861, is another of the most exclusive colleges in the country. It accepted just 7.9% of its 19,020 applicants for fall 2016. In addition to its unicorn founders, the school in Cambridge, Mass., boasts 86 Nobel Laureates and 58 National Medal of Science winners.

The No. 1 business school in the country, as ranked by U.S. News, is Harvard Business School. It’s no surprise, then, that the school counts nine current unicorn founders among its alumni. In addition to founders of Blue Apron, Nextdoor, Red Ventures, Hulu, and Cloudflare, Harvard Business grads Kevin Nazemi and Mario Schlosser, both of Oscar, and Stephane Bancel, of Moderna Therapeutics, also went on to found billion-dollar startups. The school, nestled in Boston just across the Charles River from the university’s main Cambridge campus, reported an 11% admissions rate for its Class of 2018, and 43% of those were women.

Despite the perception that the most successful entrepreneurs are ivy league educated in business and economics, 28% of the degrees attained on our list came from public institutionsincluding 2 community colleges, a culinary college and various art and design schools- with degree subjects ranging in everything from Art History to Behavioral Psychology.

Top 5 Public Schools for Unicorn Founder Alumni

The University of California, Berkeley, is known for being different – the annual “naked run” before finals week and its longstanding record of political activism are only two examples. Founded in 1868, it now also is generally recognized as the top public university in the U.S. Seven current faculty members are among the 22 Nobel Prize winners who have taught at the school; in all, 29 alumni have won the award. The great academics and research also have played a role in Berkeley’s high status on the unicorns list – 12 alumni founded eight of the $1 billion privately held companies currently considered U.S. unicorns. Among the most notable: father-and-son alumni Orion and David Hindawi, founders of cybersecurity company Tanium; Kevin Chou, Mike Li and Holly Liu, co-founders of online gaming company Kabam; and David Gilboa, co-founder of eyewear maker Warby Parker. Standards are high; Berkeley accepts only 17.5% of applicants.

“UC Berkeley’s ability to foster and support successful student entrepreneurs flows from a powerful blend of essential elements on our campus: faculty and students who are greatly motivated by our public-serving mission to tackle the grand challenges facing society and having what they do make a positive impact on the world; both deep and broad academic scholarship and research excellence at scale; a willingness and ability of both faculty and students to work across disciplinary boundaries to create new synergies and solutions that help solve the world’s most pressing problems; and a wide array of programs that integrate entrepreneurial and innovative thinking into the student experience.” -Dr. Paul Alivisatos, UC Berkeley’s Vice Chancellor for Research.

The University of Illinois at Urbana-Champaign, established in 1867, spent nearly three-quarters of a billion on R&D and engineering in 2013, the most recent year for which information is available. So it’s no wonder, given all that emphasis on research, that the university has produced six alumni who started four current U.S.-based unicorns. Albert Goldstein, Paul Zhang and John Sun co-founded online personal loan arranger Avant; Nick Ganju founded online medical care scheduling service Zocdoc; Mark Zdeblick co-founded Proteus Digital Health, which makes ingestible sensors and other technology designed to help health care providers monitor patients; and K.R. Sridhar started Bloom Energy, which generates clean energy using fuel cell technology. It accepted 59% of applicants in 2014. Chancellor Robert J. Jones of the University of Illinois at Urbana-Champaign says there are three key reasons why so many graduates establish themselves as entrepreneurial leaders across a whole range of industries:

“It starts with our faculty. Across the spectrum of our colleges and disciplines they bring an entrepreneurial spirit into their research and into their teaching. Our students interact with them from first day of their Illinois experience through graduation and quite often long after they leave Urbana.

The second factor is the ease with which people cross traditional boundaries and disciplinary lines. We are very well known as a university where there are few boundaries to collaboration. You have instant access to experts in nearly any field sitting just a couple blocks away. And our students see this modeled every day – in and out of the classroom.

And the final major contributor is the quality of those students who choose to come to Illinois. They’re academically talented. But they aren’t just looking for a degree, they want to make a difference. And they are very impatient to get started on that road.

When you put all of these together you get an environment that doesn’t just foster an entrepreneurial spirit – it embeds it in every aspect of the educational experience.”

Top entrepreneurial universities don’t generally have great football teams – the University of Washington, currently one of the contenders for the college football playoffs – is an exception. But the academics also are stellar at UW, founded in 1861. The faculty includes seven Nobel and two Pulitzer prize winners. As for entrepreneurship, three alumni were involved in founding current unicorns. Tom Gonser founded DocuSign, which offers online signature technology; Christopher Bisciglia co-founded Cloudera, which provides Apache Hadoop analytics software as well as training, support and services for it; and Arean van Veelen started OfferUp, an online marketplace for buyers and sellers. “In FY16, CoMotion, UW’s collaborative innovation hub, launched 21 new startups. CoMotion is dedicated to expanding the societal impact of the UW community. By developing and connecting local and global innovation ecosystems, CoMotion helps innovators achieve the greatest impact from their discoveries,” said Donna O’Neill, Marketing and Communications for University of Washington’s CoMotion Innovation Center.

The University of California, Los Angeles, more commonly known as UCLA, claims to be the most-applied to college in the U.S. – more than 92,000 freshman applications were received in 2015. The university, a relative newcomer founded in 1919, also says its students have won 261 Olympic medals – the most of any school. When it comes to producing another type of gold, three alumni started the same number of current unicorns, including one you’ve probably used and another with major star power. That would be the transportation app Uber, co-founded by Travis Kalanick. Others include The Honest Company, a consumer goods company focusing on non-toxic household goods founded by a group that includes UCLA alum Brian Lee and actress Jessica Alba, and gaming company Kabam, co-founded by Holly Liu, who earned her bachelor’s at UCLA and her master’s at the University of California, Berkeley. With all those applicants, you’d expect UCLA to be selective – and it is. Only about 18% are accepted.

The Haas School of Business at the University of California, Berkeley, established in 1898, is the nation’s second-oldest business school (behind the University of Pennsylvania’s Wharton School of Business). But age doesn’t define it: Haas is frequently cited as one of the country’s best business schools. Three graduates started two current unicorns. Chris Barton and Philip Inghelbrecht are among the co-founders of Shazam, which makes a popular music-identification app. Kevin Chou is one of the entrepreneurs who started Kabam. The school is particular about admissions. Only 14.1 percent of the students who applied for the fall 2016 semester were accepted. Aside from academic rigor, it seeks students who embody its defining principles: question the status quo, confidence without attitude, students always, and beyond yourself.

The Gender Breakdown: Do male and female unicorn founders attend the most prestigious universities equally?

Do they earn the same types of degrees?

The majority of female unicorn founders in our study earned a graduate degree as their highest level of education while the greatest concentration of male unicorn founders earned undergraduate degrees as their highest level of education.  However 18% of the male founders earned a post-graduate degree while none of the women did. 16.7% of the female founders on our list had no college degree while only 4.74% of male founders had the same.

Overall, female unicorn founders are hard to come by.

Female founders are greatly underrepresented in the land of unicorns. Male unicorn founders outnumber female unicorn founders 20 to 1. How do we close that gender gap? Danielle Letayf of AOL’s #BUILTBYGIRLS says what young women need more than anything, is mentorship:

Most valuable unicorns — which schools breed the best in show?

While the most valuable unicorns are typically founded by alumni from private U.S. institutions such as Stanford, Harvard and MIT, a few public colleges made the list including College of William and Mary and University of North Carolina at Chapel Hill.

Why Stanford Stands Out:

“Stanford Graduate School of Business (GSB) empowers students and alumni to make a positive, measurable difference in the world through its unique and innovative management education approach. This experience creates a transformative journey that equips individuals to find new potential and pathways to change lives, change organizations and change the world.”

“Our students and alumni benefit from a diverse community, world-renowned faculty, consciously global orientation and culture of cross-disciplinary collaboration. Faculty members are leaders and pioneers, serving the dual mission of rigorous disciplinary research and professional teaching. Students develop an awareness of global issues and the international economy from interacting with individuals from around the globe as well as participating in programs offered worldwide. Stanford GSB’s culture supports cross-disciplinary programs and learning across Stanford University’s seven world-class schools – all within walking distance of the GSB.”

“We offer our students several opportunities to help de-mystify entrepreneurship. Entrepreneurship is not for everyone and our goal is to help our students discover whether it is right for them while they are here. With courses such as Formation of New Ventures and Managing Growing Enterprises, our students learn the nuts and bolts of entrepreneurship. Experiential courses and co-curricular activities such as Startup Garage, Venture Studio and the Entrepreneurial Summer Program enable our students to experience entrepreneurship. These programs and courses help our students be more informed and prepared as future entrepreneurs.”

-Stefanos Zenios
Professor of Entrepreneurship and Professor of Operations, Information & Technology
Stanford Graduate School of Business

Full List of U.S. Colleges and Universities by Number of Unicorn Founder Alumni

GoodCall researched the founders of current U.S. unicorns as reported by TechCrunch in Q3 2016. Educational information about founders was pulled from a wide range of online resources including online profiles and Wikipedia. If any information in the report needs to be corrected please email team@goodcall.com.