The Importance of Startups

While 90% of startups fail, those that succeed have an outsized impact.

April 30, 2025

Ben Young,

As we look at small business this month, it’s important to note the the contribution of startups and Georgia’s startup-friendly ecosystem. Startups comprised some 8.9% of all firms in the U.S. in 2021 – the highest share since the Great Recession.

Startups and small businesses are sometimes confused. The latter is generally defined by having fewer than 500 employees, while the former is defined as a young business – sometimes less than a year old. Generally, small business owners tend to fill a gap and are in it for the long haul; many prefer remaining a small business to growing or franchising into a larger enterprise.

Startups, however, are often formed with the intention of going public or being sold, ideally within a three- to five-year turnaround, at the highest valuation possible. While 90% of startups fail, those that succeed have an outsized impact. Recently Georgia has produced several unicorns – startups valued at over $1 billion – including Greenlight, Calendly and Aptos.

There is a willingness of entrepreneurs in Atlanta to invest in new startups, and as a result they have a major impact on job creation – even more than that of Fortune 500 companies, according to the Metro Atlanta Chamber’s Chief Innovation and Marketing Officer Alex Gonzalez. He agrees that the way startups are accessing capital is changing, saying there are cases where it’s preferable to let the customers bring the revenue first, similar to a small business model. These nuances make it important for entrepreneurs to stay on their toes.

Photo credit: Ronald Carreño

Georgia is fertile ground for startups these days. According to Johnson Cook at Greenlight, geography is not an issue for national venture capital firms any longer. Atlanta has historically been a desert for early-stage investment, but easy access to data from Equifax and banking companies coupled with remote working has made it more competitive. Atlanta is one of the most promising regions for creating a more equitable venture capital market. Across the U.S., just 22% of venture capital firms are women-led and just 10% are minority-led. Comparatively, 32% of Atlanta VC firms are women-led and nearly 23% are minority-led, according to a 2021 data-driven profile by differentfunds.com.

Atlanta also boasts a healthy ecosystem of higher education and corporate innovation infrastructure with centers like BlackRock’s iHub and Chick-fil-A’s Technology Innovation Center.

In the entrepreneurial scene, the Metro Atlanta Chamber in partnership with tech entrepreneur David Cummings has created the Atlanta Growth Collective for a selective group of startup leaders. Its advisory board consists of established and serial entrepreneurs and CEOs of midsized startups with revenues starting at $10 million. Discussion topics in the group include capital building and fundraising strategies, talent management, partnership development and more.

Each year the city hosts Venture Atlanta, which has helped companies raise more than $1.3 billion in funding since 2002, according to Business News Daily.

Other resources for startups include the Entrepreneurs’ Organization, a global network with a chapter in Atlanta that serves the state. It offers an accelerator to help early-stage entrepreneurs get from as little as $250,000 revenue to $1 million.

Young Presidents Organization has an Atlanta chapter, connecting Atlanta to a global network of over 35,000 members.

Georgia Tech’s ATDC, the state’s incubator and a model for incubators nationwide, has generated a whopping $12 billion in revenue through startups since its founding in 1980. Georgia Tech also hosts the Enterprise Innovation Institute, with staff in 12 locations throughout the state, which helped secure $1.4 billion in capital investments in 2021. The institute’s Center for Economic Development Research has implemented a Certified Economic Development Ready Communities program that helps communities plan for the impact of economic development. The institute’s Partnership for Inclusive Innovation received a $350,000 grant to help fund summer internships in 15 distressed counties.

In Athens, the University of Georgia’s Delta Innovation Hub is home to alumni- and faculty-owned startups. In 2022, Dalan Animal Health moved into the hub and, collaborating with researchers at UGA’s College of Agricultural and Environmental Sciences and the College of Veterinary Medicine, advanced the world’s first vaccine for honeybees.

Startup companies created through UGA’s Innovation Gateway had a $531 million national impact.

The unique combination of founders giving back, incubator resources, and momentum with the “sleeping giant” of women and minority startups will help unicorns and honeybees thrive in Georgia.