How many start-ups in the US get seed/VC funding per year?

In very general terms, roughly 1,500 startups get funded by venture capitalists in the US, and 50,000 by angel investors. VCs look at around 400 companies for every one in which they invest; angels look at 40.

There are several million “startups” that are formed each year, so one way of looking at it is that there are several million “great people with a good idea who give up because they just cannot get initial funding”.

On the other hand, those VCs and angel investors spend all their time proactively seeking the best companies they can find, and despite their concerted efforts at picking the best of the best, fully half of the ones they do fund will go out of business with a couple of years. Looked at that way, of the 50,000-60,000 deals that get funded each year 30,000 of them should not have been funded (let alone the other few million who wanted funding)… therefore there are no really great people with really great ideas who go unfunded.

Of course, the reality lies somewhere between those two extremes, but my personal guess, as someone who is familiar with the issue from both sides of the table, is that “lack of available funding for truly deserving deals” is not one of the biggest challenges facing entrepreneurship in the US.

*original post can be found on Quora @ : http://www.quora.com/David-S-Rose/answers *