If you haven’t heard of Brex, it’s the “first corporate card for startups,” with all the convenient features that fast-moving, scrappy companies need. It also looks pretty slick.
Anyway, Brex just came out with an interesting report that looks at what startups are spending their money on. Or as we like to call it, extremely useful competitive research.
And yes, Copper is on it.
But first, let’s look at the industries where startups are burning through cash the fastest.
- Internet Services
- Data and Analytics
In comparison, here are the most budget-conscious startup industries:
- Consumer Electronics
- Operating Systems
Well that’s… surprising—you’d think that consumer electronics and operating systems would have to spend quite a bit on tech, but it makes sense that the internet, cars and trains, and big data are huge money pits.
What wasn’t surprising was San Francisco being the #1 region in the U.S. for highest burn rate, since it also has “the highest concentration of high-growth startups, which correlates with a monthly seed burn rate of $370,000 a month.”
Now, the interesting part.
When it comes to where startups are spending their cash, Brex made a strong statement:
“Tech titans and industry veterans like Paychex and Salesforce are not popular with startups — startups are instead relying on other startups.”
Well, we can’t argue that tools developed by startup companies do tend to have comparatively lower subscription costs, more responsive Customer Success teams, and more modern interfaces—but before you think we’re just tooting our own horn...
Here are the most popular tech tools for startups, as voted by Y-Combinator companies (across a range of pre-seed to series B companies from 2017-2018).
- CRM: 60.9% of startups are using Copper. (That’s us!)
- Rideshare: Uber had a slight edge over Lyft as the rideshare of choice for 58% of survey respondents.
- Customer support: Intercom pretty much blew everyone else out of the water (78%).
- Productivity: The majority (60.5%) of respondents are using G Suite. No surprise there.
- Design project management: This was probably the tightest competition out of all the tool categories, with Toolkit (38.5%), Zeplin (30.8%), and Invision (23.1%) being the top three. (Editor’s note: As a copywriter who’s always worked closely with designers, I’ve used Zeplin and Invision—and really enjoy using both).