Are Software Start-Ups Different? An empirical study on performance of Finnish software companies

Entrepreneurship and start-ups have become modern hype terms. Especially, software start-ups have gathered a lot of interest due to a few successful examples, and the potential scalability of new business. A plethora of accelerators, events and communities has been found as well as new research agendas announced to boost and study the new phenomenon. The question, are software start-ups different, still remains unanswered. This study address whether software start-ups differ from the other kinds of new companies. We use the set of over 20,000 Finnish companies founded during 2010-2013 as an empirical material for our inquiry. To compare the financial performance of software start-ups and the rest, we use the current ratio, profit margin, revenue and return on assets as measures of financial performance. The results show that, indeed, software start-ups differ from the control group in the used financial indicators.