How we chose the companies

It’s a strange time to be a private startup backed by a venture.

The exits are blocked. The last Disruptor 50 company to go public was Gojek, which debuted on Stock Indonesia over a year ago. 50 Disruptor’s last initial public offering in the US market, nubankoccurred on December 9, 2021.

Venture Capital Funding Sluggish Venture capital activity declined across all stages and sectors in the first quarter of 2023, according to PitchBook’s Venture Monitor. And valuations have collapsed — PitchBook says the average pre-money valuation in the first quarter of 2023 is less than half of what it was in the first quarter of 2022.

Silicon Valley Bank, once the beating heart of the venture capital community, doesn’t beat anymore.

The kind of phrases that were rare in the environment of the last decade “grow at any cost”, “move fast and break things” are now common themes. Disruptor 50 now tells us it is “working to be more agile,” “narrow the focus,” and “prioritize profitability over growth” as it manages inflation and the potential for recession along with a tightening venture capital environment.

On the other hand, we may be on the cusp of a truly new era – the age of artificial intelligence. Disruptor #1 this year has gone, in just six months, from being a laboratory in Silicon Valley to – depending on who you talk to – sparking a revolution that will change every aspect of human life, or lead to the demise of all of humanity. Astonishingly fast.

Innovation never stops. Indeed, we have found that crises are often fertile grounds for disruptive innovation, as consumers and organizations look for ways to leverage technology to be more efficient, or to solve new problems. The 2023 disruptors identify these new market opportunities and offer solutions across many sectors.

Here’s how we picked them:

All private and independently owned startups established after January 1, 2008 were eligible to be nominated for the Disruptor 50 list. Shortlisted companies are required to submit a detailed analysis, including key quantitative and qualitative information.

Quantitative metrics included data provided by the company on workforce size and diversity, scalability, sales, and user growth. Some of this non-memorable information has been retained and used for registration purposes only. CNBC also brought in data from a pair of third-party partners – PitchBook, which provided data on fundraising, implied ratings and investor quality; AndIBISWorldwhose database of industry reports we use to compare companies based on the industries they’re trying to disrupt.

CNBC’s Disruptor 50 advisory board – a group of 51 leading innovation and entrepreneurial thinkers from around the world (see member list below) – then ranks the quantitative criteria on importance and potential to disrupt existing industries and public companies. This year the board again found that scalability and user growth were the top criteria, followed by sales growth and the use of advanced technologies (including, more commonly, artificial intelligence and machine learning). These categories received the highest weighting, but the ranking model is designed to ensure companies score high on a wide range of criteria to make the final list.

The companies were also asked to provide important qualitative information, including descriptions of their core business model, ideal customers, and recent company milestones. A team of CNBC’s editorial staff, including television anchors, reporters, producers, and CNBC.com writers and editors, along with several advisory board members, read the submissions and provided comprehensive qualitative assessments of each company.

The qualitative score and the weighted quantitative score were combined to determine which 50 companies submitted the list and in what order.

It’s our 11th year, but we’re still seeing a number of “firsts” on this year’s list. OpenAI is the first company to reach number one in its first year of making the list. The company embodies what it means to scale rapidly, going from releasing a product to having 100 million users in two months. The 2023 list also includes the first founder with two companies making the Disruptor 50 (SoLo Funds’ Rodney Williams).

And this year’s list brings the first appearance for a company founded in 2020. As the hyper-rapid shift to remote work during the Covid lockdown opened up the need for faster, better, and cheaper cyber protection, No. 5 Disruptor Wiz was there to cater to the new market (of course, it was For the current incumbents, but the point remains). Wiz raised $300 million in new venture capital in February. Imagine what that number might have been a year or two ago…

Special thanks to the 2023 CNBC Disruptor 50 Advisory Board, who once again gave us their time and insights. As always, we appreciate their contributions:

• Rob Adams, Managing Partner, Texas Funds, Alumni Ventures
• Ron Adner is a professor at Dartmouth Talk Business School
• Ed Blair is Professor of Entrepreneurship at the University of Houston
• Robert Brunner, Senior Disruption Officer, Jess School of Business, University of Illinois
• Howard W. Buffett, Professor, Columbia University
• John Sibley Butler, Chair in Constructive Capitalism (Emeritus), University of Texas
• Gary Chan is a professor at the Hong Kong University of Science and Technology
• Paul Cheek, Senior Lecturer, MIT Sloan School of Management and Executive Director, MIT’s Martin Trust Center for Entrepreneurship
• Jim Chung, Associate Vice President for Research, Innovation, and Entrepreneurship, George Washington University
• Benjamin M. Cole, Endowed Chair in Entrepreneurship, Fordham University Gabelli School of Business
• Chris Coleridge is Associate Professor of Management Practice at the University of Cambridge
• Monica Dean, Managing Director, Grief Center for Entrepreneurship Studies at the University of Southern California
• Judy Ailes, director of the Pappajohn Center for Entrepreneurship at Iowa State University
• Hayes Ferrogson, associate professor and director, Northwestern University’s Farley Center
• Claire Gately, Professor of Entrepreneurship and Innovation, South East Technological University (Ireland) and EDHEC Business School, France
• Michael Goldberg, Executive Director, Vail Entrepreneurship Institute at Case Western Reserve University
• Michael Goldsby is Distinguished Professor of Entrepreneurship at Ball State University
• Henrich Greif is Professor at INSEAD
• Anil K. Gupta, Chair and Professor of Strategy and Entrepreneurship, University of Maryland
• Mike Heaney, Vice President, Syracuse University
• Lisa Henneberger, Associate Professor, Esade School of Business
• Michael Hendron, Academic Director, BYU Rollins Center for Entrepreneurship and Technology
• Keith Himeleski is Professor of Entrepreneurship at Texas Christian University
• Yael F. Hochberg is Professor of Entrepreneurship at Rice University
• Lonell Johnson, Entrepreneurship Specialist, Bowie State University
• Neil Kane, Assistant Professor and Director of ESTEEM Curriculum and Graduate Counseling, University of Notre Dame
• Koratko, Distinguished Chair and Professor of Entrepreneurship, Indiana University Bloomington
• Rob Lalca, Professor of Business Administration, Tulane University
• Debra Lamm, Executive Director, Georgia Tech Partnership for Inclusive Innovation
• Marie-Josée Lamothe, Professor and Director, Dobson Center at McGill University
• Vincent C. Lewis, Associate Vice President, Entrepreneurial Initiatives, University of Dayton
• II Luscri, Assistant Vice Chancellor and General Director, Skandalaris Center at the University of Washington
• Alex McKelvey, interim dean, Syracuse University’s Whitman School of Management
• Michael W. Meyer is Professor of Design at the University of California, San Diego Raddy School of Management
• Scott Neupert, Chair of Entrepreneurship and Academic Director, Field Programs in Entrepreneurship, Baruch College
• Dan Olszowski, University of Wisconsin-Madison Weinert Center for Entrepreneurship
• Banu Ozkazanc-Pan, Professor, Brown University
• Gerhard Blaschka, Professor, Kellstadt Graduate School of Business, DePaul University
• Julia Prats, Academic Director, IESE Business School
• Jeff Reid, professor of practice and founder of Georgetown University’s Entrepreneurship Initiative
• Zachary Russell, Chair and Associate Professor of Management and Entrepreneurship, Xavier University
• Matthew W. Rutherford, Professor and Chair, Oklahoma State University
• Mark T. Schenkel, Professor of Entrepreneurship and Department Chair, Belmont University
• Albert Segars is Distinguished Professor, University of North Carolina Chapel Hill
• John H. Shannon, Professor, Seton Hall University
• Louis Sheets, director of the Chevitz Center for Entrepreneurship at Saint Louis University
• Daniel Stewart, Professor of Entrepreneurship and Director of the Hogan Entrepreneurship Program at Gonzaga University
• Thales Teixeira, founder of Decoupling.co and professor at the University of California
• Dr. Susan L. Tunney, Associate Professor and Department Chair, Hampton University Center for Entrepreneurship, Economics, Finance, and Accounting
• Mary Ann Williams, Chair of Innovation, University of New South Wales
• David Zwelichowski, Senior Faculty and MBA Track Chair in Entrepreneurship and Innovation, Tel Aviv University and Professor of Global Standard Courses, The Wharton School of the University of Pennsylvania