How we chose the 2018 CNBC Disruptor 50 innovators

  • A record number of companies, nearly 1,000, were nominated for the 2018 CNBC Disruptor 50.
  • The 50 start-ups selected have raised a combined $78 billion in venture capital at an implied valuation of $350 billion.
  • They represent attacks on the status quo in many industries, from finance and fitness to energy and consumer products.
George Kavallines | CNBC

The race to grab market share from today's public giants and attain the coveted title "CNBC Disruptor" has never been more competitive. A record 981 companies were nominated for this year's list across every sector of the economy — from social networking to senior living, mining to machine learning. The companies that made the final cut share a common goal of developing revolutionary new technology into lucrative business models to create the next generation of great public companies.

This year's Disruptor 50 companies have the potential to upend multibillion-dollar industries. Combined, they have raised $78 billion in venture capital at an implied valuation of more than $350 billion, according to PitchBook. Thirty-three of this year's Disruptor 50 companies have valuations of $1 billion or more — the unicorns. For some an eye-popping valuation is reason enough to put a company on a list of top start-ups. But our approach to selecting the Disruptor 50 focuses on the ideas and the execution behind the big numbers, not just the numbers themselves.

Here's how we picked the 2018 CNBC Disruptor 50.

Companies nominated were required to submit a detailed analysis, including key quantitative and qualitative information.

Quantitative metrics included off-the-record information on sales and user growth, and data from a pair of outside data partners. PitchBook provided data on fundraising and implied valuations, and we used IBISWorld's database of industry reports to compare the companies based on the industries they are attempting to disrupt.

CNBC's Disruptor 50 Advisory Council — a group of 52 leading thinkers in the field of innovation and entrepreneurship — then ranked the quantitative criteria by importance and ability to disrupt established industries and public companies. This year the council found that scalability and user growth were the most important criteria. These categories received the highest weighting, but the ranking model is designed to ensure that companies must score highly on a wide range of criteria to make the final list.

Companies were also asked to submit important qualitative information, including descriptions of recent company developments and a list of the key technologies driving their businesses. A team of CNBC editorial staff, along with members of the advisory council, read the submissions and assigned a holistic qualitative score to each company. This score was combined with a composite quantitative score to determine each company's overall ranking.

Five companies (Airbnb, Pinterest, Palantir, SpaceX and Uber) have made the list all six years. Each year, we try to discover what the companies that make the list have done that is new, and these five continue to deliver on the promise of what it means to be a Disruptor.

And there are newcomers as well, disrupting industries from fitness to finance to feminine hygiene. These are the companies that think differently — and force the incumbent giants to do the same.

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