Everything starts with a basis, with an idea. And as such, businesses are no different. But as your business grows, there comes a time when you need to identify under which category of business does yours fall under.
To determine which business model fits yours the best comes after you determine what the idea is and how it will be executed. This will help you understand whether your business is a ‘start-up’ or a ‘small business.’
What is the difference between start-ups and small businesses?
The primary difference between the two lies in your objectives of starting your business. Are you pursuing towards starting a stable business that ramps up profits every year or are you pursuing towards introducing a new game changing product or service that will change the way people generally perform activities?
Start-ups are generally the ones which use grants and shareholder investments to manufacture a product or provide a service which projections show has the potential to take the industry by storm. It’s a risky game to take on but you know that if carried out successfully, the end fruit will be great.
Small businesses on the other hand, are a bit conservative in their approach. They seek to implement a business strategy or plan which will bring forth steady growth and help to generate a pre-existing profit goal.
Both start-ups and small businesses are filled with their own risks and obstacles, start-ups go for the route of big gamble and big rewards whereas, small businesses go for a steady growth.
Different types of start-ups
The different types of start-ups are highlighted below:
1) Lifestyle start-ups
(The objective is to provide to the owners a great quality of life)
2) Small Business start-ups
(Essentially small businesses but are considered to be start-ups as they thread on new industry grounds)
3) Scalable start-ups
(These are companies that like to think big and implement resources to bring forth change, like Google)
4) Buyable start-ups
(These are companies that are founded with the clear intention of being bought by someone else)
5) Large company start-ups
(Offers products on the basis of their core products)
6) Social start-ups
(These are generally companies with the objective of working for social change rather than generating large profits)
Different types of small businesses
The different types of small businesses are as follows:
1) Micro business
(Usually employs one or two employees)
2) Small scale business
(Employs very small number of employees)
3) Small to medium business
(Has less than 250 employees)
4) Large enterprise
(Has at least 5000 employees)
What are your thoughts on this? Comment down below!