What is a start-up business?
The true definition of start-up is disputed by many with some claiming it’s a state of mind, and others believe to qualify as a start-up, you must offer something unique and meet the needs of the people.
In layman’s terms, the Merriam-Webster dictionary defines a start-up as ‘the act or an instance of setting in operation or motion’. It is the process of turning your business idea into a reality.
Tips for success
Whether or not your start-up comes to fruition is dependent upon two things.
The first is you. You must have a strong work ethic and resilience; you’re battling against thousands of other start-ups for funding and market-leading expert backing. Have belief and confidence that your business will succeed, and this will resonate with those you’re pitching to. Remember, they’re buying into you as a person as well as your business idea.
The second is the idea. When thinking of a new business idea, undertake extensive research, analyse to see if there are any gaps in the market where a consumer’s needs aren’t being met. Also look to see if there any prospective competitors already offering a solution. If you find a gap with no competition, it can make the process a lot smoother overall. But, if there is, it doesn’t mean that you must leave your business idea dead in the water, but rather find the USP – unique selling point – and lead with that. Tell others why yours is superior and how it’s different to what’s already available.
Forbes compiled a list of 25 top tips for a start-up success. Some of the most notable being:
- Solve a real problem and meet real needs with your product
- Choose your team wisely
- Have a roadmap
- Form relationships and network
- Be patient and enjoy the process
Is there any difference between a start-up business and SMEs?
Without expertise, a start-up and SME – small and medium sized enterprises – can look very similar, both are built from the ground by an entrepreneur to fill a gap in the market. But they are in fact very different. The main discrepancy is that a small business is not a new idea and often works within a local region e.g., a florist or bakery. They work on a slow and sustainable growth pattern and rely more on predictability and building a trusted, loyal consumer base i.e., locals to the area. An SME is likely to continue for years and will be passed down through family generations as a legacy.
A start-up is much more explosive in its approach and aim to have huge impact in the market. They’re founded upon creating something new, exciting and promise to become the solution to your lifelong problem. In start-ups, the race is on to scale quickly to outpace potential competitors.
Who and what you surround yourself with when creating your startup is very important. The reason being your idea is unique, and should there be a team conflict, one party may attempt to steal the idea and market it before you do. It is therefore very important to ensure you take all the legal action required.
Always, always, protect your intellectual property. Intellectual property protection encompasses the subjects of trademark, copyright, patents, and trade secrets. Formulating a plan from the outset, before intellectual property is utilised, is critical.
As an entrepreneurial start-up ourselves we, Motion Paradox, understand first-hand the importance of a clear and structured operational and legal strategy. Our intellectual property protection will stop you from falling prey to your own success. We offer a range of bespoke solutions at any stage in your growth and development to negate the effects of a motion paradox – a certain critical juncture is reached where growth becomes static, scaling untenable and capital fundraising difficult, because, without structure and governance, an already successful company cannot easily and effectively continue to move forward and transform.
When is a start-up no longer a start-up?
There is no expiry date on the title start-up, but it is not a title entrepreneurs want to retain for too long; remaining a start-up is a sign of an unsuccessful business. Once the start-up has found a proven successful business model, and has sourced the correct products, it is no longer considered a start-up, but rather a company.
Examples of once startups, now world renowned, successful companies
- Lyft – founded in 2012 as an alternative to Uber, it is worth £1.8 billion ($2.5 billion US dollars)
- Snapchat – founded in 2011 as a picture messaging app, it is worth £11.5 billion ($16 billion US dollars)
- Honest Beauty – founded in 2011 offering eco-friendly baby products, it is worth £1.2 billion ($1.7 billion US dollars)