Startup

A new company built to grow fast by finding a repeatable, scalable business model. The defining feature is the search for scale, not the age of the company or whether it uses technology.

Example

A software company that signs its 10th customer the same way it signed its 1st, and can sign the 1,000th the same way, is a startup. A great restaurant that needs a new building for every new customer is not — it is a good small business.

Important

Startup is not a compliment and small business is not an insult. They are different machines with different funding, different risk and different definitions of success.

Related terms

• Small business — A company built to be profitable and sustainable at a size the owner chooses, rather than to grow as fast as possible.
• Scalability — The ability to serve many more customers without costs rising proportionally.
• Product-market fit (PMF) — The point at which you have built something a specific group of people genuinely want, evidenced by their behaviour rather than their compliments.

Lessons that explain it

• What actually is a startup? — A startup is not just a new company, and it is not the same thing as a small business, an agency or freelancing. The difference decides how you fund it, how fast you must grow, and what counts as success. (12 min)

All 176 terms in the Founder glossary