Startup vs Small Business. What’s the difference? - Startups 101

Startup vs Small Business. What’s the difference? - Startups 101

(00:00:00) Introduction to Startups vs. Small Businesses

  • Not all businesses are designed to become multi-billion dollar enterprises like Airbnb or Slack.
  • Most businesses will not be the next Amazon, Facebook, or Twitter, nor will they raise significant venture capital.
  • There's a distinction between Silicon Valley-type startups (possibly becoming unicorns) and more modest small businesses.
  • Many small businesses incorrectly try to emulate the VC-funded growth model.
  • The term 'startup' can apply to both groups, but for clarity, the video differentiates them as distinct categories.

(00:00:00) Slidebean's Experience

  • Slidebean began with ambitions to disrupt the presentation software market and to challenge PowerPoint.
  • Despite not becoming the market leader they hoped to be, Slidebean considers its multi-million-dollar revenue a success.
  • The experience suggests that founders should be realistic about their company's category and growth trajectory.

(00:00:00) Characteristics that Define Business Types

  • Service-based businesses with human employees likely won't scale as fast as tech startups and fit more into the small business category.
  • Businesses with software that can be used by millions without proportionally increasing staff might lean towards the startup category.
  • Understanding the potential market size is crucial to align with the type of business you're building.

(00:00:00) Fundraising and Investors

  • Startup investors expect a 10x return and generally prefer exits via a business sale or IPO to recoup their investment quickly.
  • Knowing your business category is critical to avoid wasting time with the wrong type of investors.
  • Friends and family funding may be suitable for businesses that don't fit the high-growth startup model.

(00:00:00) Co-founders and Business Growth

  • Having an executive co-founder with capital and a network may suit service companies better than pursuing startup investors.
  • It's possible to raise modest funds from personal connections for smaller ventures.
  • Mismatched growth expectations can lead to dissatisfaction among investors and pressure on the business.

(00:00:00) Conclusion and Final Thoughts

  • Choose a business path you love, as it will consume a significant part of your life.
  • The reputation and identity you build with your business may stay with you indefinitely.
  • Slidebean offers a free product trial and availability of founder office hours for subscribers.

(00:00:00) Promotions

  • First 25 sign-ups receive a free 3-month period on the Slidebean platform.
  • Existing subscribers can access free office hours with the team.

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