Startup vs Business

While the terms are often used interchangeably, there is a fundamental difference between a "business" and a "startup". Understanding this distinction is crucial for setting the right expectations and goals.

Business

A business is any entity that provides a product or service in exchange for revenue. This can include a wide range of activities, from running a local corner store to a freelance service. The primary goal of a traditional business is often to generate a stable income for its owner.

Startup

A startup, on the other hand, is a temporary organization designed to search for a repeatable and scalable business model. According to Eric Ries, a startup is "a human institution designed to deliver a new product or service under conditions of extreme uncertainty."

The key characteristics of a startup are:

• High Impact Potential: Startups aim to create a significant impact on a large market. They are not content with serving a small, local audience.
• Innovation: Startups are built around a new product, service, or business model. This innovation is what gives them the potential for high growth.
• Uncertainty: Startups operate in a highly uncertain environment. There is no guarantee that their product will be successful or that their business model will be viable.

The goal of a startup is not just to generate revenue, but to grow quickly and capture a large market share. This requires a scalable business model and a willingness to embrace risk and uncertainty.

Thinking in terms of building a startup rather than just a business encourages a mindset of ambition, innovation, and growth.