

Characteristics That Make a Startup a Startup - drm237
http://startuporbust.com/2007/07/characteristics-that-make-a-startup-a-startup/
What characteristics do startups have that small businesses lack?
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pg
There's one root difference between startups and other small businesses:
startups are meant to grow very fast.

The other differences all follow from that one. Startups do technology.
They're usually product companies rather than consulting companies. They have
exits (either IPO or sale) and give employees options.

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brlewis
Just to clarify, if smugmug never planned on a sale or IPO, then it was never
a startup? I may have to adjust my own thinking on what startup means.

~~~
pg
It's not so much what they planned. More like if there's no hope of a sale or
IPO, it's not a startup.

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geebee
how would you categorize something like craigslist, or 37signals?

Craigslist clearly didn't intend to be huge at first (it wasn't even sure it
wanted to be a web app), and Craig has made it pretty clear that he doesn't
intend to IPO or sell (though a big chunk was purchased, by EBay, I think).
Aside from that, it does have the profile of many startups - small,
technically oriented, programmer-driven, massive growth.

37signals fits to some extent as well - bootstrapped by consulting, but
product oriented, technically oriented, programmer driven, substantial growth.

Neither companies seem to want a sale or IPO - they're happy to settle into a
role as profitable businesses. At that point, I suppose they are no longer
startups.

While these companies are the exception, the approach they advocate does seem
to be growing. So maybe you call them startups and say that there are many
paths - and the IPO/sale exit is more typical.

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chrisconley
first, what does it mean to finish building a product? \--take a look at this
interview i did that was in the same series of posts as the article in
question: www.startuporbust.com/2007/07/dharmesh-shah/ To me finished, is the
first time you "release to the unexpecting." second, would I describe a
startup as dfranke did? i think he's on the right track but also have trouble
with the idea of an unfinished product; a little too vague. third, is facebook
a startup? i think so, although they are a pretty established company, they
appear to still have a startup mentality.

just my two cents

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dfranke
It would be easier and more accurate simply to define a startup as a company
which intends to derive its profits from a product which it has not yet
finished building.

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nostrademons
What does it mean to "finish" building a product?

FaceBook's product is on the market, and it's profitable. It's obviously not
"finished", as they're adding to it daily. Most people would call FaceBook a
startup.

Microsoft Windows is on the market, and it's profitable. It isn't "finished"
either: just look at Vista. And certain areas of Microsoft - Silverlight, F#,
LINQ - are most definitely not finished, and nobody knows if there's an
eventual market for them. Yet most people would not call Microsoft a startup.

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dfranke
I don't call Facebook a startup. They were once, but they're an established
company now. Once your first product is earning a profit (and I mean your real
product, not Reddit T-shirts), you're out of the startup phase.

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jey
If foo.com causes enough people to buy foo.com t-shirts to feed you and clothe
you, why not consider that "established"? Case in point: the guy who runs
<http://xkcd.com> works on xkcd full time and is entirely supported by the
stuff sold through the xkcd store.

(P.S. xkcd rocks)

