

Ask HN: What is the difference between a startup and a small business? - Slavo

I asked this question on one of the stackexchange sites. Here's the text of the question itself:<p>I've had a conversation with some friends recently on the differences between a startup and a small business. One of my friends said that a startup in a brand new company, which aims to scale fast and become a large company, while a small business stays small and doesn't plan to scale. Examples for this definition of a startup may be Google, Facebook, Microsoft and Apple in their early days.<p>From what I read online, no one makes this distinction. What do you think - do you make a difference between a startup and a small business?<p>I'm very curious about the different opinions in the hacker news community.
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steventruong
I hate the word startup (in the definition sense) because by sheer definition
of the words, it just means to "start up" or start something. ANY business
technically would fit this description.

The valley (or rather the tech related community anywhere really) however
prefers to attach its own strict definition to startups. Even something like
Facebook with thousands of employee, billions in revenue, been around for
_years_ , and a ton of raised capital, can and still be stupidly labeled as a
startup. Like WTF. Seriously. They are NOT just _starting up_.

I have my own definitions regardless of what the textbook definition actually
is and I don't really care whether or not others (particularly
Angels/VCs/Incubators) agree...

You're a startup if you're less than 2 years old, have less than 20 people, or
haven't made over 2 million gross. If ANY of these (and maybe a few other
factors I'm not naming) is ever not true, including the age of the company,
you're not a startup. I don't care if you're still pivoting, still _trying_ to
grow fast, blah blah blah... or whether its a coffee shop or a scalable tech
company.

If you want to define it as a scalable company or tech company, then by all
means reference it as something like a _scalable tech startup_. Maybe its
because of the words start and up but I hate trying to warp the definition to
something else just because people are in specific industries and want to give
it various definitions to correlate to what they do or what they invest in. I
mean do people feel offended just because a mom and pop coffee shop calls
themselves a startup because technically they are just starting up simply
because people may think it demeanors the word and makes what they're trying
to do sound less cool? I don't really get it.

If I had to venture a wild guess, the term probably came into popular use in
reference to companies that were just starting out and were possibly looking
for venture capital to scale. So sure, there's correlation to how it may
evolved and get labeled as what it is today but that probably isn't a
precursor to defining what the actual word presents.

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xxyz
I think the term startup is in fact somewhat misleading, because in many cases
venture capitalists that want to invest in these organisations want them to
have a full business plan and evidence of customers / market leverage.
Obviously it makes sense for them to ask for these things, but to me it seems
odd to call an organisation with a long term plan and often a number of
employees a 'startup'. Organisations that are truly starting up are in much
earlier stages of development, trying to decide if there is a market for a
particular product and trying to fit this market and generate interest.

But the definition you give of a startup seems to be the current
interpretation that many people would have.

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thaumaturgy
Your friend is pretty close; pg has said before that "scalability" is one of
the defining characteristics of a startup. They don't necessarily have to
become a large company, but, if a startup wants investment, they have to show
some chance of scaling quickly. (At which point they get bought, or raise more
funding, or something.)

HN in general isn't very interested in small businesses. Unfortunately.

