Large and highly recognized successful companies started their operations as a startup. But what is a startup? We will explain it below. We will also let you know its characteristics and which have been the companies that started as a startup. Let’s see,
Startup: a new business philosophy
An accurate definition of startup would be: “Emerging Company”. Emerging because despite being young and with few resources, it has the ability to scale opportunities in order to achieve the proposed objective.
Their operations are based on scalability and dynamism, which allows them to carry out the necessary changes until they obtain positive results.
Meaning of the word Startup
Start-up, we can translate it as start-up or start-up and as far as business is concerned, this is what a startup is based on, to launch an idea or project to consolidate its development and growth.
In other words, an organization focused on developing an innovative service or product aimed at a potential customer.
However, we usually relate startup projects to technological innovations or products generated in the digital environment. However, a startup can be formed to develop any type of business project, one with a level of innovation capable of captivating the end user but that for the moment is in its initial phase.
Basic characteristics of a Startup
Some of the basic and most outstanding characteristics of a startup are:
It is in its initial phase
Startups are known for being young in the business world, so their development, sales and hiring processes are just starting or less than 3 years in operation.
The creative component of startups is a key and main part of a startup and also the motivation of the people behind it.
Offers innovative solutions, either in the form of a product or service.
It offers a solution to a specific problem. It is undoubtedly the most important characteristic of a startup, the ability to meet a need in the market. If it does not meet this characteristic it cannot be considered a startup.
Focused on growth
A startup does not intend to stay as a startup, its objective is to grow and reach its goals of becoming a consolidated company. It should be noted that this growth happens very quickly in startups, since their only alternative is to survive or disappear.
In constant search for profitability
As mentioned in the previous characteristic, their only alternative is to survive and to do so they must find a business model that is profitable.
Another interesting characteristic that defines a startup is its ability to pivot and change processes, since its processes are based on experimentation and continuous testing.
Every startup lives in constant uncertainty, since its disappearance or evolution will depend on the actions taken. In fact, a startup only ceases to be a startup when it achieves success.
Startups are generally small businesses composed of less than 10 multidisciplinary people and have an annual turnover of less than 250 thousand dollars.
Another characteristic that also defines a startup is its independence. That is, it is not tied to any other startup or business.
They look for alternative and non-traditional means of financing. For example, investors with the agreement to obtain a percentage of the company or Business Angels.
Startups that have become big successful companies.
When UBER began operations its goal was to improve cab service in San Francisco by connecting passengers and drivers through mobile devices. It was born in 2008 and is now a globally recognized company with a staff of more than 15,000 people.
Also born in 2008 with the objective of improving productivity. Only in this case it focuses on the way we work, an ideal application for entrepreneurs and creative people who want to keep their ideas in order. Although it started as a small platform, today it has more than 100 million registered users.
AIRBNB arose from the need of its creators to pay the rent of the place where they lived and to do so they rented their living room as accommodation for other people. This is how the platform started, connecting tourists with homeowners. It currently has more than 3 million accommodations and is present in more than 60 thousand cities.
The creators of this startup Daniel Ek and Martin Lorentzon wanted to offer people a way to listen to music online no matter where they are. To enjoy the application they only had to receive an invitation and in this way they could listen to music for free. Today their music catalog has more than 30 million songs and is present in 65 countries.
Chinese company dedicated to the development and sale of Smartphone was able to overcome in just two years the Samsung Galaxy S4 and iPhone 5 with one of its models “Xiaomi Mi2S”. It currently ranks third among the best cell phone manufacturers in the world.
10 steps to create your own startup
If you want to keep up with the big guys, we recommend you to follow these 10 steps:
- Look for the opportunity, for this you must be observant and find a gap that the market has not yet managed to solve or at least not in the way you could do it.
- Define well your idea, the objectives you want to achieve, the way in which you will differentiate yourself.
- Define your target customer as clearly as possible. This way you will know who you are targeting.
- Establish the resources you will need to carry out your idea. For example, technological equipment, funds, etc.
- Create an action plan according to your objectives. Make sure the goals are measurable and realistic.
- Design a prototype of the product or service you want to generate.
- Build your personal brand and establish an adequate marketing plan to make yourself known.
- Determine the value you provide to the customer. That is, the utility it offers or the need it covers.
- Measure your progress and make changes when you feel it is necessary.
Don’t give up.
If you follow these steps you will surely be able to push your idea beyond the limits.
This article is also available in Spanish.