How do you define a "startup"?
Which companies should be listed on Startup Genome and which should be excluded?
In other words, which companies should be listed on Startup Genome and which should be excluded?
Steve Blank's perspective is "you're no longer a startup when you've finished discovering your business model and you're focused on execution."
The dilemma with Steve's common-sense definition is that it's not measurable. :(
So we asked our curators how they define a startup. Here's what we heard:
- A startup must have fewer than n employees.
- A startup must be less than n years old.
- A company should only be considered a "startup" if it has generated revenue or raised investment dollars.
- A startup is a company that cannot sustain itself yet - it's either bootstrapping or dependent on outside capital to survive.
- A startup is no longer a "startup" when it becomes profitable.
- A startup stops being a "startup" when it has an "exit" event - a merger, acquisition or IPO.
All of the above seem like reasonable answers. But where should we draw the line? (is it 50 employees or 100? 2 years old or 3?) And how do we gather the data on when a company becomes profitable? If a company launches and becomes profitable just weeks later, are they no longer a startup?
How do you define a startup?
Personally, I've always been interested in geographically-agnostic companies with the potential to scale quickly.
Geographically agnostic means that the company will likely grow outside of its hometown. If all of a company's customers reside within driving distance, it's not a startup. There must be a potential to expand to new geographic regions. By this definition, the local restaurant down the street that just opened a second location is not a startup.
Scale quickly means that the company can be considered "high growth." If user-adoption and/or revenue does not have the potential to grow quickly, it's not a startup. By this definition, a blog is not a startup.
Before we announce our official definition of a startup - and thus, what can and cannot be included on Startup Genome - we'd love to get your thoughts.
Please share your thoughts in the comments below or join the conversation on Quora.
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