Small business does not mean startup

Every business needs to start somewhere and at some point it will be small. Does this mean that all small business are startups? No!

The phrase startup has become very trendy and is heavily overused. With governments and incubators touting startup support services and growing the number of startups. Everyone seems to think that any early-stage business is a startup, which, in my opinion is very misleading. Most of the time what they’re talking about is a business starting up.

Let me clarify. A startup — in the sexy trendy sense — is a small business with high-growth potential. They’re highly scalable and can be very profitable. Small business that remain small business or grow slowly into medium size businesses are not this.

Venture capitalists, rapid IPOs, overnight success stories only happen when you’re swinging for the fences and aiming for the sky. This is not the trajectory of normal businesses. No matter how you are funded, you must be thinking big to call yourself a startup.

There is nothing wrong with starting a normal small business, wether it’s a lifestyle business or not. But not distinguishing between one that has real potential and one that is just mediocre is a grave mistake.

You have to approach the two totally differently in every way. Your strategies are totally different. And if you don’t distinguish what you’re aiming for well enough, you’re always going to do it badly.

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This article first appeared on Roger Norton’s blog with the same title. It was republished with the author’s permission.