What is a startup?

There is a lot of talk about startups on the web.   But what exactly is a “startup”?  Different people put different meaning in the word, and sometimes it gets very confusing.  Here is one example I came across recently:

 The reason I get asked this is that I left a perfectly good start up called Preemptive Solutions to come here. When I say “perfectly good” its one that I am a co-founder, is now 10 years old, and was President (which I later became VP as I decided I wanted to live away from the HQ).

Somehow, a 10-year old company didn’t fit my understanding of “startups”.  From a quick definition check at Google I like the one from Oakridge Venture Capital best of all:

 New business venture in its earliest stage of development.

This fits my understanding perfectly.  And with this in mind, I think that most companies grow out (or die out) the “startup” stage in their first year or so.  If the company survives that period, it starts getting some routine in it (procedures, practices, paperwork, traditions, etc).  The culture of the company shapes up.  Most of the “what is good and what is not” issues are ironed out.  Etc.  And then it’s not a startup anymore.

What’s your understanding of startups?  How can you say if a company is a startup or not?

4 thoughts on “What is a startup?”

  1. Hi Leonid,

    after reading the last MIT Technology Review (their Innovation Magazine) I would define a startup as “A new business venture in its earliest stage of development, with at least one founding member having negative capabilities.” According to the magazine having “negative capabilities” is when a man is capable of being in uncertainties, Mysteries, doubts without any irritable reaching after fact & reason.

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