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What Are The Different Types of Startups?

Types of startups

Many are engaged in creating or even starting their own startups in tech centers like Silicon Valley or any startup hub. Mostly the trendiest term today seems to be a “startup”.

Although the popular definition of a different types of startups as a “tech company with less than one hundred people” is not incorrect, the whole philosophy is not explained.

Remember the days when a great idea was all you had to launch a successful startup. If you had a brilliant idea, it would follow good luck in the form of angel investors and venture funds willing to take you a chance.

Today, only one good idea is simply not enough in this innovation-hungry era. To that end, you need execution, and custom business apps to make a big difference. Not only do they boost operational performance, but apps also make it much easier for startups to keep track of and successfully execute their vision for the company.

The Definition of a Startup

Investors have treated different types of startups as small businesses for several years. It was a real problem as a startup, small firms, and large corporations have a significant conceptual and organizational difference.

The startup is a “temporary organization designed to search for a repeatable and scalable business model” – Startup guru Steve Blank

This concept refers to the following three main functions for the startup founder:

  • To provide a vision for a product with a set of characteristics.
  • Create a series of business model scenarios for the customers, distributions, and finance of the company.
  • Understand, if the model is the right one, based on consumer behavior, as the model predicts.

Different Types of Startups in Entrepreneurship

There are six major types of startups that entrepreneurs tend to jump into. Throw an intuitive business app into the mix, and you’ll significantly multiply the growth potential. Here are the six types of startups that can exponentially benefit from a business app.

1.Lifestyle Startups

Lifestyle entrepreneurs live their favorite lives while working for no one but themselves. In Silicon Valley, these professionals are freelance programmers or web designers who enjoy their jobs because of their passion.

2.Small Business Startups

Small business startups are small companies started by normal people you might meet on the streets. They don’t want to be big, but they want to make a decent living for their family and friends. That said, technology plays an integral role in any sector, no matter how big or small.

If you’re a small company, you probably won’t need a company or consumer app (unless you want to expand). However, you will need a responsive specialized website that has the ability to navigate, order, and track the products/services that the customer may want to purchase. In these cases, a shopping cart with many options for online payments helps greatly boost sales.

3.Scalable Startup: Born to be Big

Google, Uber, Facebook, Twitter are just some of the latest examples of scalable startups. From the very beginning, the founders assume that the future is going to change. More often than not, are always in the tech niche.

That’s because, as the name suggests, they are scalable, i.e. they have the ability to keep rising their revenue while maintaining their incremental costs to a minimum.

Not only do they begin to make a living out of them, but also to see them make a difference in the world and hope that rich investors will realize the potential of their businesses and probably help them to develop.

The concepts with which these startups are formed are usually powerful. This is exactly why Venture Capitalists and investors invest only in different types of startups and never in service startups.

4.Buyable Startups

For those who love earning money, this type of startup is using it then going back to redo business and get some other money again. These startups include businesses such as developing websites and apps.

When their values are appreciated, the owners start the business with little capital, develop them, and then sell them off to say IT firms. Such entrepreneurs go away with several thousand or even millions of dollars, but they hardly get to the mark of the billion dollars.

Their goal is not to create a billion-dollar company, but to sell for $5-$50 M to a bigger company.

5.Large Company Startups

Large companies are of a finite lifetime. Changes in consumer preferences, new technologies, legislation issues, new competitors generate pressure, pushing major corporations to produce new creative products for new consumers in new markets ( e.g. Google and Android).

6.Social Startups

They are passionate about making an impact and drive to that. Unlike scalable startups, though, their mission is to make the world a better place, not for the sake of wealth but for an idea.

The startup is a passion focused on an idea, with a drive. It is going through countless difficulties in finding a way to succeed-even breaking barriers that are impossible to climb. But, really, somewhere and somehow ends this crazy journey.

How is a Startup Founded?

Most likely a startup and a small business start from a pure idea, either with the money of their own founder or friends/family, or a bank loan. A profitable startup would later obtain funding from angel investors, venture capital, or IPOs. An investor earns a share of the company with every investment and becomes the startup’s co-owner.

What are the most common industries for startups?

To summarize, here is a quick breakdown of the most common types of startups based on industry. Although the majority of them are in the technology sector, there are certainly startup opportunities in more “nontraditional” fields as well.

  1. Software (SaaS) and technology
  2. Marketing and advertising
  3. Healthcare
  4. IT
  5. Insurance
  6. Education
  7. Real estate
  8. Environmental and energy
  9. Retail and eCommerce
  10. Blockchain and cryptocurrencies

Types of Technology Startups

Technology has opened up new business frontiers that people living in the 19th century and earlier could only dream of. Consider Facebook, one of the world’s leading big tech companies today. Twitter was founded in 2006, two years after it was founded in 2004. Google, the world’s largest search platform and arguably the driving force behind the internet, was founded in 1998.

These massive tech corporations now rule the world, despite the fact that none of them existed a quarter-century ago. So, if you want to start a business and are technologically inclined, the technology sector is your best bet. There are more than three types of start up firms exist.

Following are some types of technology startups:

1.Ecommerce Startups

E-commerce, also known as internet or electronic commerce, is the buying and selling of both services and goods over the internet. It is one of the simplest types of startups businesses to start today. It also refers to the online exchange of data and funds in order to pay for services and products.

2.Software Startups

Solving people’s problems is what business is all about. You can have a successful startup if you can provide a scalable solution to a problem that people want to solve. Almost everything today is powered by technology, which is heavily reliant on software. This pervasive infrastructure pervades every aspect of life. If you can create software that solves people’s problems, you can take the first step toward joining the league of big tech software development companies.

3.Application Startups

The rise of smartphones and other hand-held devices, such as tablets, has created a new lucrative platform for this technology-driven business. There’s an app for almost any service or product you can think of, from ordering food and rides to online dating and conducting online transactions. If you want to start a technology business, this is one of the most accessible industries. Furthermore, application development is less expensive than software development.

4.Telematic Startups

Telematics is the integration of computer science, vehicular, telecommunications, and transportation technologies. Future logistics companies will congregate here. Telematics improves fuel efficiency, increases road safety, and allows for predictive engine maintenance.

Telematics can be used to reduce fleet costs and transportation time. These are substantial advantages that most customers would find irresistible, making a telematics startup a potentially profitable venture. This platform’s advantage is that it gives users access to real-time, actionable transport data, which is essential when managing a fleet.

5.Cybersecurity Startups

Every business that interacts with the internet requires a security setup. With the frequency of large data breaches increasing by the day, and hackers devising inventive ways to breach firewalls, having a watertight cybersecurity infrastructure is critical today. Customer data security has emerged as a major issue, prompting increased data regulation. A cybersecurity startup that can provide watertight solutions to internet security breaches such as identity theft will find a ready market here.

6.Cloud Computing Startups

Businesses have two options when it comes to software installation: local installation or cloud installation. The software is installed on local computers or servers with local installation. In cloud computing, however, the software is installed on a cloud, which means it can be accessed from anywhere with an internet connection.

People can work on the beach, in their bedrooms, on planes, or on farms using cloud computing; in fact, they can work anywhere there is an internet connection. Investing in a cloud computing company is thus a great business idea. The majority of applications, including Zoom, Skype, and many others, are cloud-based. Starting a cloud computing business will allow you to assist businesses in managing their operations efficiently and remotely using a variety of technological devices.

Bottom Line

There are more different types of startups than Silicon Valley tech companies in the startup world, and there is a startup type for every type of entrepreneur and business idea. Whether you want to start a charitable organization, diversify your current business, or start a small business in your community, launching a startup is an exciting first step toward your entrepreneurial goals.

See Also
Difference Between CEO and COO
How to Select your Business Owner Title
Social Media Marketing Strategy for Startups
How to write an Executive Summary for Business Plan
Different Types of Financial Markets