The hipster investors who rediscover the toast, agencies established in a garden villa with the ambition to shake up the advertising world, or cafes sharing the name of ‘Honeysuckle’ (Hanımeli) which is opened throughout the country with the gas of “My mother makes very nice bulgur salad”… They are all starting with financial goals but are not Startups. What is the distinctive sign of these Startups?
Although the basic boundaries of the definition are specific, there are many parts that stretch from the sides and make bending. Both the expert and the Startup maker himself are very enthusiastic about enlarging the concept with their own unique provisions. We will try to sum up the topic on a single body with the compilations of with meaning such as “Best of Startup Summer Hits” instead of making a new entry into the cannon by adding new voices to the already existing small scale cacophony. So while we save you from creating search statistics on Google, we’ll help you contribute to our Analytics results.
Although not as much as Jack’s beans, the idea or product that will be the subject of Startup has to have the potential to provide a rapid growth. One of the requirements of attracting investors and potential partners is to promise them a quick amortization. In order to achieve rapid growth, it is necessary to address or reach a big market, and this is why technology/knowledge formations come to mind when we say Startup. The mass that can be reached with an application or with a localizable online service is much broader than the mass to whom a motor-courier can deliver glue-free products. What could make an investor happier than the fact that Uber converted in four years from a Startup to a giant with tens of millions of dollars that could negotiate with governments? A smile? We do not think so.
Jan Koum, the founder of WhatsApp, could still say for the $19 billion company last year that “We are a Startup, man…”, because its definition of Startup is related to the feeling of formation. He thinks that the numbers (like 19 billion) or how old the structure is are not important, it is enough if the mood and approach at the stage of establishment are still available. Quick thinking, quick decision making, avoiding “lame” things such as meetings… While such types of definitions are common among the founders of Startups that have became successful, the points emphasized by the academics and investors are somewhat different.
“Basically, Startup is an organization that is established to research a business model that is repeatable and convenient for growth.”
— Stanford Professor Steve Blank
Blank says that the Startup founder had two elements in his hand at the beginning; the first one is a product vision with full team features. The second is a set of hypotheses related the parts that make up a business model: Who are the users/customers? What’s the distribution channel? How will the product be positioned and priced? Who are the partners? Where and how will we produce the product? How will we finance the company?
When you make a start with so many questions, and when there is no real source of finance, the comments that underline these points are added to the stack of definitions. According to the definition of Eric Ries, a well-known entrepreneur and intellectual; Startups are the human-based organizations designed to develop a product or service under extremely uncertain conditions. A similar definition comes from Neil Blumenthal, a successful Startup founder: “Startup is a company that works on a problem with an obvious solution and has no success guarantee.” Based on these definitions, reaching a solution or product in a successful way and meeting this product/service with the customers in s successful way is perceived as a sign that the Startup mission has to be abandoned slowly.
The question of “What is Startup?” is a question that has multiple answers that can be different but, at the same time, true. The total of the above cites and approaches define Startups as organizations that are convenient for growth (insanely if possible), where creative people work together in a different thinking and mood, focused on developing a solution or product/service for a specific problem or point, include serious risks for the investor as well as promise incredible incomes, and evolve into a company as long as it eliminates uncertainties at the stage of establishment. Although there are many competent persons and correct definitions that adds many more elements such as financial size, organizational structure, number of employees, this generalization may be enough to decide whether you are a Startup or not. If not enough, you can write a definition, too, it will surely be followed by someone.