Module 1, Startup company
A startup or start-up is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable business model. Startups typically begin with a founder (solo-founder) or co-founders who have a way of solving a problem.
A startup is launched to evolve an idea with the potential for significant business opportunity and impact. Sometimes the idea is a flash of insight, but more often it begins with extensive development of an idea or solution to a meaningful problem that has an identifiable market.
There are three startup stages: early-stage, venture-funded (growth) stage and late-stage.
Early-stage:
An early-stage startup begins with a potentially scalable idea for a product or service targeting a market that is poised to generate value. An early-stage startup begins with a scalable idea that attracts funding. Investors in the early stage — angel and venture capitalists.
Venture-funded (growth) stag:
The company has successfully secured venture capital (VC) financing to fuel its expansion and scaling efforts. This startup stage begins when you receive your first Series A round.
Late-stage startups
A late-stage startup typically has dependable financing sources and is executing the business plan.
You’re in this stage if you are:
- Completely staffed
- Experiencing significant growth
- Looking for expansion opportunities
- Considering an exit
You can graduate to the next step when:
- You can raise funds based on performance, not just potential
- You can expand your business through organic growth or acquisition
- You’ve prepared your company for an IPO
- You’re an attractive acquisition target
Question:
What is the difference between angel and venture capitalists?
How to find the right angel investors?
Resources:
Startup stages: Discover where you stand
Lean Startup and Design Thinking: Getting the Best Out of Both