The two terms are often conflated but there is a difference – although there are often overlaps.
A start-up doesn’t have to be a technology or digital business, but generally running a start-up will be high risk with no guarantee of success. The founder of a start-up will usually be following their passion; looking for rapid scale-up and will have a global focus.
Conversely, whilst many small business owners are entrepreneurial, they will typically be looking at longer term profitability and security, and most will not be looking at global growth.
The funding models are also different. Both start-ups and small businesses may get initial funding from family and friends, or even through a bank loan. However, unlike small businesses, start-ups will usually fund their development and growth via angel investors, equity crowd funders, venture capitalists, etc.
Unlike most small businesses, start-ups need an ‘exit’ strategy to attract investors.
Want to know more? Or need practical help to get your new idea to market? Contact INNOVIC on (03) 8060 3504 or http://www.innovic.com.au
