When does a startup stop being one?


When does a startup stop being one? Is it when:

  • It gets funded – no, can’t be because vast majority of them get seed funding.
  • It gets customers – no, that can’t be it either
  • It gets revenues – no, because customers could be paying for the service
  • It becomes profitable – no, because even profitable companies are sometimes called startups.
So it was something that had been bothering me for a while. I have asked others but never got a satisfactory answer. Then couple of weeks back I attended the simulcast of Lean Startup held in San Francisco – beamed to the Microsoft offices in Cambridge. There I heard the definition of a startup from Steve Blank which makes a whole lot of sense – “Startup is a temporary organization designed to search for a scalable and repeatable business model“. That to me gives a very easy criteria to determine when a startup stops being one.
Thoughts? Kindly share your thoughts via comments.
Image: Courtesy of freeclipartnow.com

3 Responses to When does a startup stop being one?

  1. Nitesh says:

    Very simple but efffective definition. Thank you for sharing it !

  2. Raminder says:

    so when the organization achieves its mission (of finding/building some business model) and starts getting good business (read customers, revenues), then it moves out of initial phase called “startup”

  3. Greg Thomas says:

    So simple, yet so true, if you look at most business looking to get off the ground today, they are all trying to find new business models that achieve both these goals, everything else either contributes or comes as a result of it.

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