The spotlight only shines on "Startup X raises millions in new round".
Side projects are the new Lean startup.
From the article: "Still, unless your startup has access to large pools of capital or have a brand name like Katzenberg, Lean still makes sense."
Side projects, solo entrepreneurship are not mutually exclusive and can actually be complementary. Lean is a methodology to validate demand for a product. Solo entrepreneurs can and do benefit greatly from employing it.
When actually, most probaly are not. But this is almost impossible to measure as who can survey everyone with a side project.
Solo entrepreneurs, side-projects, 'lifestyle businesses', ISVs, and other small businesses in tech don't really fit into that category. Although while many of them still call themselves startups (which is fine) the distinction is quite clear.
Lean Startups has fundamental business advice that is good for any company. But Steve's analysis here is clearly targeted as a specific group of traditional high-growth startups which angels/VCs invest in, from which the original idea for Lean was spawned and designed for (and later found wider applications outside of startups - for better or worse).
Startups are specifically organizations that are trying to grow very big, or that are looking to try a new business model. The reason the spotlight shines on them is because starting something new is interesting (from a "news" perspective, at least). Getting big is interesting. Starting a new restaurant - not really interesting, except for people who live in that area.
But fair enough, exclude the coffee shops, restaurants if you like.
But you're still left with a lot of people building something they hope gets bigger. That fits your definition.
Like you said, this is just arguing semantics. That's why I like Steve Blank's definition, which is not about growth (see my other comment on this thread for more).
I would say that "hoping it gets bigger" is not enough - every business owner hopes their business gets bigger. Most of them don't realistically hope it will become the next Amazon, nor do they strive to make that happen, and so many ideas/lessons from the startup world don't really apply to them (while others do still apply, of course).
I'm interested, which wouldn't apply? I mean just a couple of examples.
Other things are more domain-specific - I know lots of lessons in my own field (professional services), some of which apply equally to startups, some of which don't at all.
I think you have been tricked by YC and other VCs to accept this definition of 'built from the start for hyper-growth'. That's how they get their share of young promising companies.
To me and most people I know, a startup is a project or company in the growth phase.
Yes, for most people I know, a "startup" is just new word for a new company, or even new pizzeria or barbershop. For entrepreneur I know, startup is "built from the start for hyper-growth", as he explained it for me.
I don't think that's true? Which unicorns are not companies that were pursuing high-growth, or that were trying to build a unique product<>business model?
> I think you have been tricked by YC and other VCs to accept this definition of 'built from the start for hyper-growth'.
I haven't been tricked into anything. We are commenting on an article written by Steve Blank, one of the "founders" of the lean startup movement. His definition of a startup is "a startup is an organization formed to search for a repeatable and scalable business model." [1]
Of course this is all just semantics, so feel free to use the word in a different way. Where I disagree with you is this:
> To me and most people I know, a startup is a project or company in the growth phase.
I simply don't think that's true. I think most people would not consider e.g. a new law office to be a startup, definitely not in the context of talking about things like the "lean startup" movement.
That's why I love Steve Blank's definition - I think it does what every good definition does - it gives more understanding. It helps give a simple answer to "when does a company stop being a 'startup' and become a regular company". The answer is - when it has found a scalable business model, and is now executing on that.
For the record, I'm a big fan of bootstrapping, I ran a successful bootstrapped development agency in the past (which was acquired), and am now back to running a (bootstrapped) consultancy. I just don't think that people would include my company when thinking of startups - and that's fine! Entrepreneurship takes many forms.
[1] https://steveblank.com/2010/01/25/whats-a-startup-first-prin...
English being what it is, it is fine for "lean startup" to have a different definition of startup from the word "startup", confusing as that may be.
Apple? HP? Pretty much every Silicon Valley company that started with one or two guys in in a garage?
The definitions of "startup" and "unicorn" seem to be forever evolving. But at one time, both Apple and HP would qualify.
I mean, Steve Blank's definition as semi-quoted by me included "or were trying to build a unique product <> business model". I think it's safe to say that Apple was trying to build a unique product <> business model, as was HP.
In any case, a new law firm is a new company. So were Apple and Facebook. I think it makes sense to differentiate between them, and Steve Blank's definition seems to be the best to me (it focuses on what actually makes all the difference - the amount of foreknowledge you have on the market fit of your product).
> The definitions of "startup" and "unicorn" seem to be forever evolving.
Unicorn is actually a pretty well-defined term in this context. And it's really new, too, something like 5-8 years old if I remember correctly. A private company with a valuation of more than 1 billion dollars..
You seem to be saying that there are a lot of businesses, which will never be startups.
While that's true, they seem to be saying that being a startup is not an immutable trait of a company, but rather a phase, and that any side project or solo business could enter the startup phase at any time.
Sure, most people wouldn't consider a law office to be a startup. Most people also wouldn't consider a consultancy like 37Signals a startup. Most people wouldn't consider a novel URL-ranking algorithm like Google's a startup, or any number of other projects or businesses that didn't begin as startups.
That's not to say that a restaurant is likely to turn into a bootstrapped startup or anything. I think their main point was that not all startups started out with intentions of high growth. Your initial response was that "Solo entrepreneurs are not starting a startup, not as I (and most people) understand the term." To that, I think what they are saying is, "they could be."
You could then argue that startups which aren't yet startups are outside the scope of the OP's original statement that, "For every Startup raising $X million in funding there are probably a thousand solo entrepreneurs bootstrapping their way into profitability." Because, when they do become a startup, then they'll be raising money just like everyone else.
However, even that rebuttal would ignore all the startups that became startups aimed at high growth driven by profitability instead of raising millions at the outset. [1]
Honestly, I think the reason funded startups get more media coverage than bootstrapped startups comes down to simple numbers. There is a large but finite amount of demand for news on successful startups. There aren't enough successful acquisitions, IPOs, or openly successful companies to fill the demand, so we have to dip into indicators of future success, such as funding, to satisfy the demand for news on interesting new businesses. However, as many startups as there are getting funding, there are even more side projects and small businesses being started. Most aren't successful yet, and if they are, they're too busy being successful to proactively reach out to the media with an interesting story.
In other words, I think funding rounds are just an easy source/filter for journalists to publish on, and which require little effort editorializing to be considered interesting by the masses.
[1] https://techcrunch.com/2017/07/01/invisible-unicorns-35-big-...
I mostly agree with you, but I don't really agree with this idea. I mean, theoretically, yes, it's true - but I still think it makes sense to differentiate between a new restaurant, and someone trying to create a new technology product/company with billion dollar potential.
And this is what investors are looking for, too, which is why only this kind of startup gets VC money.
“Big” money is relative to the costs of getting the business started.
http://www.paulgraham.com/growth.html
> A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit." The only essential thing is growth. Everything else we associate with startups follows from growth.
Aside from stating what PG means when he uses the term (which is important!), that part of the essay has no real weight.
Solo entrepreneurs absolutely start things besides coffee shops, restaurants, garages, etc. There is nothing inherent in the definition of "startup" that precludes solo founders. Especially when you think in terms of "you're solo until you aren't". Just like "you're bootstrapped, until you aren't".
Taking on co-founders, raising external capital, etc., are all things you do when you get to the point that they are necessary.
I may have given the mistaken impression that I was bumping on the solo founders bit, but that has nothing to do with it - I just reused the phrase.
I agree that somebody making another burger joint or corner store is an entrepreneur, but is not doing a startup. But that doesn't mean that solo entrepreneurs can't do something new. It doesn't have to be big, just exploratory.