Research Paper: Differences Between Growth and Startup

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Entrepreneurship: Startup vs. Growth

Startup

In numerous occasions, the term startup has been employed wrongly by being associated to young ventures and huge tech business. In trying to describe it, Osorio (2015) stated that startup could be defined as the process and practice of planning, organizing, operating and also assuming the risks of a business venture. A startup business is an idea, which is taken up and thereafter made real by bringing it into existence. Robehmed (2013) considers a startup to be a company or a business constantly working towards solving an issue or problem where such a solution is not obvious and more so where success is not really assured (Robehmed, 2013).

What is more, numerous initiators and originators would also be against the idea that acquisition contradicts startup status. Even though the terms of acquisitions are different and vary, a startup that is acquired becomes or grows to become part of a greater business and essentially an independent entity (Robehmed, 2013). In essence, for a startup to come about there has to be recognition of an opportunity or prospect and action done in effect of it. The need that is to be fulfilled or satisfied ought to be investigated and a plan has to be developed. Lastly, the resources that are required have to be determined, acquired and managed thereafter (Osorio, 2015).

Growth

The context or structure encompassing the growth of business is centered on the fact that all of these businesses experience and go through similar problems that come about at similar phases in their development. Understanding and gaining knowledge of this conception permits the owner of the business to gain important and valuable insights (Chruchill and Lewis, 1983).

There are five stages of growth, enumerated as existence, survival, success, take-off, and lastly resource maturity. Each aforementioned phase is categorized by a dissimilar incentive to growth and susceptible by a dissimilar challenge. As a business progresses or advances through every stage, it is imperative for the business owner to be cognizant of the appropriate time to relinquish control and when to delegate duties and responsibilities (Chruchill and Lewis, 1983).

The first stage of growth is existence and it encompasses the stage of business gaining consumers. This is the starting phase of the business as it begins to evolve. Any business cannot be said to exist if it does not have consumers to serve or render products or services to. The main aspects taken into consideration here is whether the company can attain sufficient consumers, be able to deliver its products and products efficiently and smoothly in order to become a business that is viable (Chruchill and Lewis, 1983).

It encompasses whether the business is able to expand its production to attain greater sales base. In a number of instances, some business owners are not able to cope with the different demands such as finances and end up quitting. The businesses that are able to cross the first stage successfully are stage two enterprises. The second phase of business growth is survival. To start with, when a business gets to this phase, it has proven that it is a feasible business entity. This implies that the business has adequate consumers and satisfies them appropriately with its products or services in order to sustain them (Chruchill and Lewis, 1983).

The emphasis laid by the business in this phase is the optimization of cash flows. Therefore, the issue changes from simply being existent to the link between revenues and expenses. The business considers whether it can break even and increase its cash flow to grow into a size that is considerably large to generate economic returns in the market. In this phase, the company might grow in terms of size and cost effectiveness and advance… [END OF PREVIEW]

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