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Startups Types That You Can Invest in

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Startup Types

What comes to your mind when you hear the word startup? To some, Silicon Valley tech giants such as Google and Facebook come to their minds.

The term startup refers to the beginning stage of a company but not a permanent business model. There are millions of startups across the world. Some have successfully dominated their industry while others are slowly growing to revolutionize the business world.

Startups are not necessarily found in the tech sphere but they’re also in cleaning, retail, finance, insurance, healthcare, education and other industries.

So here are the six startup types that you can invest in.

Scalable Startups

Most companies in the tech niche belong to this category because of the huge potential the technology has and the access to the global market.

Investors favor tech businesses because they take a concept and rapidly grows it into a top-end revenue in order to obtain the highest possible return on investment (ROI).

To achieve that the tech startups conduct thorough market research which helps them identify exploitable market opportunities. They also hire top-notch talents and pitch to the topmost venture capitalists and business angels in order to raise funds needed in boosting the development of the ideas and scaling their products and services. Their outsized returns attract press coverage and all the risk capital.

Google, Facebook, Twitter and Uber are examples of scalable startups which begun with an intention of dominating their industry. The brands applied the scalable startup model and today they are leaders in their industry.

Therefore scalable startups are characterized by the availability of an extensive market and vast growth potential. Further, the founders are ready to challenge the status quo and grow to a worldwide presence.

Lifestyle Startups

The startups are founded out of the desire for independence, and passion. In fact, their founders spend a lot of their time and energy on building a business out of their hobby or favorite activity.

A tour guide business that an avid traveler started, a freelance coding business belonging to a web developer, a fashion school that a fashion designer operates or a dancer that runs a dance school to teach kids and adults how to dance are examples of lifestyle startups.

Therefore these lifestyle entrepreneurs make a living by doing what they love. In other words, they satisfy their personal needs by engaging in activities that they entirely like.

So if you have a hobby that you can do all day, each day, passionate and creative as well as disciplined and self-motivated then a lifestyle startup is the perfect fit for you.

Social Startups

Generally, entrepreneurs start a business to make money; however, social startups are not created to generate income for the founders. Instead, they’re created to make a positive social impact or environmental change.

Social entrepreneurs design companies to do good for society and they don’t expect a big payout from this business.

However, unless it’s a nonprofit organization supported by donations, social entrepreneurial startups can make money using this startup model. In fact, they’re starting a path to wealth creation which helps them create a better world.

A social startup is right for entrepreneurs that are not interested in starting a for-profit company and their ide can solve a problem in a disadvantaged community.

Buyable Startups

Sometimes entrepreneurs can launch a business not grow it into a billion-dollar company but sell it to a larger company. Some of these buyable startups are in the software and technology industry such as app development.

Amazon and Uber are known for buying startups, develop them and receive benefits. Another example is Instagram that was acquired by Facebook.

Founders that engage in the flipping of startups are serial entrepreneurs with a business idea that has tremendous growth potential. Their goal is to make money by selling small companies to tech giants.

Small Business Startups

Longevity is the main focus of small businesses but not scalability. For that reason, the founders are ordinary people and the business is self-funded. Actually, the majority are owned and run by the family, hire relatives or local employees.

These businesses bare make profits because their owners just started it to feed the family and create local jobs.

Perfect examples of small business startups are barbershops, hairdressers, grocery stores, retail shops, travel agents, and bakers. These businesses have a good site, cater to a small market segment, grow at their own pace and don’t have an app.

A small business startup is for entrepreneurs that want to create a sustainable, long-lasting business but not to generate profit. It’s for business people who wants to add to their community by hiring locals to operate the business.

Large Company Startups

Companies adapt this business model to survive the changing legislation, customer interest, new technologies, and markets. So businesses are required to adapt to new conditions by designing innovative products to meet modern customers’ needs.

Big business startups are backed by already established companies and aims at diversifying product offerings, reach new audiences, and tap into the ever-changing market.

A large company startup is a perfect opportunity for successful businesses looking to diversify or keep up with changing markets and technologies.

Takeaway

The post has reviewed six startup types for different kinds of business ideas and entrepreneurs. So whether you’re starting a small business in the neighborhood, a charitable organization or diversifying your current company, launching a startup is extremely exciting. It’s the beginning stage of your entrepreneurial journey.

Therefore these startup business ideas can inspire you to create a unique company and irreplaceable products and services.

I'm a passionate full-time blogger. I love writing about startups, how they can access key resources, avoid legal mistakes, respond to questions from angel investors as well as the reality check for startups. Continue reading my articles for more insight.

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