A start-up is a company typically in the early stages of its development. They are founded by entrepreneurs who want to develop a viable product, service or platform for which they believe there is a demand. According to a definition by Eric Ries- it is a human institution designed to deliver a new product or service under conditions of extreme uncertainty. Start-up companies generally begin with high costs but limited revenue, which is why they look for capital from a variety of sources such as venture capitalists.
One feature that most people seem to agree on for the definition of a start-up is a focus on growth. The purpose of a start-up is never-ending growth, it requires innovation and creativity. The process never stops after the establishment of the company. It is a non-stop world and this world has a huge hunger for innovation. If the entrepreneurs have not adopted the innovative approaches, then some other company would have their place.
Some start-ups become big and they become unicorns, which is in reference to a term in the business world that indicates a privately held start-up company valued at over $1 billion. The term was coined in 2013 by venture capitalist Aileen Lee, choosing the mythical animal to represent the statistical rarity of such successful ventures. The largest unicorns included Uber and Airbnb. They have shaken many industries and changed the game as they have broken the rules of many traditional companies. Although the company of Airbnb does not physically own any hotels, it is currently the world’s largest hotel chain. Alongside Uber, who does not own a single taxi, but is still the largest taxi company to this day.
Airbnb is a vacation rental online marketplace company based in San Francisco, California, United States. The company was founded in 2008 by Brian Chesky, Nathan Blecharczyk and Joe Gebbia. It provides a platform for hosts to accommodate guests with short-term lodging and tourism-related activities. It is accessible to consumers on its website or via an app. Through the service, users can arrange lodging, primarily homestays, and tourism experiences or list their properties for rental. Airbnb does not own any of the listed properties; instead, it profits by receiving commission from each booking.
Uber Technologies Inc. is a ridesharing, taxi cab, food delivery, and transportation network company which is based in San Francisco and has operations in over 900 metropolitan areas worldwide. It was founded by Garrett Camp and Travis Kalanick in the year 2009. During its growth, Uber has met aggressive resistance from the taxi industry and government regulators.
In 2014, taxi drivers in London, Berlin, Paris, İstanbul and Madrid performed an extensive protest against Uber. The case was overhead by Europe’s top court in December 2016. Uber lost its licence to function in London where the business had 40,000 recorded drivers in October 2017. On June 26, 2018, a London judge reversed the ban, successfully letting Uber operate under a 15-month licence along with conditions. In October 2019, an Istanbul court had ordered Uber to halt operations in Turkey and blocked access to its applications on charges of unfair competition. But finally, on the 24th of December 2020, the earlier court overturned a ban on access to Uber’s mobile application and website.
A start-up requires patience and resilience. Entrepreneurs often feel stressed. As mentioned above, start-ups face high uncertainty and have high rates of failure. A 2014 article in Fortune estimated that 90 per cent of start-ups ultimately fail, however, this process is very natural for all start-ups. So coping with stress is very critical for the entrepreneur’s well-being.
For a successful start-up, one needs to understand the market, their customers and their competition. That’s the golden rule. You need to look for the need and determine the best product to sell. It is also very important to understand how to choose the right business model for his market and customers. Money does not come just because you have got a great idea, but instead, it is due to the customers are willing to pay for what you have to offer.
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