Startups and their characteristics

Even though the term "start-up" is increasingly used in an inflationary way, it only refers to a relatively small group of companies clearly defined by characteristics. Founders who want to belong to this "elite circle" must meet the following criteria with their business idea:

• The idea or business is (still) in the early stages of development
• The idea is characterized by a high degree of innovation and is specialized in solving an existing problem
• The company has a strong growth potential

These three features can be used to illustrate very well what makes a "real" startup stand out. It is a still young, not fully developed company that stands out from the crowd with its innovative, often novel and/or forward-looking business idea. The "imperfection" of the company leads to the fact that there is still (very) much air left to the top. Startups aim to grow as much as possible in the shortest possible time. This not only increases the market value in general, but also attracts potential buyers and investors. It is not uncommon for a start-up to be founded only to be sold afterwards (for a lot of money).

Categorization of different types of startups

If you take a closer look at the range of start-ups in Germany, you can quickly see that it is possible to divide the many different companies into categories. Startup types that currently attract the most attention are

•  FinTech start-ups (i.e. companies in the finance and technology sector)
• eCommerce start-ups (i.e. online stores)
• Green Startups (more on this below)
• Food start-ups (for example cooking boxes, delivery services, special meals, etc.)

Startups: A guarantee for success?

The Internet and traditional media are full of success stories of young startup founders who have managed to bring "the next big thing" to the market. Stories like these naturally inspire imitators to try their luck and venture onto the slippery ice of starting a business. At this point, however, it should be expressly pointed out that founding a start-up is no walk in the park - even if it may sometimes look that way from the outside. Especially in the early stages of a company, complications and unexpected hurdles lurk around every corner. Added to this is the inexperience that many founders display.

Of course, the temptation to make money with a brilliant idea and/or a heart project is great - and some people will certainly succeed in individual cases. But glorifying the start-up scene in general is a mistake. The fact is that the vast majority of companies fail in the early stages and the desired rapid growth does not even occur.

One of the biggest pitfalls in the startup phase is that they are not able to grow quickly:

•  Underestimating the effort
•  Lack of demand from customers
• Incorrect calculation (loss of financial resources)
• Disagreements in the team

The world of start-ups is tempting. It promises quick success, professional realization and a huge career leap. Unfortunately this picture does not always correspond to reality. If you want to found a start-up, you have to be prepared for many hurdles. Only the fewest reach their goal in the end. Here it is even more important to be well advised and supported by a company in the first years.