What Can Small Businesses Learn From Start-ups?

Let’s get one thing out of the way: you’re an entrepreneur. Your mind is constantly spinning with ideas to share your passion. You probably already have or at least moving toward stepping away from a traditional day job in pursuit opening your business. You’re about to take that first giant leap toward turning your dreams into a reality.


Dig further into the motivations behind pursuing a business and you’ll find a myriad of reasons. Here lies the rub. Motive is a key difference between small businesses and start-ups. While they share many characteristics, such as a scrappy, pull-yourself-up-by-your-bootstraps work ethic, start-ups and small businesses do have some key distinctions. Entrepreneurs benefit from learning the differences between a small business and a start-up, and they can effectively build their business drawing from the best of both worlds.

Differences Between a Small Business and a Start-Up

At first, it seems like it’s an issue of semantics. For the most part, Small businesses and start-ups are both businesses with a lean staff to rely on. However, let’s look at what each definition means:

Small business

A small business is privately owned and operated. It usually has a small number of employees and expects a limited profit, although the definition of actual numbers—in regards to employees and the number of sales—varies among organizations. The U.S. Small Business Administration, a government agency, has various size standards of what constitutes a small business depending on the industry sector.

Small businesses often have brick-and-mortar locations. Think of the retail boutiques, yoga studios, or restaurants lining your downtown. Those small businesses are selling a service or selling a product to a limited number of customers because they operate within in a fixed physical boundary. While small business often struggle in the first year of operation to make a profit, small business owners always have the intention to make a profit since day one.


When the word “start-up” comes to mind, most people think of tech and Silicon Valley for good reason. It’s where big funding and innovation meet. Silicon Valley is built on a culture of dreaming big and taking risks. Start-ups are companies that do just that: create a product that’s innovative or currently doesn’t exist. The poster child of start-up innovation is the iPhone produced by Apple. Start-ups, for the most part, are largely driven by the belief that their idea will change the world.

It’s not unheard of for entrepreneurs to start their operations out of their garages; this makes start-ups sound like small businesses. However, the difference lies on the scalability. Start-ups intend to develop a business model that can be replicated without boundaries. In other words, their sights are set influencing on the world’s stage.

That’s the difference in eggless mayo, a mayonnaise substitute and premiere product of tech startup Hampton Creek. Its line of innovative food products is making people wonder what is hampton creek and how the company is making sustainable food products available on a mainstream scale.

Entering Startup

photo credit: Mike / Flickr

Top Tips That Small Business Owners Can Learn From Start-Ups

Generally, most entrepreneurs are considered small business owners. However, that doesn’t mean they should ignore advice from tech start-ups. Here are some tips from the start-up world that can help keep your business moving forward:

Prioritize value-based connections

Small business owners often focus on marketing the features of the product or service. This is a challenge for start-ups because, more often than not, the product or service is still being developed. Think of it like building a plane as it flies—it’s constantly changing while also navigating new territory. However, a start-up keeps moving forward because it strongly believes in the value of why it exists—and it’s driven by the motivation to connect with customers who share that value.

Experiment by offering unique products or services

Even though small business owners are taking a leap by starting their own business, they tend to still be afraid to experiment or “fail fast,” a popular mantra for tech start-ups, because failures can be expensive and risky. Combat this by implementing your unique product or service on a small scale. That small step out of your small business comfort zone and is one step closer to eventually going big.

Continue to build the business

Start-ups from the get-go have their sights on the world stage, and this perspective can also help small business owners. Companies must grow; otherwise, they won’t last.

These tips from start-ups can help small business owners make their dreams into a flourishing reality.


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