What is a Startup?

From the perspective of a company like Google or from a venture capitalist’s point of view, a startup is a company that was formed within the last 4 or 5 years and has grown to 20 – and sometimes as many as 50 employees. I guess that is understandable, since a true startup wouldn’t register on their radar.

In British Columbia where we all hang out, BC Stats publishes a study called ‘Small Business Profile‘. Every year the studies show that only around 5% of companies have more than 20 employees. In fact companies with 50 or more employees are considered large companies (in BC at least) – which might seem to turn conventional wisdom on it’s head.

So while a VC may think of a 6 year old company with 25 employees as a startup, the rest of us know better. A startup is really a company at the seed or idea stage with a couple of founders and 3 or 4 employees at most. The difference between a seed stage company and one at an idea stage, is as striking as the difference between a toddler and an infant.

Smal Business Profiles 2013

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