A startup is a newly established company in its early stages, characterized by its focus on innovation, scalability, and rapid growth. Startups typically develop an innovative product, service, or technology to address a specific market need or problem, often disrupting existing markets. Unlike traditional small businesses that prioritize steady revenue, startups aim for rapid expansion and significant market share, potentially on a global scale.
Startups often operate with limited resources and prioritize efficiency and cost-effectiveness. External funding, such as from angel investors or venture capital, is frequently crucial, as startups may not have an established financial track record or customer base. In 2024, global venture funding for startups reached approximately $314 billion, with AI-related companies receiving a significant boost, accounting for nearly a third of all funding. However, the startup landscape is also marked by high failure rates; around 90% of startups fail. Common reasons for failure include running out of cash, not meeting a market need, and being outcompeted.
