In popular culture every new business is often called a "startup". Yet to me, the key feature defining a startup in the "Silicon Valley sense" is a capital structure optimized for:
1. growth of equity value as the primary "payday" for the founders
2. receiving investment in exchange for equity based on a similar "payday" for the investors
3. non-linear growth of equity value.
Technology tends to facilitate this organizational optimization, but it can also facilitate business optimized for the generation of regular cash returns to investors.
In popular culture every new business is often called a "startup". Yet to me, the key feature defining a startup in the "Silicon Valley sense" is a capital structure optimized for:
1. growth of equity value as the primary "payday" for the founders
2. receiving investment in exchange for equity based on a similar "payday" for the investors
3. non-linear growth of equity value.
Technology tends to facilitate this organizational optimization, but it can also facilitate business optimized for the generation of regular cash returns to investors.