Contrary to what some people might tell you, there is no “right” direction to take your business. Both startups and small businesses will have their advantages and disadvantages depending on what your business goals are.
First of all, you need to decide what your business objectives are. Growth and expansion are major goals for a startup, while small businesses tend to focus more on long-term stability and productivity.
Startups require taking risks. For example, startups almost always depend on funds. Even if you have savings or another established business, you’ll will inevitably be required to frequently pitch venture capitalists (and you probably won’t even get to this level without some initial seed investment and a planned trajectory). Small businesses, on the other hand, can survive (and begin) without having to raise funds from a VC firm, and can rely on their own savings and loans.
Another risk that a startup takes is that it’s much more idea-driven, rather than service-driven, because this is how you will ultimately make a profit and be successful. If an idea isn’t working, you can’t simply make a few nips and tucks—you have to take a new approach, revamp an idea completely, to take your product or service in a new and bold direction.
Businesses tend to be averse to risk, playing things safe. They want to improve and optimize what’s already going well and not mess with what’s working. Businesses also tend to give more time to projects, often with a 6 to 12-month path, whereas startups are regularly creating ideas within a few hours or even overnight. These worktime factors can also dictate which type of worker and team will be needed to build a successful startup or small business.
Whether you decide to take the small business route or down the startup path, take the time to research the benefits and detriments of each before taking that leap.