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A startup company or start-up or high tech startup company is a business with a limited operating history. While slow-growth businesses may be startups, investors are most attracted to those new companies distinguished by their risk/reward profile and scalability. That is, they have lower bootstrapping costs, higher risk, and higher potential return on investment. Successful startups are typically more scalable than an established business, in the sense that they can potentially grow rapidly with limited investment of capital, labor or land.

Startups enjoy several unique options for funding. Venture capital firms and angel investors may help startup companies begin operations, exchanging cash for an equity stake. In practice though, many startups are initially funded by the founders themselves.

A company may cease to be a startup as it passes various milestones, such as becoming profitable, or becoming publicly traded in an IPO, or ceasing to exist as an independent entity via a merger or acquisition.

Startup companies, particularly those associated with new technology, sometimes produce huge returns to their creators and investors - a recent example of such was Google, whose creators are now billionaires through their share ownership. However, the failure rate of startup companies is very high. Based on a research, Founder CEOs of high-tech companies can typically expect their stock to be worth about $6,500,000 (statistical average) if the company succeeds in going public(in 1997)^[1]

While there are startup businesses created in all types of businesses, and all over the world, some locations and business sectors are particularly associated with startup companies. The Internet bubble of the late 1990s was associated with huge numbers of internet startup companies, some selling the technology to provide internet access, others using the internet to provide services. Most of this startup activity was located in Silicon Valley, an area of northern California renowned for the high level of startup company activity.

The first critical and pivotal task in setting up a business is to conduct research in order to validate, assess and develop the ideas or business concepts in addition to opportunities to establish further and deeper understanding on the ideas or business concepts as well as their commercial potentials.

As many High Tech "Start-Ups" Emerge out of key Universities like Stanford, MIT, and Austin, TX, with their resources and infrustructure, we see a pattern and structure to this high tech infrustructure formation around areas with many good colleges and innovative, bright, PHD specialists who can take each field of expertise, in each market segment, to the next level of standardized frameworks for innovations in that market segment. To understand the fundementals of the Entrepreneur and Start-Ups, please read the following legendary writing:

"Innovation and Entrepreneurship" by Peter F Drucker.

And read the top 50 Venture Capital Firm Portfolios (Online) to see the Market Sectors that are getting funding these days:

http://www.svdaily.com/capital.html

http://www.masshome.com/venture.html

http://www.massinvestor.com/svase.htm

http://www.capitalvector.com

It is important to understand that less than 20% of Start-Up Companies are very successful, and certain high performance skills and management are required to realize the good business plans of successful start-ups. Therefore, investing in Start-Ups is extremely risky, compared to other, lower risk investment vehicles.

Contents 1 See also 2 Further reading 2.1 Technical guides 2.2 Startup biography 3 References

• Entrepreneurship
• Business plan
• Venture capital
• Private Equity
• IPO
• Exit strategy
• Silicon Valley
• Stock market bubble
• Liquidity event
• Business incubator
• Not Just For Profit
• Startupers

• New Venture Creation, Jeffry A. Timmons, ISBN 0-07-287570-4

• How to Start a Startup, by Paul Graham
• Why Not Not Start a Startup, by Paul Graham

• "High Stakes, No Prisoners: A Winner's Tale of Greed and Glory in the Internet Wars" Charles Ferguson, ISBN 0-8129-3143-2
• "Startup: A Silicon Valley Adventure", Jerry Kaplan ISBN 0-395-71133-9
• "Burn Rate:How I Survived the Gold Rush", Michael Wolf, ISBN 0-684-84881-3
• "Go BIG or Go HOME: How the next generation of startup companies think BIG, grow FAST, and dominate markets overnight", Wil Schroter, ISBN 1-599-71274-1