Startups are emerging or entrepreneurial companies that seek rapid growth in the market from a technological base and innovative business ideas.where their main characteristics are:

•         Innovative idea and/or underserved market.
•         Use of technological tools.
•         Highly adaptable business model.
•         A commitment to accelerated growth.
•         Has a higher risk
  

What are the differences between a startup and an SME?

1. The objectives: Startups are characterized by innovative ideas that seek to position themselves as unique solutions in the market. This ultimately aims to grow at an accelerated rate and capitalize on their ideas with large short-term gains. An SME, on the other hand, seeks to establish its presence in the market organically and, although it may aspire to become a large company, this is not necessarily its main objective.
2. The marketOne of the most characteristic points of a startup is that it aspires to reach a broad audience. Because these businesses seek accelerated growth, the surest way to achieve this is to create a commercial need of mass interest or bring a service to a large number of consumers. Thanks to the use of digital tools, startups can offer their solutions to everyone. SMEs, on the other hand, emerge as a response to a generally local problem and tend to have a highly delimited audience, either because of their age, the territory in which they operate or whether or not they belong to a community.
3. FinancingStartups arise from an idea, but their creators do not necessarily have the resources to bring this solution to the market. Often the investment required to start the business does not depend on them but on the contribution of investors and financial assistance that bet on the success of the idea. Without sufficient capital, these ideas cannot take off. On the other hand, SMEs generally arise from a commercial need of the entrepreneurs from the use of their own resources or by acquiring credits. In case of not having too much capital, small and medium-sized companies are compromised and have a much slower growth.
4. Size: SMEs, as their name suggests, are micro, small and medium-sized companies that, because of their number of employees and level of revenue, represent smaller business units in the corporate world. Generally, their financial and organizational size places them in this category. In the case of startups, there is no correlation between one element and the other. These businesses can have a highly reduced number of personnel and, nevertheless, obtain millionaire profits. Moreover, according to the points we have developed, a startup only exists as a step on the road to success.

In that sense, at Fynsa we have developed a track record in Private Debt, and with several strategies that have supported Fintech, both in the form of debt and Equity, pioneering the first Venture debt fund in Chile. We currently have more than US$35 MM under management for Venture funds and with a track record of more than US$50 MM in the last 3 years.

Fynsa Private Debt Team