A few weeks ago, we looked at what a startup is, its characteristics, and how it differs from small and medium-sized businesses. 

In this post, we'll talk about the different types of startups.

1. Scalable: are arguably the most popular type among these businesses. They are characterized by having an idea that can be developed at low cost and replicated in various contexts. These startups are generally in the tech sector, since with modest resources they can reach a global audience and offer the same service everywhere.
2. Social startups: While all startups aim to scale and grow in the global market, the reality is that many of these companies are not focused on generating large profits, but rather on offering a quality service or product to as many consumers as possible. These startups are distinguished by their focus on the scalability of a business model without prioritizing high profits, even though the venture must be profitable and generate the resources necessary for its survival and replicability . These types of startups exemplify how to do business with a focus on social responsibility. 
3. Startups for Sale: Many ideas emerge with the goal of becoming a real project, and generally, it is the founders of a business who hope to live out the dream of owning a company and generating profits from it. However, there are some entrepreneurs whose sole purpose is to generate business ideas to sell to others. Startups for sale are business ventures that aim to appeal to a larger buyer or that prove profitable enough to convince someone to acquire them and integrate them into their organization.
4. Primary startups: In contrast to startups that can be acquired, primary startups can be defined as those that arise from a passion on the part of the developer, entrepreneurs, and investors as a life project. These companies do not seek to be acquired by other companies, but rather to establish themselves in the market and develop their own identity. These startups are also known as “passion-driven” or “lifestyle” startups. This is because they arise from an emotional interest or the search for a solution to an everyday problem. This passion transforms into a business idea that can be useful to thousands or millions of people.
5. Secondary startups: A third type of startup, defined by who creates it and its purpose, is the side startup. These business units are characterized by the fact that they are not a company’s main project, but rather serve as idea labs. Some developers work on them or even compete to create innovative platforms, solutions, or software that may receive capital investment if they prove their value. Large companies constantly fund these types of startups with the aim of adopting their solutions as soon as their profitability becomes evident. Therefore, they do not arise from the interest of their creators, but rather as a service to other entrepreneurs.

More and more entrepreneurs are joining the startup ecosystem, where the focus is on innovation, and we can also find startups dedicated to a wide variety of fields, always with the technological component that defines them. 

For more than three years now, andat Fynsa AGF, we have met with more than 80 Latin American startups, with whom we have developed various financing strategies through debt financing for asset purchases. 

If you'd like to learn more about these options, you can email us at [email protected] 

Fynsa Private Debt Team