The path startups take

What development path awaits any startup? In the startup industry, most often every startup founder dreams of becoming a unicorn, that is, a company valued at more than one billion US dollars. However, only a handful become unicorns. Most startups, of course, fail to reach this mark. A large share of startups die altogether, while others keep operating. That is why, for myself, I divide startups into three categories. The first category is the so-called rockets, which soar upward rapidly in a very short time and bring their investors returns many times over.

Examples of such startups include Facebook and Airbnb at the very beginning of their journey. These really were small companies, small startups, but in a very short time they turned into multimillion-dollar companies. The second scenario is a take-off followed by a transition to a flatter trajectory in the form of a plateau. I call this path the airplane path. Most large industrial and other companies in the world are, in essence, airplanes. They have reached a certain altitude and are now flying at the same altitude. Their fluctuations are not as strong, but they are pillars of the economy: they bring huge revenues to the country and to their shareholders and pay salaries.

For example, companies like McDonald's, Coca-Cola and Microsoft. Even startups like Facebook and Airbnb have by now turned from rockets into airplanes and are flying along a more or less flat trajectory. And finally, the third scenario, which I call the hang glider path. This is when a startup seems to rise rapidly at first, but then it has neither an engine nor fuel. In our case, this means there were no good metrics, no sales, no steady growth in customers. And the investment ran out. Such a startup, like a hang glider, even when it is at a great height, then slowly but inevitably falls down.

Speaking about these three startup development scenarios, I want to note that, of course, startups should have grand ambitions and plans. You should dream of becoming a unicorn and conquering the whole world. But I want to say that a great many companies and startups are, in essence, airplanes. They operate steadily and bring profit to their shareholders. So you should not despair or be disappointed if you did not manage to become a unicorn. You can remain a successful company by reaching a certain altitude and staying there for a long time. For example, by remaining a regional company or even a domestic one.

Here in Kazakhstan, there are many companies that used to be startups, IT companies, that have reached a certain altitude and now generate a million US dollars or more every month. That is, they have remained successful companies for a very long time. This development path is not bad either, and it should not be dismissed.