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3 Types of Startup Firms

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When you’re defining the objectives of your new startup, you’ll fall into one of three categories:

●  Salary-substitute businesses

●  Lifestyle companies

●  Entrepreneurial organizations 

Knowing where you fall within these three types of startups is the first step to establishing your goals. This guide will explain what each organization type means and how it dictates the best hiring practices for small businesses.

What Is a Salary-Substitute Business?

Many self-employed people start a new business to replicate the earnings they were used to when they worked for an employer. 

In short, a salary-substitute venture is usually one professional offering their services directly to clients, rather than working for a large company as an employee.

Usually, a salary-substitute company will be: 

●  A small business startup run by one primary individual

●  Service-based, reliant on a pre-established skillset 

This type of company differs from an entrepreneurial enterprise since it offers an existing service or product rather than bringing something new to the market. 

Most salary-substitute companies will consider the advantages of hiring contract workers if they decide to scale up since they’ll look to outsource any excess work rather than expand the business.

If you were an accountant working for a practice and decided to become self-employed to enjoy more flexibility in your working hours, you’d be a salary-substitute business.

How Do Lifestyle Startup Companies Work?

A lifestyle startup is somewhat different and exists to support the earnings of the owners. 

That doesn’t mean a lifestyle business can’t rapidly grow and achieve success, but it’s driving aim is to provide income for the private shareholders.

Examples of lifestyle businesses also include hobbies and personal interests, acting as a creative outlet, rather than aiming to grow and achieve higher turnover each year.

Is My Business an Entrepreneurial Firm?

Our third type of startup firm is perhaps the most dynamic!

If your business is doing any of the below, it’s an entrepreneurship: 

●  Developing a new concept or idea that doesn’t already exist.

●  Launching products that are fresh to the market.

●  Seizing opportunities to meet changes in market demand. 

It isn’t easy to quantify the parameters of what makes a great entrepreneurial firm since these organizations can exist in any sector and any industry. 

While innovation is the cornerstone of success, establishing an entrepreneurial startup can be challenging when attracting investment to bring those creative ideas to fruition.

Why Is the Nature of My Startup Business Important for Recruitment? 

There is no right or wrong reason to establish a new business. 

However, you do need to understand the nature of your organization since this will be vital in making critical decisions and recruiting contractors or staff to help run the company. 

Quality candidates won’t jump at any employment opportunity but will consider: 

●  The longevity of their position within the organization.

●  Business culture and the workplace environment.

●  Your overarching aims and potential for growth. 

If talent is a top priority for your startup, and you’re hoping to attract exceptional professionals, these elements will make a substantial difference in the caliber of applicants. 

Once you spend a little time defining your business’s trajectory and what it stands for, recruiting outstanding employees, such as hiring a content writer, will be a more streamlined process and will reap better results!

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