Types of Start-up's
Any start-up in its early stage faces the twin challenges of optimizing
money and time. All product-based start-ups spend money upfront to build an
asset, which they monetize later. Therefore, the engineering cost of the
product needs to be kept in check and hence, the need for finer scope control.
Risk capital management is the model required here.
A service-based start-up
starts making money at a much earlier stage and is more about working capital
management than risk capital management.
The operating model for any start-up at its early stages is a blend of
these models, at least till it finds its bearings in the market.
