Is it a Start-up? A Social Enterprise? Or an NGO?

Just so we don’t get confused, here are a few handy definitions I picked up on the internet that I think are fitting 🙂

START-UP

A company that is in the first stage of its operations. These companies are often initially bank rolled by their entrepreneurial founders as they attempt to capitalize on developing a product or service for which they believe there is a demand. Due to limited revenue or high costs, most of these small scale operations are not sustainable in the long term without additional funding from venture capitalists.
– from Investopedia

A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.

In every case, the organization is dedicated to uncovering a new source of value for customers, and cares about the actual impact of its work on those customers.

 Many startups don’t innovate at all in the product dimension, but use other kinds of innovation: repurposing an existing technology for a new use, devising a new business model that unlocks value that was previously hidden, or even simply bringing a product or service to a new location or set of customers previously underserved. In all of these cases, innovation is at the heart of the company’s success… The real question is: “what is the degree of innovation that this business proposes to accomplish?”

Startups are designed for the situations that cannot be modeled, are not clear-cut, and where the risk is not necessarily large – it’s just not yet known.

Startups are designed to confront situations of extreme uncertainty. To open up a new business that is an exact clone of an existing business, all the way down to the business model, pricing, target customer, and specific product may, under many circumstances, be an attractive economic investment. But it is not a startup, because its success depends only on decent execution – so much so that this success can be modeled with high accuracy.

– from Startup Lessons Learned

A startup is a temporary organization working toward a business model that is scalable, repeatable and profitable. The startup lifecycle begins with a business model based on ideas and guesses, since there are no customers and very little customer knowledge.

Different kinds of Startups: a) Small Business Entrepreneurship, b) Scalable Startup, c) “Buyable” Startup, d) Internal Startup, and e) Social Entrepreneurship.

– from Top MBA Connect (see link for the definitions of the kinds)

SOCIAL ENTERPRISE

Social enterprises are revenue-generating businesses with a twist. Whether operated by a non-profit organization or by a for-profit company, a social enterprise has two goals: to achieve social, cultural, community economic or environmental outcomes; and, to earn revenue. On the surface, many social enterprises look, feel, and even operate like traditional businesses. But looking more deeply, one discovers the defining characteristics of the social enterprise: mission is at the centre of business, with income generation playing an important supporting role.

An equally noble goal of social enterprise (aside from generating revenues to pursue more of a non-profit’s mission) is the involvement of the marginalized, thus creating capacity and self-sufficiency for individuals, and impacting their communities and lessening reliance on the social safety net.

– from BC Centre for Social Enterprise‘s site

Social enterprises can be defined as “organisations with an explicit aim to benefit the community, initiated by a group of citizens and in which the material interest of capital investors is subject to limits. They place a high value on their independence and on economic risk-taking related to ongoing socio-economic activity.

– from The Emergence of Social Enterprise

NON-GOVERNMENTAL ORGANIZATION

The World Bank defines NGOs as “private organizations that pursue activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social services, or undertake community development” (Operational Directive 14.70).  In wider usage, the term NGO can be applied to any non-profit organization which is independent from government.  NGOs are typically value-based organizations which depend, in whole or in part, on charitable donations and voluntary service.  Although the NGO sector has become increasingly professional over the last two decades, principles of altruism and voluntarism remain key defining characteristics.

– from Duke University Libraries

A non-governmental organization (NGO) is an organization that is not part of a government and was not founded by states. NGOs are therefore typically independent of governments. Although the definition can technically include for-profit corporations, the term is generally restricted to social, cultural, legal, and environmental advocacy groups having goals that are primarily noncommercial. NGOs are usually non-profit organizations that gain at least a portion of their funding from private sources. Current usage of the term is generally associated with the United Nations and authentic NGOs are those that are so designated by the UN.

– fron NonProfitExpert.com

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