Hi, I'm Ethan Mollick, and welcome to our discussion on the types of enterprises that are available to someone considering launching a startup. Not all startups are the same. In fact, there are many different reasons why someone might launch a startup and there's many different ways to go about launching a startup company. And as a result, there's a lot of different ways that we have, as entrepreneurship scholars, of categorizing startups in different categories. I'm going to give you a five-category technique to discuss different startup approaches here, but other ways of categorizing are just as valid. So this is just a way of thinking through the reasons why someone might launch a startup, the resources that startup needs to grow, and the approaches they might take to eventually exiting that startup. So there are five real startup types. Lifestyle startups, small businesses, high growth companies, intrapreneurship ventures, and social ventures. Let's go through each of those. So a lifestyle venture is something that's run as a business, or a hobby, or supplemental source of income. People are doing lifestyle businesses because they enjoy what they're doing, they find it satisfying, and they think, maybe I can make a little money out of doing this. The funding here is usually fairly minimal, in that you don't need to raise a lot of funds to make this startup type succeed. You're usually doing this as a hobby in your home, or outside of work, or outside of school. You're not planning on scaling this up, you're not looking to hire more people. Sometimes you end up in this situation where it starts to grow and you grow accidentally, but the goal originally is to run something small, not planning a big exit, not a lot of money. It's a way of making some additional cash doing something you enjoy doing on the side of a regular job or other obligations you might have. The other, and most common business type, is the small business. A small business is almost any kind of startup venture where the goal is not to achieve some sort of fast hyper road through exit, to not do something just for fun, not to [INAUDIBLE] inside an existing company. Most businesses across the world are small businesses. The goal of the small business is, in the words of Steve Blank, to feed the family. You want to be your own boss, and you want to run a business that's turning out some money. Some of these can be very lucrative, some of them less so, but you can think about anything from a restaurant to a dry cleaner to a scrap metal yard. But the goal here is to start a business that is sustainable and doesn't necessarily scale in a huge way. You're open to running a dry cleaning, you may not want to run seven dry cleaners. It's not a necessary goal to expand, certainly not [INAUDIBLE] goal to exit. And these kind of businesses are usually funded through loans, through personal investment, or through family and friends' money. So the vast majority of these businesses do not want to grow. These make up, by far, the bulk of employers in most countries, and is the most common sort of business type. And their goal is to sustainably run it in the long term. Then, there is what many of you I think viewing this course are interested in, which is the high growth startup, or the Silicon Valley style startup. So these startups, the goal is to grow very quickly to scale them up. You want to be the next Google, or Uber, or Facebook, or whatever, or be bought by one of these people. So the goal is, grow quickly. Think about that rich versus king dilemma we discussed in a previous lecture. You either want to make a lot of money, be in control of your own destiny, or some combination of those two. So your goal is to grow very quickly. Usually, you'll need venture capital or angel investment money to make this occur. Although, as you'll see in the funding lectures, there's a variety of choices to approach the funding of these kind of ventures. And you're going to ideally exit through an initial public offering, so go public on the stock market, or through acquisition by, say, Google, or Facebook, or Twitter, or something similar. So this is the high-growth startup that we all hear about so often. There are very small percentage of startups, so around 2% of startups receive venture funding, but the ones that we hear the most about, and is a goal for a lot of people who are taking this course. Another option for startup activities is to not leave your company at all. You can engage intrapreneurship, a startup inside a larger organization where your goal is to develop something new or innovative, help the company change or evolve. Usually you'll use internal company resources, so the risks are relatively low personally. And sometimes the goal is to scale it really quickly, sometimes the goal is to stay with a small group inside the organization. But your goal, eventually, is to have this idea be adapted into the larger firm or even spun off into its own unit. But you're looking to help build company success by building this venture inside the organization. And then, a final approach that you might want to consider as a startup is a social venture. So these are ventures whose primary goal is to accomplish some sort of social good. That could be a charitable thing, that could be some political or lobbying kind of effort, that could be a artistic or cultural effort. But the idea here is less to make money, and more to create some value for society that's important to you. Usually, the resources here are a little different. You're looking for grants, you're looking for volunteers, you're looking for donations. And you're not planning exit, you're hopefully building something sustainable for the long term. So there are many types of businesses out there, and they differ across many dimensions, the kind of goals you want to achieve, the resource you need to make those things happen, where you can actually do these things. So as we'll talk about in some of the other lectures, it's much easier to launch a high-growth company in Silicon Valley than in South Dakota, but a cultural venture may do better in South Dakota than Silicon Valley. And they're also different in how much time they use, what resources you need to take into account. So when you take the lessons here in this course, you'll need to think about adapting them as needed. So some of the things that applies to high-growth ventures, like how to raise venture capital, may not apply to a social venture. But some of the lessons are very universalizable, like how to think about the other [INAUDIBLE] of business. How to gain the resources that you need to succeed, how to reach out to customers. So as you go forward in the course, think about these issues, think about your own goals and motivations about why you are launching a venture. And make sure they match together with the types of ventures that are available to you.