JournalOct 2014

We’re not a startup. And that’s a good thing.

I think too many people (and I would include myself in this group a few years ago) have the misconception that a startup is just a company with a new business idea that they’re trying to make work.

The startup world has an incredible allure, and being constantly exposed to it, working with startup clients all the time as we do, it is inevitably going to turn your head and make you want feel a part of it and self-identify as a ‘startup’.

And while a ‘start up business’ was perhaps once taken by many to mean simply a “new business”, that’s definitely not what we mean when we refer to a startup nowadays, particularly in the context of the tech industry. As Eric Reiss says:

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

And by this definition, Hanno isn’t a startup. Sure, we’re a (relatively) young business, and we’ve been trying out many different ideas with the goal of taking a very different approach to our business, and doing things in a better way to many agencies. But we’re not searching for some mythical product-market fit in an incredibly uncertain environment. And there’s no shame in admitting that–far from it.

Amy Hoy explains the difference very well:

“Startups are made of risk. They’re risk generators. If you could actually reduce startup risk, does that even make any sense? A low-risk startup would make customers, make money, fund itself, and grow slowly. You might even call it a business. Which means it’s not a startup, just a business that is… new.”

As far as we’re concerned, clients need designers and developers; we hire said talent and work with them; clients are prepared to pay for our services; we reduce our costs to be less than the fees clients are prepared to pay; we profit, and grow. It’s not as though the path has never been walked before.

If Hanno was a startup, well, that would make us far less appealing for the real startups to work with. A startup has enough risk already, without constantly taking risks on other startups to help them succeed. They want a great team they can depend on–they don’t want to take a long shot that might pay off spectacularly, but is more than likely to fail.

I actually think more companies should be open to admitting that they’re not startups, because I believe it can be a healthy ingredient for longer-term success.

While we need startups in order to achieve many particularly ground-breaking developments, and take us from zero to one, many of these developments rely heavily on non-startups being able to support them.

Not being a startup doesn’t mean you’re any less valuable.

Posted by
Jon Lay

Jon is a Partner at Hanno. He wears many hats, but his primary focus is on leading our engineering and technical operations.