Why startups matter

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Startups are engines of progress. When you think about the world’s biggest challenges, the things that seem unfixable—climate change, disease, access to education—startups offer a glimmer of hope.

They’re not bound by the constraints of large corporations or governments. They start small, they move fast, and they take risks. And in doing so, they have the potential to change everything.

At their core, startups are experiments in making something better.

In almost every case, the people behind these ventures have identified a problem in the world that either hasn’t been solved or hasn’t been solved well. Then they take on the hard work of figuring out a solution.

Not all succeed, but the ones that do can revolutionise industries, create new ways of living, and alter the trajectory of society. Here’s some of the key reasons why startups matter.

1. Startups solve real problems

One of the reasons startups matter is that they focus on solving real problems, often problems that people don’t even realise they have.

Many of the most successful startups didn’t just make existing solutions slightly better; they introduced completely new ways of thinking about things.

Uber didn’t just make taxis slightly better; it fundamentally changed how we think about transportation. Duolingo did the same for how we think about language learning. And the list goes on—startups don’t settle for incremental improvements, they aim for leaps forward.

Large companies, especially successful ones, are often reluctant to disrupt their own businesses. This isn’t because they’re inherently lazy or evil. It’s because the structure and culture that made them successful in the first place makes it hard for them to change course.

They have shareholders to please, existing customers to serve, and large teams to manage. If they do innovate, it’s usually in small steps, carefully measured.

Startups, on the other hand, are built to take risks. They don’t have a choice. No one will notice them unless they do something dramatically better or different.

They’re not held back by the inertia of large organisations, and they can afford to take big swings, knowing that failure is a real possibility.

2. Startups can innovate freely

In many industries, innovation is stifled by regulation, bureaucracy, and existing power structures. But startups often find ways to innovate by simply working around these roadblocks.

For instance, many of the most successful startups in the tech industry were initially seen as frivolous or niche.

Social media platforms, for example, were initially dismissed as a waste of time. But startups like Facebook and Twitter persisted, and in doing so, they created entire industries and changed how people interact.

A startup doesn’t need to ask for approval from a board of directors or spend years navigating government regulations before they can begin experimenting.

They start by building something simple that people want, and then they scale from there. This ability to move fast is crucial to their success.

And it’s not just in tech. In the energy industry, startups are tackling renewable energy, creating new technologies that make clean energy more affordable and accessible.

In healthcare, startups are developing new drugs, therapies, and medical devices faster than ever before, often bypassing the sluggish traditional routes by securing private funding or crowdfunding.

The key is that they don’t wait for permission. They build, test, and iterate quickly.

3. Startups lead to progress faster

Startups move fast because they have to. There’s a saying in the startup world: “If you’re not embarrassed by the first version of your product, you’ve launched too late.”

This idea emphasises how crucial speed is for startups. Their biggest advantage over established companies is that they can try things quickly, fail fast, and learn from those failures.

Big companies are slower because they have more to lose, but startups live and die by how fast they can adapt.

This speed allows startups to take advantage of new technologies and changing market conditions in a way that large corporations often can’t.

For example, when the internet became mainstream in the 1990s, it was startups like Amazon, Google, and eBay that capitalised on the opportunity, not the traditional retailers or media companies. These startups were able to move quickly, build something new, and ride the wave of a growing market.

The same thing is happening now with artificial intelligence, blockchain, and renewable energy. Startups are at the forefront, developing new applications and finding creative ways to use these technologies.

They’re able to do this because they can afford to move quickly and take risks.

4. Startups create new markets

Startups don't just disrupt existing markets, they often invent entirely new ones.

Take Apple, for example. It started as a small tech company and ultimately spearheaded the mobile app revolution. Before Google, the online advertising market as we know it didn’t exist.

These startups didn’t just carve out niches, they built industries from scratch. Today, mobile apps and online advertising are massive, multi-billion-dollar markets.

When startups succeed, they create ripple effects: new markets emerge, sparking job creation, innovation, and wealth. Entire ecosystems often grow around these pioneering companies.

Think about the app economy. Thousands of businesses now exist solely to support it, from developers and marketers to data analysts and platform specialists. None of this would have been possible without the initial push from innovative startups.

Startups also fuel opportunities for other startups. When a company creates a new market, it opens the door for others to follow, carving out niches and building on the foundation.

Consider online marketplaces. The first was groundbreaking, but now we have specialised platforms for everything from handmade goods to freelancer services. Each new startup adds layers of innovation, creating a snowball effect that accelerates progress.

5. Startups can take risks big companies can’t

Startups matter because they take risks that established companies won’t.

It’s easy to look at the successful startups and forget how many of them started with what seemed like impossible odds. Founders often put everything on the line—their time, their money, their reputation—to pursue an idea they believe in.

More often than not, they fail. Most startups don’t become the next Google or Amazon. But the ones that do succeed make the risk worth it for everyone involved.

Failure is a part of the process. The reason startups are so important is that they operate in a way that embraces failure as a learning tool.

Large corporations can’t afford to fail in the same way, but for startups, failure is expected.

This willingness to take risks is what allows startups to pursue bold ideas and ambitious goals. If startups didn’t exist, we’d miss out on the kind of progress that comes from taking those risks.

6. Startups shape the future

The reason startups are so important is because they’re creating the future.

Right now, somewhere in the world, there’s a small team working on a project that will change the way we live. It might be a new technology, a new product, or a new way of thinking.

Whatever it is, the team behind it is doing what startups do best: they’re imagining a better world and then doing the hard work to bring that vision to life.

Startups matter because they don’t just adapt to change; they create it. They see where the world is going and they help get us there faster. Without startups, progress would slow, and many of the innovations we take for granted wouldn’t exist.

Think about the most exciting advancements in technology, healthcare, education, and clean energy. Behind most of these innovations, you’ll find startups.

Final thoughts

While not every startup will succeed, the ones that do will shape the future in ways we can’t even imagine today.

This is why startups matter—they take on the biggest challenges, solve the toughest problems, and, in the process, create a better world.

At Stone & Chalk, we help startups go further, faster. If you want support on your journey through entrepreneurship, find out how you can join us.