Why do Startups need different marketing approaches?

There are major differences between a startup venture and a small business, primarily your customer base (or lack thereof). Deciding on what business type you are, impacts your digital online marketing strategy choices.

Don't use a Small Business Marketing Strategy for your Startup

2021, August  |   Read in 4 minutes


Deciding your business type is like pushing over the first domino in a long chain reaction.

The first domino to fall greatly impacts all subsequent choices.

For businesses deciding if they are a startup or a small-medium business (SMB), this decision will subsequently affect all future strategy, culture, marketing, UX and overall stakeholder impact.

We’re going to focus on how your business type will impact your online marketing.

The online marketing strategy of SMBs and startups will differ drastically because of the different outcomes each aims to achieve.

We’ll explain the differences between startups and SMBs, then provide examples of marketing elements we recommend for each digital strategy.

Three key differences between SMBs and startups

Let’s get some clarity on your business type.

There are three key factors that separate an SMB from what is considered a startup company: growth expectations, financing and age.

  • Growth projections
  • Financing
  • Age

Growth expectations

A company’s growth prospects are influenced by its business type.

Startups are built to target big investors, who in turn look for big returns in the product being pitched to them. Because of this, the nature of a startup is often based on technology and therefore highly scalable.

On the other hand, small businesses offer more traditional products and services that don’t experience hypergrowth. Instead, these business types opt for well-trodden pathways that keep risk down while maintaining a steady cash flow.


Finance is another key point of difference between a startup venture and small business.

When it comes to money, startups and SMBs don’t speak the same language.

Small business owners focus on building a lower risk product that can provide steady profit. Whereas, startup founders focus on risk-heavy hypergrowth with larger financial losses along the way. They also try to stay hyper-lean with low spending.

Likewise, funding for startups usually comes from venture capitalists, angel investors or government R&D grants to finance rapid growth. On the other hand, small businesses are often financed using a bank loan, personal loan or entirely self-funded.


A startup is usually new.

It will typically be in its first few years of existence either as a concept, idea or minimum scalable product (MSP).

At this stage, the startup concept will likely be unproven, so demonstrating value to investors is paramount. Startups are inherently temporary because they eventually either perish, or morph into SMBs or large corporations.

Small businesses are more likely to stand the test of time than startups.

This is not because they are ‘better’, but because of their business structure.

Australian SMBs have a 40% likelihood of surviving the first three years according to the Australian Bureau of Statistics. SMBs also have a proven history of cash flow, credit history and overall success over this time period.

Which online marketing strategy suits your business type?

Because of these differences, startups and small businesses use totally different digital marketing strategies.

In summary, while SMBs benefit from online marketing to acquire new customers, startups will use online forums to seek out investors.


  • Content marketing — Customer acquisition online for a small business involves using a sales marketing funnel to attract people to an online shop front and convert into a sale.
  • Multi-channel approach — SMBs benefit from a saturated online presence to market their products or services to potential customers. Using as many channels and digital marketing services as possible will increase exposure of the existing business, whether it be Mailchimp for email marketing, Pinterest for image sharing or Hootsuite for social media scheduling.
  • Build for personal use — SMB owners will typically have a hands on strategy when updating their content. They may employ a digital agency to assist, but they will be the ones doing the legwork like responding to online enquiries. As such, the website and channels they use will be operated by them or their team. This makes user-friendly online marketing tools a viable investment.


  • Scalability — Building websites that scale is a non-negotiable for startups forecasting hypergrowth. It means that they can grow without increasing their overheads. Using digital tools that enable scale during the website development stage is crucial for startups.
  • Fast execution — Startups need things to be deployed fast. Technology and platforms online need to work seamlessly to impress investors, something that founders must consider when developing their website and total presence.
  • Build to sell — If a startup venture succeeds, it is possible, even necessary, that it will either merge or be acquired to enable further growth and capital. For web and app developers, this means designing a tool-agnostic, simple, intuitively designed product that any future owners can use.
  • Showcasing — Startups will primarily focus their online efforts on seeking investor funding, growing a user base and doing Alpha and Beta launches. Founders typically focus on providing a minimum viable product that shows off the product and technology.

Whether you’re unsure of the difference between a startup, SMB or other business type, or if you would like clarity on your digital marketing strategy, Book a free consultation with us to digitally strategise for your business.