White Paper

Why Governments Must Distinguish Startups from Small Businesses

Governments around the world have long relied on a monolithic view of entrepreneurship; treating all privately owned, revenue-generating ventures under the umbrella term "small business." This conflation has undermined the efficacy of economic development policy, misallocated public resources, and failed to keep pace with the modern innovation economy. A startup is not a small business, and without a governmental framework that recognizes this crucial distinction, we risk handicapping the very ventures that fuel economic growth, job creation, and competitive global leadership.

Rooted in the evolution of startup ecosystems and innovation policy, this white paper provides policymakers with a mandate for change — outlining the differences between startups and small businesses, the economic stakes involved, and a path forward exemplified through the U.S. Small Business Administration (SBA).

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