A stealth startup is one which tries to avoid any public attention.
So why would a startup try to avoid any attention because as we know, the more
attention a business gets, the more potential customers.
The reasons for a startup operating in stealth mode can be
the following.
Protecting the Idea
– We all know that ideas, once in the public domain, get copied. Filing a
patent is a lengthy and expensive proposition. Hence some entrepreneurs prefer
to run their startup in the stealth mode upto a point where they are able to
gain sufficient traction and headway over others who might look to copy the
idea.
Product –
Entrepreneurs running in stealth mode also look to keep fine-tuning their
product before it goes into the public domain. Generally the product is tested
with a small group of people who generally are asked to sign an NDA.
With these advantages comes some disadvantages of running in
stealth mode.
Attracting
Stakeholders – Without publicity, the stealth startup may find it difficult
to attract stakeholders like employees and investors. The startup’s public
image plays an important role in getting these stakeholders onboard.
Testing – Since the startup prefers to limit usage to
only a handful of users, there may be a risk of getting results based on data
which is inadequate and biased.
BloomReach is a startup which serves as a good example. They started out in stealth mode as they were trying to offer SEO as a service, a service which requires a lot of investment in the product and which could be copied quite easily. The team realised that good execution is more important than being out there early on itself. When the startup launched publicly, it was a great success.
BloomReach is a startup which serves as a good example. They started out in stealth mode as they were trying to offer SEO as a service, a service which requires a lot of investment in the product and which could be copied quite easily. The team realised that good execution is more important than being out there early on itself. When the startup launched publicly, it was a great success.
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