The Six Stages of a Startup

The Six Stages of a Startup

So, you’ve decided to take the plunge with your most recent business idea. What now? Knowing how to get to where you want to go is essential, and that path winds through the many life stages of a business. Depending on the founder and the industry, each stage can take years, but experienced founders can leapfrog things ahead exponentially.

Research Mode

Businesses often adapt and evolve until they no longer resemble what they originally were at the start. Getting your product/market fit (PMF) right — and adjusting it as needed — is crucial.

In the beginning is the lightbulb moment, the idea. Ideas happen all the time, and most of them are bad. It is always exciting when you initially come up with an idea for a business, but within 24 or 48 hours, that honeymoon phase is typically already over as problems and hurdles come to light. The main criteria to consider are: whether the business could be big enough, the barriers to entry and the competitive landscape. The ideas that survive this initial research phase get additional attention and research to determine if they’re worthwhile. Some entrepreneurs will jump in, while others will spend months or years in thinking and research mode.

The Decision

A decision is made to pursue or not to pursue. Will you take the leap or go after something else? The decision to go forward is a critical moment because that’s when it starts costing money, time and energy. For the ideas that survive, this is usually the time to begin researching domain names, business names and brand names, planning how the business would operate, determining costs and budgets, and talking to potential customers.

Some people get very secretive during this period. They avoid sharing their idea, fearing someone else will steal it, and often demand that people sign NDAs before talking to them. Yet while people do sometimes steal ideas, most people are too busy with their own projects to steal yours — and by keeping it secret, you may also lose out on free and often valuable feedback from people you trust.


It will usually take time to build the business, gain traction and validate your ideas and strategy. Success will depend on how you execute your plan and build the company, and how people find your product. Stealth-mode development may take years, and perhaps you never have to announce it publicly. Maybe you’ve built a software or business solution custom-tailored for your pre-existing business, before realizing it could prove to be valuable to others. Either way, there will hopefully come a moment when your business takes off. I usually know if I have a winner within one to three years, when things start to move with a life of their own.


Businesses often adapt and evolve until they no longer resemble what they originally were at the start. Getting your product/market fit (PMF) right — and adjusting it as needed — is crucial. Things will change as the business’s needs change, like how software being actively developed is never “completed” and always has ongoing development costs.

For example, my business was initially built to sell advertising on my network of websites. Text ads were Google’s bread and butter at the time, but since porn is a visual product, we displayed banner ads instead. After a few friends used it for a while, it was launched publicly, but then the product changed. Initially, I operated my own paysites and advertised them in all spots; only when someone else bought an ad spot would it change to something else. So, publishers set their own ads initially. When we introduced run-of-network campaigns and required at least a 25% rotation of “filler ads,” some publishers revolted. Not everyone takes well to innovative change. Networkwide ads are now the industry standard.


With consistent momentum, traction and adaptation, your company is ready to scale. You turn the marketing engine on full blast, hire more salespeople and execute based on your systems. This is how a business becomes a stable and established company. Beware of the impulse to scale before being profitable. It is one thing to have a good PMF, but you need a path to profitability before attempting to scale, unless the math shows that scaling is your path to profitability. Scaling a business that doesn’t work on a small scale will often accelerate its failure, with rising costs and no way to pay for them.

Acquisition Strategy According to Life Stages

After you’ve made it through these stages and want your company to grow faster, you can accelerate it with acquisitions as the big buys do. When acquiring and buying websites and businesses, you want to focus on purchasing in the later life stages; after all the initial work is done, the company has traction and is scaling. Bypassing businesses in the early stages is advisable because they are the riskiest and most expensive, and where more than half of business failures occur.

If you are still interested in buying a business in the early stages, such as one that has been built but has yet to launch — and therefore has no revenues or sales yet — do your due diligence very carefully. You will want to make sure that this business fits your vision and offers a concrete way to fast-track your goals, because it would likely be just as cost-effective to rebuild it yourself from scratch.

While there are never any guarantees, by anticipating the stages listed above, and proactively ensuring that your business evolves at a steady pace and progresses through those stages, you can definitely improve your odds for long-term success.

Juicy Jay is the CEO and founder of the JuicyAds advertising network, as well as the founder of Broker.xxx, which helps people buy and sell adult websites and businesses. He also provides executive consulting, business strategy and marketing services at Consulting.xxx.


Copyright © 2023 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More Articles


WIA: Sana Gaziani

Sana Gaziani has always been industrious. She worked in retail for over 20 years, first as a teenager selling chocolates door-to-door and then in multiple part-time jobs at grocery stores. She worked at cosmetics company Lush to put herself through college, where she studied to become a law clerk.

Women In Adult ·

Ensuring Subscription Billing Is a Win-Win for Businesses, Customers

Subscription billing is one of the fundamental cornerstones of our industry. Marketing practices and processing technologies have evolved, but the basic concept has remained unchanged.

Jonathan Corona ·

The Importance of a Modern Tech Stack

You’ve built your website or platform. It is a fantastic piece of software, it works — and even better, your customers love it. You’re done developing, so now you can fire all your developers and not renew your contractor agreements. Right?

Brad Mitchell ·

Unpacking Mastercard's Enhanced Communication Path

Sharing information is important between card associations and service providers like payment facilitators and independent payment operators. In those relationships, information typically flows from the card brands to the acquirers, and then to service providers.

Cathy Beardsley ·

Piracy Battlefront: Content Protection Watchdogs on Evolving Threats, Solutions

Thanks to the creator economy, the rise of indie paysites and a cross-pollinating ecosystem of affiliates, studios and multibrand behemoths flooding the internet with billions of photos, videos and text messages, there has never been such a treasure trove of adult content online. But where there is treasure, there are pirates.

Alejandro Freixes ·

A Steady Pace & Realistic Goals Are Vital for Empire Building

I’ve seen countless websites and businesses fail to launch because the project exceeded the budget for development, and nothing was left for marketing or building a team. The dreaded cash crash.

Juicy Jay ·

Unveiling the Future With Mastercard's New AI Rules

As technology advances at an unprecedented pace, the role of artificial intelligence (AI) in driving innovation across industries has become crucial. The financial services sector, in particular, has recognized the potential of AI to improve efficiency, accuracy and customer experience.

Jonathan Corona ·

Eyes on the Site: Strategies for 24/7 Website Monitoring

Back in the 1990s, there were all sorts of companies that would scan your website and let you know if and when it ever went down. Ah, the memories. Site monitoring has since advanced far beyond those humble beginnings. Today, most websites are more complex, and checking whether one is online or not is not as simple as it used to be.

Brad Mitchell ·

Understanding Visa's New Pricing and High-Risk Tiers

In April, Visa announced that it was rebranding its Global Brand Protection Program as the Visa Integrity Risk Program (VIRP). The program is designed to strengthen the integrity and security of the Visa payment system.

Cathy Beardsley ·

WIA Profile: Caroline Karolinko

When Caroline Karolinko joined Segpay in 2018, she did not know a lot about the adult industry. After graduating from the University of Florida with a master’s degree in speech-language pathology, she worked with autistic youth and others with behavioral disorders.

Women In Adult ·
Show More