What is a common characteristic of startups?

Startups commonly seek funding to grow rapidly because they often operate in a dynamic and competitive environment where scaling their business quickly is essential for success. The nature of a startup typically involves high levels of uncertainty and the need for capital to support growth initiatives, such as product development, marketing, and hiring skilled employees. This funding often comes from investors who are looking for high-risk, high-reward opportunities, allowing the startup to leverage external resources to expand its operations and reach potential customers more effectively.

In contrast, other options do not reflect the typical characteristics of startups. For instance, startups usually do not have a well-defined market or an established customer base, as they are in the process of testing their business model and market fit. Additionally, most startups prioritize innovation and market disruption over immediate profit, aiming to create new solutions rather than focusing solely on financial gains in the early stages of their operations.