How are B2C and B2B businesses different in a startup setting?

Generally, b2c (business to consumer) ventures can get going very quickly, but scaling is tough, because each customer pays a small amount and you need a lot of customers to generate a significant amount of revenue. There may also be natural churn that you have to deal with. For example, an ed tech startup focusing on the preschool years may make a few hundred dollars off a household with 2 or 3 kids per year – and then they age out of that developmental stage, and the company would have to take that into account in terms of the marketing they need to do to keep acquiring new customers.

B2B (business to business) ventures take a very long time to get going, as large organizations have processes and take months or even years to adopt something new. But once you get in, the deal size can be very big and they tend to stay for a long time. For example, it can take 18-24 months to convince a large hospital system to adopt a new healthcare IT system. It is very slow and frictionful. However: Once you are in, you will virtually never be removed – because it is much more disruptive to stop using a new system than keep working with the vendor to address issues and make it better.

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