Small business

A small business is an organization with less than 500 employees, according to the Small Business Administration. However, a small business can be classified various ways depending on factors like size, revenue, country, and industry, so there is no one set definition.


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What’s the difference between a startup and a small business? 

Some startups fit the definition of small businesses, but one of the differentiators is that a small business doesn’t require major funding or investments like a startup. And while a startup aims to take over the market with an innovative idea or product, a small business may not want more than serving the local community. 

This can also be tied to longevity expectations, with a small business hoping to stick around as long as they remain profitable—while a startup doesn’t intend to remain a startup forever. They may aim to transition into a large, public organization, or even be bought out from a bigger organization. 

What are the characteristics of a small business? 

  • Access to more government support resources and better tax treatment 
  • Difficulty gaining capital 
  • Few employees 
  • Smaller amounts of revenue 
  • More flexible operation 

What are the different types of small businesses? 

  1. Sole proprietorship
  2. Limited partnership (LP)
  3. Limited liability company (LLC) 
  4. S corporation 

What should I know about small businesses? 

  • They make up 99% of all firms in the United States 
  • Small businesses account for 64% of newly created positions in the United States 
  • Millennials and Gen Z are 188% more likely to aspire to create a side business
  • 83% of small businesses have part of their operations online
  • 42% of small businesses fail because of a lack of market demand   

How does user feedback benefit my small business? 

UserTesting’s small business customers have included Krikey and Eargo, among others, and our contributors’ insight has helped them evolve into the organizations you know and use today. 

Here’s a glimpse of what user feedback can help you do: 

  • Grow your business 
  • Improve speed-to-market 
  • Boost confidence in your business decisions 
  • Drive quicker growth and innovation