What’s the secret to scaling up your startup or fledgling business? Well it wouldn’t be a secret if we told you. Never mind, we’re feeling generous so we’ll tell you anyway.
Chances are you may already have an inkling. You just need a push or poke in the right direction. It’s actually all about ignoring conventional wisdom.
It’s all about ignoring conventional wisdom. Yes, that old chestnut.
Scaling up – some definitions
Don’t get me wrong, there’s nothing wrong with a bit of plain and simple inside-the-box conventional wisdom at the right moment. But in our fast-paced times, usually it is not enough. And more than that, it can actually do more harm than good. Especially when you are making strategic decisions about when and how to go about scaling up your business.
First though, let’s get some definitions down on paper here. What is scalability?
Fundamentally scalability is the ability of a startup to grow. Or, to put it another way, a business that is scalable can adapt to a heavier workload without compromising its performance and/or losing revenue.
Let’s face it, however scalable your business may be, not every company can grow to a million dollar enterprise. The fatal mistakes more often than not happen at ground zero. In that some startups get off the ground without the right systems, people, or mindset in place. Trying to grow businesses like this is akin to trying to drive with the brakes on.
So, how you can prepare your startup for scaling up at that crucial starting point?
1. Build strong foundations
Before you even start worrying about scaling up, make sure you have foolproof basics in place. According to the StartupGenom’s survey of 3200+ startups, 74% of failures can be explained by premature scaling. So how can you avoid this?
1. Make sure that people actually want your core product.
It should have ‘market fit’ Yes you can make improvements along the way but you have to make sure you have bases covered like:
- Know who your largest core users are
- Know the marketing channels with the biggest ROI and scaling potential by testing with smaller budgets initially
- Check you have the resources to scale. Whether you need to seek an additional round of funding or not, you simply do not want to run out of money at the scaling stage.
2. Automate, automate and er… automate
If you find that you are spending an awful amount of time setting up your business, then well done. You’re probably on the right track. I’m talking about:
- Setting up cloud storage and organization
- Creating training procedures for new hires
- Digital marketing automation
And these are just a few. It may take a long time and be painful, but it will reap huge dividends long term. Follow the rule that if you can code it, then code it!
3. Growth marketing
A business will struggle to scale if no one knows about it? Focus on marketing, and by marketing I mainly mean growth hacking and content marketing. The former is basically data-informed/repeatable solutions, while the later has both evergreen value and viral potential. The two together are often the go-to solutions for streetwise startups. And don’t forget to focus a lot on social media channels, this is where content lives and breathes (and performs) best.
4. “Outsource“
Obviously if you’re a startup you can’t afford things like in-house graphic designers, SEO specialists, accountants, etc. So, get yourself attached to a an early stage investor who provides some of these services – hello Starttech Ventures’ Venture Building program. This is the Lean Startup approach and it works wonders.
5. Hire the right people (forget the superstars)
Conventional wisdom may say “hire the best”. This is all well and good. If your numbers are looking good and your have the cash. In reality, what you need to do first is “cull the worst”, and then hire only the right people and the right time. And yes, breaking even comes before high salaries. Wait, but what does these “right people” who can help my business scale look like? Well, something like this:
- They can do what a machine can not do. And I don’t mean just produce the best dad jokes. As mentioned, automation is the key to success, but you still need valuable human beings.
- The right people are generally creative. In that they have a lot of great ideas. This is priceless.
- They usually have more than one skill. In the startup environment you need a jack of all trades because one person may have to do two or three jobs. So take on people with multiple skills.
If you follow the above, you should be on the right track to successfully scaling up.
Epilogue
Much like breaking up, scaling up is hard to do (cheesy link to Neil Sedaka’s 60’s classic intended). But you can make it easier. How? By not following conventional wisdom.
Consider this simple example:
Your business is showing promising signs of growth. Logic says you should now go to “the next level”. Use that extra revenue and hire an expensive marketing expert who is going to help you strike while the iron is hot. Or, that expensive, sought-after developer who can add even more panache to your MVP.
Sounds good, right? Well it could actually lead to more problems than helping you scaling up.
Instead, take heed from a few secrets to scaling up from Entrepreneurship expert Daniel Isenberg:
Image by Daniel Isenberg
As you’ll see, it blows a raspberry in the face of conventional wisdom. That’s something you should do too.
