There’s plenty of advice around on how to get a startup off the ground – but less about how to scale up effectively, arguably the trickiest phase in a business’s life cycle. Here’s what the South-west’s growth experts have to say.
We spoke to five people who know all about growing startups, whether from building their own or helping others expand and thrive.
Here’s a flavour of the expertise you’ll find at our D/B/M#9 Growing Startups event on 18th July At Engine Shed, Bristol.
Thanks for chatting to us! What are common growing pains for scale-ups?
Becky: The biggest growing pain [for Interactive Scientific] was the burn rate you have to keep up – the higher the burn rate the higher the stakes and the harder it is to respond to new opportunities because you aren’t as agile. […] The size of our burn was not allowing us to take the time to think about the best strategy and positioning of the business, because all we were doing was trying to generate revenue and investment.
When it became clear that we have a much bigger opportunity, it was important to slow down the burn in order to reposition and tell a bigger story.
‘If [a scale-up] starts out with an under-provisioned
infrastructure, they’ll need to invest in a more robust and scalable solution.– Nic Alpi
Briony: The Scaleup Institute are the real experts on this topic – for our region, they stress that the main barriers to growth are talent and markets and customers. I hear a similar story from the companies I speak to.
Greg: For Immersive Labs, it was not hiring an in-house resourcer soon enough, which led to bigger costs and a slow down in hires. Also not realising what roles/people we needed until it was too late and had slowed us down.
Scale-ups need to hire for skills needs now and skills need in the future. They need to ask – ‘does everyone have the appetite for rapid change and the capability of moving into more specialist roles?’
Monika: One that not many people talk about is the entrepreneur’s ability to switch gears from a startup way of working to a scale up. In a larger company, you’ve got funding and a team, so you need to be able to successfully lead, inspire and delegate well. You need to see the bigger picture and not focus on the details of how things are done.
Nic: Interestingly, scale-ups do share some of the same problems as startups with their feature selection process. Making sure you’re building the right features is not something you can solve by throwing money at it. In fact – more money equals more means, and with that, the possibility of building all the features you can.
Secondly, if they grow fast, scale-ups will face infrastructure blockers. If they’ve started out with an under-provisioned
So what do successful scale-ups have in common?
Briony: Scaleup companies straddle a wide range of sectors and industries and it’s hard to make generalisations without sounding too generic.
I’d say that the scaleup companies I encounter that are most successful have fantastic leadership, a great board and trusted advisors, an appetite for learning and an ease with failure.
‘Successful scale-up founders are mature in their way of thinking, know when to step away, and surround themselves with people more experienced than themselves.’
– Monika Radclyffe
Monika: Successful scale-up founders and CEOs are mature in their way of thinking, know when to step away, and surround themselves with people more experienced than themselves. They clearly see and communicate the long term vision internally and externally.
Nic: We’ve seen a few different strategies put in place but so far this is what I’ve noted:
They aren’t scared of rebuilding their startups to grow. Maybe they built their software on the cheap and need to redo it completely. Or maybe their hosting/infrastructure solution isn’t fit for purpose and they need to move everything over, like our client Patternbank.
They’re also open to bringing in external technical help when their CTO decides they need to move fast. Wether that’s to build something onto their core product (like Gap Medics) or to let their team focus on the core product and seek help for side projects (like TRX).
And what’s your best tip for a founder attempting to scale up?
Monika: Build an effective board! Find an experienced chairperson who can help you build a proper governance structure. CEOs tend to look for chairpeople with lots of contacts or ability to invest, but really what you want from the chairperson is the ability to take you to the next level of scale.
‘Going for scale up investment is an all-encompassing activity, which will only accelerate once the money arrives, so it is really important to do it on a strong foundation.’
– Becky Sage
Becky: Sometimes slowing down is the best way to prepare to launch. Going for scale up investment is an all-encompassing activity, which will only accelerate once the money arrives, so it is really important to do it on a strong foundation.
This includes ensuring that: the team is all on the same page and in a good physical, emotional and mental place; the business identity is clear and that there are good customer use cases to support that you are what you say you are; the technical architecture is scalable, and that the product roadmap is clearly communicated and realistic.
Briony: Focus on what’s working, and become comfortable with letting go so your team can flourish.
Greg: Don’t forget to over-communicate what needs doing and why you are doing them. Things move so quickly in scale-ups that poor communication and frustration can creep in.
Thanks! Lastly – what are you looking forward to about D/B/M Growing Startups?
Greg: I’m looking forward to connecting with people with like-minded interests in culture and talent. Hopefully our experiences can help others not make the same errors.
Nic: From a management, finance and even tech point of view, there are so many ways to grow. I’m really looking forward to hear how others are doing it and see what we can learn and apply within CookiesHQ.
‘I’m looking forward to drawing out a good debate and discussion, and bringing the scale up journey (and all the support that’s available) to life.’
– Briony Phillips
Becky: I’m looking forward to exploring the idea that growth is not a linear journey – at some points on that journey you may even shrink in order to grow in the future.
I’m also interested to explore the different definitions of growth – revenue, profit, team size, impact, customer numbers, press/digital marketing stats are the metrics that are most easy to measure[…].
Briony: As host for the event, I’m looking forward to drawing out a good debate and discussion, and bringing the scale up journey (and all the support that’s available) to life.
Design/Build/Market is a quarterly event for anyone who is passionate about design, development and marketing. We bring people together to collaborate through combined knowledge.
The next D/B/M is ‘Growing Startups’ on the 18th July.
Join Briony, Becky, Greg and Nic (as well as other expert panellists) at the Engine Shed from 6.30pm, as they discuss how to future-proof your product, secure funding to take you to the next level, and build a team that smashes goals.
We’re down to the last 20 tickets, so grab yours now!