There is an abundance of material on the internet providing all sorts of help and resources to founders for their big idea. They mainly deal with the starting-up side of a startup. But that being done, a startup at a certain point in time also needs to scale their business into something larger – sometimes much larger – than what they had started out as.
Scaling is a crucial moment in the history of a startup. In fact, it is so vital that many deem it make-or-break. If you scale too fast, you will end up with loads of problems with your organization that will be hard to resolve. If you take the slow approach, you risk losing out on lucrative opportunities that generally accompany increased revenue and availability of resources. No need to be in two minds about scaling, however. The following tips should safely see you home.
Ascertain if your business is scaleable
So, you have an outstanding product that solves a real problem. But that does not necessarily mean that your business needs to be scaled. Exercise honesty in this and assess whether scaling is really worth the resources it will consume. Often times, you are better off as a lean, mean, small-albeit-successful business. Family businesses, for example, are typically small and successful, and constitute 90 percent of all small businesses. Your strategy will determine your decision in this respect.
Keep the following things in mind while scaling
Before you decide to execute your scaling plans, take time to figure out what your core products are, who your base customers are, and what marketing channels will help you propel things to the next level. A study of over 3,200 startups revealed that 74 percent of them failed for being too hasty in scaling up. Before you decide to scale, answer the following questions:
Do you have a minimum viable product that fits the market?
Have you ascertained who your basic customers are?
Are you aware of the marketing channels that provide the best return on investment?
Is your funding sufficient to tide over tough times?
A "no" to any of these questions means you have to sit down and rethink.
Embrace automation and outsourcing
According to some top experts, labor-intensive startups are difficult to scale. Streamline all of your processes by any means. This streamlining includes creating training materials for new hires, automating billing and payroll, automating the marketing that you do, etc. In the absence of opportunities for automation, go for outsourcing. Allocate most of your resources to work at scale at your core product or service. Ensure that only the most essential of functions are performed in-house, and for everything else like copywriting, design, legalities, and office maintenance, employ external contractors. After the scaling dust has settled down somewhat, you can bring back these roles into your core fold.
Make yourself dispensable
Do not take this the wrong way, but ideally, your business should be simple enough and streamlined enough to chug along smoothly even if you are not there and someone else is at the helm. The business process needs to be easily understandable and repeated with much effort. No aspect of your business should be fragile enough for bad employees to bring down. Many make the mistake of assuming that all marketing teams will perform the same. They rarely do, and initial growth and magic often escape more mature organizations.
Avoid going overboard
Be careful when you hire, spend and build during your scaling up phase. While making hires, keep in mind the adage of being lean, even while scaling. Do not absorb too many people in your workforce or team. These cost you in your core competency. You end up hastily scaling up the other areas. Keep tabs on your spending – often, we see startups throw away much cash after raising a good sum while raising funds. Stay focused on growth while keeping spending in check. And do not build too much. You have a good product-market fit and are scaling up with your main product as the base. No need to go haywire with related products or features. Achieve perfection in something while venturing out to build something else.
Remember these last words
Scalability is, in itself ,a mindset. It needs to have the people as well as the systems in proper order to facilitate your growth.