Do’s and dont’s of rapid scaling for startups

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Every startup business comes to that crossroad where they need to decide whether it is the growth they are aiming for or scaling. Scaling a business is really an exciting opportunity to reach new customers and unlock new revenue streams but it is also a journey that is challenging and filled with accidental pitfalls. Whether business owners are on a trajectory to build up their team or expand their business to a new market, there are certain do’s and don’ts of rapid scaling for startups to be kept in mind.

Respect Cognitive Load: One of the best ways in which you can respect the challenge of cognitive load and get rid of complexity is to keep teams small and nimble. There is plenty of evidence that suggests that if a team grows beyond five and gets closer to ten, more time is spent on coordination chores and less time on actually doing the work. In addition, you might find yourself having to track the personalities and moods of ten or more employees and this can be a daunting task. Understanding each employee and finding that hidden talent, identifying their strengths and weaknesses in order to use them productively is imperative. But in the meantime, it is hard work figuring that out. In such a situation, it is advisable to keep things simple.

The right mindset for the right time: When your startup makes an entry into the growth stage you might want to ensure that you are not just thinking about the numbers, the customers, users, and headcounts. It is important to have the right mindset for development and you have to make sure that the people you are working with are ready for this change and on the same page as you. Startups are especially susceptible to mindset mistakes; when they see that things are working well in this stage, they try to hold onto that feeling, all the while taking on new clients at breakneck speed.

Go slow: One of the things about scaling for startups is knowing when to hit the brakes and slow down only so you can pick up speed and scale faster later – when the time is right. Unfortunately, there is no right route to scaling. It is different for each company. What is also important is getting others to buy into your mindset and using social media platforms such as Facebook helps a great deal.  Sometimes this results in moving too fast and this could be disastrous for the company. For example, when building software for nuclear machines, everything has to be right and the “build fast and break things” formula doesn’t really fit here. Devotion to precision is what is needed in order to help a company scale.

Expect Accountability: One of the things about rapid scaling for startups is to be able to identify your pockets of excellence with regard to performance, attitude, and execution and spread them throughout your organization. Making people accountable for the success of your startup’s growth is probably the best way to do that. In such a workplace, colleagues work together and aren’t afraid to let each other know when they are going wrong because the organization has infused employees with a commitment to high standards, reinforced by critique and constructive feedback.

Subtract as you add: For some people, scaling for startups is all about more – more employees, more customers, more revenue, more processes, and more tiers of management. This can often mask what you are losing, what you should lose, and how it impacts the business. However, there are a lot of things that used to work but don’t work anymore so it is important to get rid of them. There are some things that might have slowed you down without you even realizing it. It is time to throw them out. While keeping an eye on the additions, you have to be aware of necessary subtractions as well. A good example of this is performance evaluations. The number of hours lost to performance evaluations in large organizations is immense and would be totally unjustifiable in a startup.

Hot causes and cool solutions: In order to change human behavior it is necessary to get them enthusiastic about a ‘hot cause’ and then link that to a set of ‘cool solutions’. A hot cause is a set of problems that people will be passionate about. In order to scale successfully and keep people enthusiastic about their jobs, it is important to do enough internal marketing and remind them that they should be invested in their jobs and passionate about them too.

Move forward: If people don’t like the direction you want them to go in or they don’t believe you, keep them going no matter what and their beliefs will change. Moving forward is an integral part of scaling.

As a founder, you have every opportunity to remove roadblocks so that pockets of excellence can spread. When you envision scaling for startups this way, it works.

CoffeMug.ai is an AI-powered networking platform outfitted with a highly qualified team of analysts, incubators, accelerators, and mentors with varied backgrounds. With the help of an immeasurable global network and resources, CoffeMug.ai has profitably managed to support a number of startups through manifold rounds of funding, adding considerable value at each stage. 

FAQs

Q. What is a scalable startup?

A. A scalable startup takes an innovative idea and looks for a scalable business model to turn it into a lucrative, high-growth firm. It accomplishes this by either entering a huge market and capturing market share from competitors, or by developing a new market and rapidly increasing it.

Q. How do you effectively scale a business?

A. First, evaluate your company’s internal operations to analyze if it is ready for expansion, then start looking for funds, invest in technologies, and hire employees or outsource your projects. 

Q. What are the keys to scaling for startups?

A. Commitment to growth, developing a comprehensive managerial skill set, building partnerships, establishing standard procedures, identifying core competence, and demonstrating competitive edge are some of the key elements needed to scale a business. 

Q. How do you know if a company is scalable?

A. The concept of scaling a business is relatively simple, whether your operating costs are high or low. If you can significantly increase your customer base without increasing your fixed costs, then your business is said to be scalable and profitable. 

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