Recently, a new business owner asked: “How do I scale a new business?”
Here’s our answer to that:
A brand new business shouldn’t focus on scaling just yet. It’s only once you have some traction, growth, and product-market fit should you focus on scaling. Scaling and growing are two different things. Early stage companies are still trying to figure out who their customers are and how to consistently acquire them. The focus is different for a scaling company that already has product-market fit. When you’re in the pursuit of product-market fit, all bets are off—Changing teams, markets, products, names, and visions are all reasonable actions to reach product-marketing fit (also known as PMF). When you’re scaling, you already have all of that figured out and whatever you’re selling is flying off the shelves and customers are lined up to buy what you’re selling.
We have discussed the meaning of scalability in a previous post here.
To clarify, to scale:
- You need standardizations and processes
- You need automation/technology
- You need to create efficiencies to allow scalability
Scaling is not just growth as scaling requires you also control the costs of growth. Sometimes people “grow” themselves out of business because they were not scaling. As mentioned, when you’re ready to scale customers are buying your product as fast as you can make it. It’s only reasonable that you get your operations in order to handle the influx of business because if you’ve done things right, this is only the beginning of your business growth.
Here are some starting points to address for growing your business that can then lead to scaling:
- Who are your competitors and why would your customers choose you over them?
- Who do you plan to serve and who will you say no to? Get clear on your lane and the strategy you are pursuing.
- What is your competitive advantage? What you do better than anyone else?
When you know these things and have achieved PMF, design your organization with scalable processes that are repeatable, organized, and efficient and make sure you have the right people doing the right work and you’ll be set to scale your business.
Need help scaling your business? Reach out to us for help.