Startup to scaleup: overcoming growth pains - Part 3

17 Jul 2019
As part of London Tech Week 2019, we invited a panel of established entrepreneurs and investors to discuss the top five barriers to scaling up a startup. Previously we covered access to markets and finding the right finance. Our final blog post will share more of the panel’s experiences of how to overcome growth pains as you’re scaling up:

 

5.       Infrastructure

As you start to scale up, your focus as a leader becomes less about your product and physical assets, and more about the running of your organisation. David Gammon says, “too often great engineers focus so much on their technology that they forget the vital importance of the organisation. You need to put as much time and resource into your organisation as you do into your R&D and marketing.”

  •  Ensure you set up work systems place from the very beginning. Irene says, “Put IT and CRM systems in place even if you think you are a small company.” Then you’ll have the foundations in place to withstand rapid growth when you’re scaling up. Think about your HR team, and your processes for recruitment and retention, as this will carry you through while your company progresses.
  •  Choose your advisory board wisely.  A big part of what dictates your infrastructure is your advisory board, and the guidance you need at startup level will be very different to the guidance you need at scaleup level. David Gammon says, “Boards members must grow with the business and should be replaced when needed for fresh new ways of thinking.”
  •  Consider what metrics you are using to measure growth. Michael Hill says, “Financial metrics are not normally the primary KPIs for an investor. What’s more important are softer KPIs like type of profile of customers, shape and capability of the team, the number of client interactions and meetings, it’s those sorts of softer metrics that you should put in place because the revenues are harder to predict.”
  • Consider the physical location of your startup. Some places are naturally better placed to sustain a business because of the nexus of support and finance provided locally, there may be connections to universities and more opportunities for corporate collaborations in the area.

Any other business?

  • Make you sure market your product well. Poppy Gustafsson says, “you need to be able to articulate what your product is to the customer so that they understand straight away. Being able to convey this in a relevant way is important.”
  • Understand how your product will be used in a customer environment. Michael Hill says, “Often teams don’t understand how their products will be used in a user setting, you will only know this once you see it in action within a user setting. Once you get that engagement, it allows for accelerated product development.”
  • Don’t make assumptions! Poppy Gustafsson says “It’s easy to assume you’re a disruptive innovator who’s doing things differently, but we still inherit some assumptions that things are always done a certain way. Everyone does demos that last three months, so Darktrace did demos for three months too, in the customer environment. Didn’t need to because the product is quick to install! We changed it to three-week demos, and product acceleration happened quicker as a result.”

 So what next?

Are you a startup that wants to scaleup? Our six-month SME Leaders programme is specifically targeted at equipping ambitious leaders with the skills they need to take their business to the next level.  The Enterprise Hub offers mentoring and one-to-one personal development coaching to help entrepreneurs as they wrestle with challenges in their business, as well as a financial grant for extra training courses. You will also receive a lifetime membership to our Enterprise Hub community, which gives you access to workshops, networking opportunities and other support.

Sound good? See here for more information and for when applications are open: https://enterprisehub.raeng.org.uk/programmes/sme-leaders-programme/

 

 

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