The ability and ambition to rapidly scale and expand globally is what sets startups apart from lifestyle businesses.
But just being a tech startup doesn’t mean this will be an easy and pain-free process. It’s something that takes a lot of expertise, skill and precision.
According to Dr Jana Matthews, an international startup expert, ANZ Chair in Business Growth, StartupAUS board member, and director at the Centre for Business Growth at the University of South Australia, there are some secrets that’ll help all types of startups successful scale their business.
The product always comes first
While startups can often get bogged down in the fine technicalities of running their business or in marketing and advertising, Matthews says it always comes down to the product or service above all else. If you don’t have a product that meets a demand, your startup won’t be able to scale.
“You can’t grow if you don’t have customers that love your product,” she says.
“That’s the first time you have an opportunity to scale, when you see an increase in sales, or another company where sales are increasing, and customers are saying they want more of it.
“If you’re going to scale you have to have a really great idea, a concept for a product or service that solves a problem that a lot of people care about. You really can’t scale if it’s some local problem you’re solving. It’s about having the ability to sort through and find that great idea.”
Set out clear company values and visions
A vision for the startup, along with a set of values about how to achieve this and run the company, need to be in place before the business begins to rapidly scale, Matthews says. These can help keep things transparent and clear to employees and customers, and can be applied to virtually all aspects of a startup.
“You need a really clear vision for the company and what you want to build, with values you can clearly articulate. You have to say: ‘what are the values that define how we operate? What are we looking for in people? How do we translate that?” she says
“The values have to be customer-focused. They guide how people behave and the questions you ask in the interview process.”
Make sure your employees know about these
This vision and the associated values are useless if your employees don’t fully understand them.
“It’s very hard for people to look at someone’s performance and say, ‘you’re not performing the way you could or the way I’m expecting you to’,” Matthews says.
“But people aren’t clear about the expectations, and you need to be sure they know before you pull the trigger. One of the mistakes entrepreneurs make is that they think it, so they assume everyone thinks it.
“You have to have leaders that can communicate and articulate so they can describe to customers why this product is great and to prospective employees about why they should join the company. They need to understand what the growth journey is, and that it’s not just super-sizing whatever you’re doing.”
The CEO has to grow with the startup
As the startup begins to rapidly grow and develop, so too must the CEO.
Matthews uses an analogy to illustrate this, comparing how a parent treats a newborn to how they interact with a teenager.
“There is a set of responsibilities the CEO has all the way through, but the roles will change,” she says.
“You need to change from making all the decisions yourself and hiring people who will do what you tell them, to hiring people you can delegate to. Original people can switch into that role, but some of them are waiting to be told what to do, and you cannot grow with that.
“Some CEOs are in the business, not working on the business. You need to stop working in the business and get out of it to work on the business. If you continue to be in the business then you actually become the bottleneck to growth.”
Don’t grow until you know everything about your customers
Startups shouldn’t be looking to grow until they have customers that they understand completely, and have the revenue required to bring on new employees.
“If you want to scale you have got to be in close contact with your customers,” Matthews says.
“You have to listen to them and ask them, to actually go out and talk with them. Then you have to step back and ask if you’re delivering that.”
Dr Jana Matthews will be hosting an event for female entrepreneurs, organised by Startup Victoria’s Female Founders program, in Melbourne this Thursday – Scale essentials of a high growth startup.