Some interesting thoughts on what it takes to scale and grow a $100m+ business. This is a write up up of some of the key learnings from last year’s Silicon Valley Comes to the UK visit.
A good 9 point check list thought the most important one of all is missing…
- Choose a big enough problem to give yourself room to grow
- Embed yourself in the right networks to benefit from advice and connections of people who will understand the challenges you will face.
- Recruit people who have done it before because many of the problems encountered while scaling are common across organisations.
- Hire for tomorrow, not today because in a high-growth organisation your needs will change extremely rapidly.
- Embrace diversity to broaden the number of problem-solving approaches within your team.
- Nurture company culture and values as you grow to avoid losing a sense of mission and identity.
- Build systems that scale – from technical infrastructure and data systems to organisational processes.
- Test continuously to stay close to the customer – new techniques are needed when you can no longer meet all of your customers individually.
- Take the right kind of money at the right time and avoid making fundraising an end in itself.
And the missing point in our view?
- Be lucky.
It is very tempting to think that building a big ass software business is a formulaic, resource intensive process but we tend to forget the losers, the ones that don’t make it when we look back to identify patterns. For every Facebook, there is a handful of Bebos and Myspaces (i.e. similar, meme type businesses with ultimately shaky, long term sustainability that fluked a great exit for the founders), a vast number of venture and angel funded businesses that went nowhere and ended up getting sold to another hopeful startup (BlockChalk – sold to Klout for example), a ton that got some funding and went precisely nowhere and probably ten times that number of startups with similar ideas that didn’t even get beyond the funding stage.
I’m not saying that in this example, all of the startups had identical conditions and the one thing that set Mark Zuckerberg apart was luck, but I don;t think you can overlook the importance of luck, and lucky breaks, in building a big company.