10x your innovation results in a week

Years ago, I started working with a company just as a private equity firm bought it. Based on the trajectory of the clients category, their revenue outlook and EBITDA, the firm overpaid by an order of magnitude. But they weren't there to cut costs, improve margins and flip it. Instead, they believed that the brand had enormous untapped potential for growth beyond its core business model, and the belief amongst the partners was that when this future potential was taken into account, they'd bagged a bargain.

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Over the next 12 months, acutely aware of the time pressures facing them and the promises they'd made to their own investors, the firm bombarded the company's venture team, who were tasked with unlocking this growth, with links to consumer research, ideas for new products and services and startup pitch decks. It got so chaotic that we appointed someone on the staff to handle the amount of inbound communications, sift through it and summarise it for the team.?

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We spent that year serving our new paymasters by talking to thousands of customers, exploring hundreds of ideas, and sitting through dozens of startup pitches, and we launched nothing. We were:

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• Directionless: Overloaded with so many potential leads for growth that appeared attractive at first glance, we didn't want to discount any of them, so we went off in countless directions trying to explore them all.?
• Overwhelmed: The private equity firm had backed and invested in the venture factory, and they made it clear just how critical our work was to driving imagined future returns. We didn't want to let anybody down.?
• Thinly Spread: Despite the investment in the team, there were still only twelve of us (3x entrepreneurs in residence, 3x researchers, 3x designers and 3x engineers), and we couldn't get to everything. ?

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Something had to change for the good of the team, the investment and the business more broadly. We needed direction, focus and a north star to work to.

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Being investors, we knew that the PE firm would be familiar with the concept of an investment thesis - they had one that specified the types of companies and markets they invest in. While it was pretty meta, we felt we needed one too to set out our point of view on the future, our strategic objectives and create a coherent narrative for where growth will come from today and tomorrow. So, we shut ourselves away for a week before a scheduled meeting with them to develop what later became known as our Growth Thesis.?

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• On Monday, we mapped the current value proposition and business model of the company to understand which revenue streams were in decline.
• On Tuesday, we did a deep dive into the market trends, industry forces and economic shifts driving this disruption and subsequent decline.?
• On Wednesday, we synthesised the trends, forces and shifts we'd identified into concise, single-sentence problem statements that everyone could comprehend.?
• On Thursday, we prioritised three of the 20 problem statements and turned them into growth territories based on their imminence, our ability to play and potential payback periods.
• On Friday, we used those territories to create our growth thesis, a strategy for exploring growth territories and a plan for investing in identifying, developing and validating new propositions.

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The following Monday, we came back to the usual inboxes full of trend reports, ideas from the firm's partners and more press clippings on interesting startups - but we also came back with a renewed sense of focus, purpose and calm, and we walked them through:

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• The current business model
• Which value propositions are in decline
• Why they're in decline through the lens of interesting emerging trends, future technology and customer jobs
• What that meant in terms of threats, opportunities and arenas to compete in?
• How we felt the business could best capitalise
• Our three territories for growth in year one
• A vision for what the company would look like if we succeeded?

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They signed off the plan, and we reorganised our three teams, so they focused on a single growth territory for the year each.?

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Over the next 12 months, we identified 300+ new business, product and service opportunities, developed 100+ new propositions and tested around 20+ of them in the wild. We found product/market fit for 5 of them, and over the next three years, 2 of those propositions alone contributed to over 20% of the company's revenues.?

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We still got the emails, calls and texts - but they were helpful now rather than distracting, and they aligned with the growth thesis we'd signed off together.?

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If your innovation efforts in 2023 have felt haphazard, sporadic and random - do yourself a favour - lock yourself away for a week before 2024 hits. Assess what's going around your business and develop your own growth thesis. You'll deploy precious financial and human capital more efficiently, leverage the assets of your core business more effectively and generate much more helpful support for your efforts internally.?

For more advice, recommendations and support to bring you closer to a better approach to growth, join The Fold, our free membership community for corporate change-makers.