The Principles of Scaling a Startup

Your dream of creating your own startup is finally coming to fruition. Whether you started in a garage (Apple) or a dorm room (Facebook), eventually, you will outgrow your humble beginnings. You will go from being a visionary with a dream to a CEO and co-founder who needs to think seriously about every aspect of your growing empire.?

Building a business from the ground up is no joke! So it’s no surprise that books and blog posts filled with advice abound. But where do you start? As the adage goes, “Start at the beginning.” As Harvard Business School’s Lauren Landry puts it, “By understanding what the common scaling challenges are, you can start to recognize patterns and avoid the issues most founders face as they grow their startup.” And your challenges are not unique — every growing company experiences similar challenges. According to Harvard Business Professor School Professor Jeffery Rayport, they can be broken down into the Six S Framework:

1. Staff — Growing your company requires the right people. “For resource-constrained startups, the right talent can change everything: High performers are 400 percent more productive than the average employee, according to McKinsey. As roles grow in complexity, that productivity number jumps to 800 percent.”
2. Shared values — Shifting from a founder-focused organization is key, driven by personal preferences and individual mantras. Creating a company culture requires you to de-center yourself and build shared values rather than individual beliefs.
3. Structure — We’ve already discussed this in detail, but Harvard’s Landry has some sage advice worth heeding: “As the company grows, so, too, should the number of decision-makers. The founders can’t be involved in every detail of the business once it scales.” Keep this in mind when choosing and building an organizational structure.
4. Speed — You have a product; now it’s time to be realistic about how fast you can grow. That will be determined — at least in part — by your product. If you have a complicated supply chain and manufacturing process, your ability to grow may be more limited than that of, say, a mobile app.
5. Scope — Growth isn’t all about production; it’s also about scope. What new geographies can you target? Are you going to offer new products or services? These are all decisions you will have to make as you scale — but if you plan, the decisions will be easier when the time comes.?
6. Series X — Financing is a constant concern for growing businesses — and you need to align your financing with your growth plans. From the way your overhead impacts your flexibility to whether or not you can grow your workforce, financing is at the heart of all these business decisions.??

To grow sustainably, founders need to think ahead, anticipate the decisions coming their way, and be prepared to answer them quickly and efficiently.

A little bit of future planning can ensure smooth growth and avoid unnecessary headaches. If you sit down with this list and your team to discuss these details now, you will be poised for growth — and ready to answer any questions potential investors throw your way.?

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