The fundamentals to growth: good growth vs bad growth, the endless pivot, measuring the wrong thing – it is time to face the fact good growth is the ultimate challenge & demands more thinking about business models & strategies of the past.
Too often, scale-ups neglect proven strategic models in favour of endless pivoting.
At Founders Network this week Gianluca D’agostino challenged a table of founders to question why so many dismiss the business they created in an endless quest to raise capital. Focus has been deflected from Porter’s 5 Forces, Blue Ocean Strategy & the models embedded within the inception of many businesses. These concepts are now lost. The dismissal of ambition to utilize strategic models results in businesses being stunted by the refusal to answer the tough questions.
A belief in both models was appointed imperative by Gianluca. The lean startup ethos and agility to pivot will flourish when applied the backbone of true strategy and focus, enforcing constant depth of thinking and problem-solving. Start-up models like this were formed for development, and must be injected with surgically sharp strategy and pointed execution. You are building a tower and these models, this clarity, they are the foundation.
1. The core business is the business.
Your business is never raising capital. It will take 6 months longer than you think, so plan it. Don’t divert your focus from running the business. If you are dead before success, you are dead. No-one will remember that you were 8 weeks away from your Series A.
2. The business model is the only survival kit for the business, so challenge it.
You can’t be certain that something is undefeatable if it has never been challenged. Interrogate how you make money. Identify your business model by challenging it against alternatives. What assumptions is it based upon? Challenging your assumptions should be in your plan from day 1.
3. What are the systems, processes & team that you need to deliver against the chosen business model?
Are they in place? Your business is a sailing boat: you are nimble & can move at speed, but cannot become unstuck. It is vital to understand what everyone around you is looking for. Ensure clarity of thinking from the outset, and then execute.
It was a wonderful way to start the week – to openly question each other & ourselves.