The standard ‘schools’ of business leadership don’t cut it for Scale Ups: they lack the practical guidance and tools required to address the specific leadership challenges unique to Scale Ups.
Yesterday I shared the primary danger facing successful start-ups: getting stuck in No Man’s Land by failing to adapt the way you run the business as it scales. The good news is, when you know what to look out for, you can take the sneaky little left turn onto the Path to Scale and escape that depressing ‘Swamp of Stuckness’ which awaits every unwitting entrepreneur in No Man’s Land.
The Scaling Up knowledge vacuum
When your job is scaling businesses, as ours is, you’re confronted with the relative vacuum of practical guidance and tools on how to Scale Up a business.
Business schools have done well to school vast cohorts of big business managers. Management barely existed as a practice or vocation just 100 years ago. But in the 20th century, Peter Drucker, Jim Collins and others codified the art and science of big business leadership and business schools around the world have duly indoctrinated legions of corporate managers.
But they left start-ups founders and funders groping in the dark for principles of effective start-up Leadership.
Then Silicon Valley industrialised the process of starting a business over the last 40 years. The last 20 years have seen Business Schools gradually add these lessons to their repertoire.
But between these worlds of zero and hero has lurked a significant vacuum of ‘science’.
Between successfully starting up and becoming an established force to reckon with comes the arduous task of Scaling Up – building an informal, lean and mean venture into a world class organisation that wins at scale. Navigating ‘The Path to Scale’ has largely been a dark art, with few known and proven methods that consistently get results.
Of course the universal principles for building a great company (“Built to Last”) all apply to Scale Ups, just like the same things that make adults better people apply to teenagers too. But they don’t provide specific enough guidance on how to build an organisation that is “Built to Last”, from small. For example: what do you do when your start-up management team is out of their depth? When do you start hiring executive level leaders? When cash is limited, which roles do you upgrade first? How do you afford experienced leaders? How do you honour and retain a loyal start-up team that’s not ready to take their function to the next level? How do you avoid destroying culture through leadership changes?
To return to the adult / teenager analogy: world class traditional management literature may help you be a better adult, but it doesn’t help you survive being a teenager. Teenagers have countless hurdles to clear (like passing school, or getting a driver’s license) that adults have long forgotten. If you don’t clear them, adulthood will be awful. But classical leadership and management literature and schools fail to provide teenage businesses with practical guidance to clear the many specific, tough hurdles unique to teenage stage businesses.
This vacuum of science was a real problem for us. Scaling Up is both the hardest part of building great businesses (in our experience), and also our job! We had to close the gap. So we started watching, and studying.
We spent the last few years watching what works. After all, we have front row seats. As venture funders, we’ve evaluated thousands of ventures over the years and we’ve invested and walked the road with many entrepreneurial teams. We’re also entrepreneurs who’ve been scaling our own business for 8 years. So we see the world of Scaling Up from many angles, including from the inside. So we’ve watched: what do the successful Scale Ups do that unsuccessful ones don’t?
Scale Up science emerging
We’ve also scoured the globe for the cutting edge of ‘canned know-how’ on Scaling Up. Slowly but surely, more is emerging. 10X CEO studied >14,000 VC funding rounds to discern the differences between companies that scale, and those that don’t. Stanford now has a 6-week executive programme focused on Scale Ups. All this is brand new in the world of leadership know-how (the last 5 years).
Our findings from ‘watching’ agree with what the global gurus are saying about what drives successful Scale Ups. There is a Science to Scaling Up (to add to the obvious art). It is observable. It is repeatable. And best of all, it is learnable.
That’s great news because it means you can exponentially increase your chances of success if you learn and apply The Science of Scaling Up.
So in our next post, we’ll start unpacking ‘The Science of Scaling Up’.