Updated: Dec 18, 2020
Achieving scalability continues to be one of the biggest challenges facing companies today. Many companies successful startup and then grow revenue, only to stall in the dreaded $2M - $5M revenue range. Several factors account for this stalling, including: initially addressing a small market segment (often regional or a niche), poor initial business models, inexperienced leadership and lack of growth capital. If a business stalls here, it can descend into a ground war of tough slogging, gasping for capital and unable to execute on the strategic initiatives necessary to scale, or adopt a growth strategy, scale and then dominate the sector. It is truly a fork in the road!
In some ways the scale up is more difficult than a startup phase of a company. For instance, a scale up requires a constant supply of working capital not just initial capital, it needs to fend off established competitors that come with larger market segments, it requires management that is experienced and positioned for the next level (usually 10x), and ultimately it needs a business model that works ac