How to build a fast growing business: 3 big ideas

How to build a fast growing business: 3 big ideas

Keyhan, Krippendorf is a strategic consultant to companies such as Microsoft and Johnson & Johnson, author of Outthink the Competition.

 

I couldn’t believe my eyes. Before me was the inscription – white letters on a plain black plate – Xerox PARC. The place where was born the mouse, GUI, Ethernet, and laser printer. In a few blocks from Stanford University, the birthplace of Yahoo, Google and many other companies that changed the world.

 

I spent the day with a group of brilliant managers of fast-growing technology company that already went to the exchange and had a turnover of several billion dollars per year. That evening I had dinner with an old friend, which creates a technological firm. It is already profitable, but its turnover is a few million a year, and it’s only becoming. And the week before I interviewed the CEO of another company – Bigcommerce, – which employs 200 employees and which serves 30,000 clients.

 

Look at these three trajectories – a startup fast growing company of medium size and global corporations with billions in turnover, and you’ll see a pattern: three unexpected answer to the question, how do you build a fast growing business. Three steps to do something really big.

 

Start now, plan will then

 

Venture capitalists and professors of business schools are advised to carefully assess the market potential before starting to build your business. They talk about the size of the market, on the point of return to profitability and demand study. Although this is a logical tip, and large companies follow it, successful startups seem to do the opposite: start, and then assess potential.

 

Copier Xerox was invented by a lawyer who was tired of retyping documents. He rented a room, which experimented with the technology copy. Virgin is also was born without a business plan, and Richard Branson continues to repeat this “mistake”, achieving great success.

 

Bigcommerce was created long before the founders realized the potential of their market. Its creators, Eddie Makalani and Mitchell Harper, told me that they just started writing little programs that help companies to manage online sales. And only then, then they have already started to attract some money, they carried out simple calculations and realized that their market has the potential to create big business.

 

As they said, “many people are immersed in the writing of business plans. It’s not working. You just need to dive into the market and achieve something. And once that happens, you will begin to open the door.” They are looking for exactly the kind of attitude in the people you hire.

 

Spit on formal processes – it is better to find a problem worth solving. Start creating the solution. Take care of business. Then you will worry where you will get the decision.

 

I thought through a detailed plan of development of one software solution – finding funding, finding suitable developers. But in the next two months I have to conduct projects in four major companies. Instead of waiting until everything goes perfectly, I should immediately develop a few more simple tools and put them to their customers on the page password protected. It will cost me $1000 and several days of work. But I know that when people see what these simple tools, “doors will open”.

 

Chase the impossible

 

When the guys at Bigcommerce have calculated the size of their market, they realized that flying too low. “We just felt something and realized – without much confidence – that it can cost a billion. Before our goal was to build a company worth $100 million.”

 

My friend recently created a startup experienced something similar: once the company began work, they discovered that in front of something much bigger than they thought.

 

It’s time to set myself and my team like an impossible goal, otherwise you can get stuck in the trap of self-fulfilling prophecy. Great ideas always seem impossible at first, and if you don’t start thinking big, until you find a solution – you simply will not look for a solution. As Einstein said, if at first the idea does not seem absurd, then it is hopeless.

 

“Get used to this figure of $1 billion we could not immediately,” he told me Eddie and Mitchell. But until you set a goal that you are really scared, which cannot be achieved with your current course of action and business plan, you, by definition, there is no need to try something new.

 

Impossible goal creates clarity. For example, Eddie and Mitchell immediately saw the need to rebrand the business and to process product to set up and a layman.

 

Do you have an impossible goal? How do you respond to its impracticability? You stay away from the impossible or see it as the inevitable birth of something big?

 

This week I allocated three hours to understand what an impossible task you set for ourselves. And you too will take the time to do. Think about something impossible you have created.

 

Build organization per 10-fold increase

 

Bigcommerce is not the first successful company, and managers tell me about the principle of “Multiply by 10”. Imagine that tomorrow your organization will need to give 10 times more than today. If you sell $500,000 a year, imagine that you need to sell $5 million If you produce 400 gadgets, imagine that it is necessary to produce 4000. And then ask yourself the question: “if we Allow to do our current structure? If not, then we need to change?” This exercise shows you where your organization’s point of the fault.

 

There is a proven model for the analysis of such points – you need to match between the four aspects of business: the tasks the company must perform; people who carry out these tasks; the formal organizational structure; informal practices (culture). Paying attention to these four aspects and analyzed their relationship, you will find that you need to change to prepare for a 10-fold increase.

 

Bigcommerce, for example, found that changes are needed on three of the four dimensions:

 

Tasks: Company needs to sell and develop their products, support customers and attract new ones. This must be done at the global level and systematically, while maintaining an entrepreneurial spirit. And this setting will determine what people, what culture and what is the structure of your company.

 

People: To become 10 times more Bigcommerce had to rebuild the team. They hired an experienced Finance Director, able to take the company to the stock exchange and attract new capital.

 

Culture: the Company clarified its core values and began to hire and fire people based on how they are close to these values.

 

Formal structure: Bigcommerce has turned his team into 12 mini-startups to maintain agility and mobility. The management team remains in Australia, while all sales and marketing happen in the United States (and from there the company gets 70% of their income). This choice initially sets the company on a global course of action that allows you to quickly move into new markets (they know how to run a business remotely), and in addition, provides entrepreneurs-the founders who “always wants to do something else” to distract the team from the main case. “It helps not to complicate things,” said Eddie.

 

Imagine your company 10 times more. Ask yourself where it the point of the fault and what unique features you would like to see it in four areas:

 

1. Tasks performed by your people

 

2. The people themselves who work in the company

 

3. Your formal structure

 

4. Your informal structure and culture

 

These three principles – to start work immediately, to strive for the impossible, multiply by 10 – lay the Foundation for impressive growth. Bigcommerce for the year grew from 50 employees to 200, the development team grew from 7 people to 70, and now the company serves more than 30,000 clients.

 

How to build a fast growing business: 3 big ideas

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