Empowering revenue generation
This is crucial for all growing companies whether B2B or B2C, and the fundamentals are knowing the customer, understanding sales channels and influencers and competitor strategies monitoring and planned response. In scale up, high quality recruitment, delegation and empowerment is a core skill to ensure the company still delivers to the same quality. Account management plans, sales management structure, incentivisation and performance management are all likely to be required for the first time and we can provide precedents and benchmarks for these.
“Winning new customers and retaining them is the key to scaling any business.”
James Bagan, Operating PartnerView Profile
Establishing the mission
Frogs’ definition of strategy: “A competitive game-plan to achieve an important goal” Particularly during the scale-up phase, where a degree of product market fit has already been established, strategy is not about selling a vague market opportunity but rather combining a clear view of addressable market with a robust plan of action as to how this can be exploited. More importantly, identifying the unique resources and attributes your company has (and will need) to thrive in that environment.
“As you scale a business it grows beyond senior management’s line of sight, so strategic intent is crucial from a communications perspective.”
David Williams, Operating PartnerView Profile
Building optimal teams
Talent is where planning and execution intersect. Good people will of course help you to execute better, but if they have the right quality and seniority they will also be involved in shaping strategy through bringing challenging views to planning sessions. We champion developing a culture, organisation and HR approach to nurture and continually assess talent at all levels. As a CEO, your optimal team for the challenge will change over the years. Recognising this fact is essential, as is having an approach to assessing performance, addressing competence gaps and spotting early the need to make a step change and take tough people decisions. A strong senior team is essential to share the burden of responsibility for seeing and delivering the vision that can otherwise become oppressive on the CEO.
“Attracting top talent is a critical ingredient to successfully scaling a business.”
Shirin Dehghan, Operating PartnerView Profile
At the early venture capital stage, investors base their judgement largely on high level instinct; the passion and experience of the founders, the size of the market and the innovation of the product approach. At the scale-up stage, the core judgement is whether there is the potential to create a longer term, sustainable and valuable business and to set realistic value creation benchmarks along the way. For small businesses, it will be rare for large purchasers to make an inbound approach unless you make a strategic decision to build your profile and relationships. For many corporates, a commercial relationship will be required before a transaction can be justified. Building multiple relationships keeps options open and gives the best, rounded insight on value creation.
“Value creation is an outcome of building a successful business, not an objective to be set in its own right.”
Mike Reid, Senior PartnerView Profile
Knowing your options
A successful scale-up will have lots of funding options. A company with few funding options is not likely to succeed. Scale-up company boards must have experience of and network into funding alternatives (internal and external equity rounds, venture debt, working capital facilities, its own customers and ultimately, profits), and should understand the company specific pros and cons of each. One of the most common mistakes is pitching your story too early to investors who say they are intrigued but don’t shift to being convinced. Thoroughly test the core thesis you are asking your audience to pitch to their investment committee. And thoroughly research their key investment criteria, as a debt provider, corporate investor, scale-up investor will all have very different measures.
“Funding requires a continual questioning of whether the current approach is fit for purpose for the journey ahead.”
Steven Dunne, Senior PartnerView Profile