There are millions of businesses in the UK, yet little over 30,000 can call themselves scaleups. These are the companies that are growing rapidly – by more than 20 per cent in revenue or headcount for three consecutive years – and they are now receiving special attention from the government, thanks to their wealth and job-creating potential.
Anyone who starts their own business is by nature ambitious. However, ambition does not necessarily translate into a clear strategy and roadmap to achieve significant growth.
While there’s no magic formula, there are a few key lessons that others can take from existing scaleups.
Work out your funding requirements early on
When seeking finance, timing is key. Often, businesses leave this to the last minute. Even if it does lead to funding, it will probably require handing over more equity or taking on a higher loan interest rate than
was desired. Start early, and pick wisely. A scalable business is attractive to investors, and the right partnership can provide credibility, strategic support, and connectivity.
Embrace tech and innovate
In our recently published report, “Dream bigger: The scaleup moment”, 50 per cent of the scaleups we spoke to claimed that advances in tech had been critical to their expansion. Among slower-growth firms, this fell to just 18 per cent.
High-growth companies also placed far more emphasis on having an innovative business strategy. There is a clear link between companies which achieve high growth and those that embrace tech and innovation, and entrepreneurs must apply this logic to their business wherever possible.
Professionalise your firm
Many of today’s high-growth businesses are market disruptors.
However, to continue their growth trajectory, they all had to professionalise at some point. This is about establishing a clear business strategy, implementing the right processes, and building a dream team that can take the company to the next level. Once you’ve established this team, all should be part of the growth journey and have an opportunity to work on the business, as well as in it.
When everyone is working towards a common goal, things tend to move a lot quicker.
Venture into new markets
Looking beyond the natural borders of your business, in terms of both sector and location, can be key to achieving higher growth. It’s not surprising that two in five scaleups claim that venturing into new markets was the turning point that led to rapid expansion.
As well as boosting revenue, overseas expansion can reduce costs, provide access to new markets and talent, while multiple time zones can sometimes boost productivity, and shorten delivery schedules. Aspiring businesses must therefore grasp any opportunity to expand overseas.
There are many more lessons that startups can learn from scaleups, but perhaps the most important message is that a growing business never stops learning, and those looking to achieve rapid growth must foster this open culture.