Growing & Scaling A Startup

Growth is never by mere chance; it is the result of forces working together.
— James Cash Penney

Starting a company is rather easy these days. Capital is readily available, startup costs are low, and there are numerous amazing opportunities. Growing and scaling a company, however, can be much more challenging, which is why so many companies fail in the growth stage. 

To grow a company, one must move out of one’s comfort zone, understand the need to be agile, pivot when necessary, and move to managing people, versus managing a startup. From a valuation standpoint, companies of size and critical mass carry a much higher valuation and have many more liquidity options. As Warren Buffett said, “The investor of today does not profit from yesterday's growth.” 


Scaling and growing a company is hard, very hard. Most successful companies have had multiple near death experiences before their “overnight successes”. But understanding the challenges is the first step to mitigating the risks during this stage. Remember, as Ginni Rometty said, “Growth and comfort do not coexist.” Important factors include:

1. Assemble The Right Team

bullet Make the tough decisions and changes in a timely manner, when it comes to both people and product

bullet Learn to move from managing a company to managing people

bullet Assemble a functional team with proven track record, experience, and domain expertise that can work well together

bullet Manage the four pillars with equal care and attention: investors, board members, employees, and customers

2. Build Traction & Create Momentum

bullet A plane without momentum can’t liftoff

bullet Relationship building is crucial – Start early

bullet Growing a business is not a linear progression, there are lots of ups and downs

bullet Be a good story teller and deliver a focused, clear, story

3. Ensure Product/Market Fit & Market Readiness

bullet Ensure that the market is ready for the product and customers will buy at the scale and price desired

4. Target A Large & Growing Market

bullet Target a large, underserved addressable market that is growing organically

5. Create Scalability Across the Company

bullet Design a repeatable sales model

bullet Make sure you have the appropriate infrastructure, systems, compensation plans, customer success, repeatable sales model, and data systems in place

6. Create a Defensible Business Model

bullet Create a risk mitigated, sustainable, capital efficient business model with the appropriate monetization mechanism, with strong metrics and unit economics

bullet Pre-qualify everything – Your time is valuable

bullet Focus on running your business based on key metrics and unit economics

7. Be Competitive

bullet Demonstrate agility and ability to disrupt established players or create new markets

bullet You can’t be all things to all people. Show discipline and focus

8. Insist on Delivering Quality

bullet Focus on the quality and reputation of the brand

bullet Build passion into your story – Explain how you are changing the world

9. Have A Comprehensive Go-To-Market Strategy

bullet Identify your target customer, and where and how you can acquire that customer, and design a go-to-market strategy accordingly


10. Ensure Access to Capital

bullet Do NOT run out of cash

bullet Lack of access to capital is a leading reason for failure – Start early

bullet Remember, everything takes longer and costs more than expected

bullet Know how much capital you will need for 18 months, and how you will use it

bullet Monitor and measure your financials and metrics at all times

bullet The VC & PEG universe is small, and they talk - Don’t burn any bridges

“Anything you build on a large scale or with intense passion invites chaos.”

Francis Ford Coppola


Ivan Nikkhoo

July 2018

Ivan Nikkhoo