Public markets are down. The New York Nasdaq, which contains many of the most renowned U.S. tech stocks, has fallen by more than 25 percent this year. European tech companies have been hit hard, too. Year to date, Just Eat and Deliveroo have lost around 60 percent of their market cap.
In response, many of the formerly hyped high-growth companies are trying to decrease cash burn and are cutting staff.
Is Blitzscaling dead or still a compelling growth strategy.
‘Scale-ups’ face many high-growth challenges. One of the biggest is hiring and retaining top talent. Among the top talent needed for successfully managing a high-growth journey is a strong chief financial officer (CFO). This is why, on the board, we regularly discuss what to look for in a (new) CFO. Usually, these discussions end up with something like we need a 'strategic and commercial' CFO. But what does this actually mean? How should one assess whether a CFO can drive growth successfully.
Irrespective of the business model you pursue, you have two very important high growth levers: efficient customer acquisition and strong customer retention.
Conducting a thorough cohort analysis process can help you achieve both and ignite explosive sustainable growth. In this article, I explain why and how.
Founders often underestimate the complexity that comes with (additionally) targeting the long tail of small business customers.
While there are very often many small business customers, their willingness to pay is likewise often significantly reduced. Their needs may differ too. And most of the times, small business customers can only be acquired through different channels.
In this article, we explain how to sell to the long tail of small business customers.
The unit economics concept is a powerful tool that helps you better understand whether you pursue a viable business model. By deconstructing the unit economics and focusing on improving all underlying variables, you can also steer your business towards high growth readiness. Have the patience to develop strong unit economics. It will eventually pay off and pave the path to sustainable high growth.
If you want to work successfully with channel partners, you need to understand why they could be interested in helping you distribute your products. They will be interested if they see significant value for themselves in working with you. Otherwise, they will not care at all. That’s business.
Many founders believe their target market is larger than it actually is. Thoroughly analyze the size of your target market. Make sure it is large enough and that market dynamics support your high growth plan.
Founders who have just raised growth capital understandably want to demonstrate they can significantly grow their businesses. But some founders lose focus. Instead of scaling the existing business and adding a growth channel, a key target customer segment, or a new target market, they want to achieve everything at the same time. The corresponding complexity is a growth killer.
Product/market fit is necessary. You need to get to product/market fit before you accelerate growth. But it is by no means all that matters!
What good is product/market fit if you do not find a predictable and scalable distribution channel through which you can sell your products and services on attractive economic terms.
Without product/channel fit, no high growth or unnecessary cash burn. Game over!
Before you accelerate growth, make sure you have generated product/channel fit.
With a company-wide focus on customer success you can achieve your growth and exit valuation goals. If you make your customers incredibly successful, they will churn less, buy more and spread the word. Referrals will further reduce customer acquisition costs and CAC payback period. You recoup your investments quicker and can reinvest the money in order to further fuel your growth engine. A virtuous cycle!