SCALING STARTUPS: SHOOT FOR THE STARS,

…BUT BUILD YOUR ROCKET FIRST.

“We must obey the forces we want to command” (Francis Bacon)

Author: Alexandra N. | Founder, WE CREATE BRIGES | December, 2015

2 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

TABLE OF CONTENTS

INDUCTIVE THINKING 3

THE FLOATING OF THINGS 3

HARNESSING LAWS OF NATURE 5

ABOUT WE CREATE BRIDGES 8

WHO WE ARE 8

WHAT WE DO 8

HOW WE DO IT 8

WHY WE DO IT? 8

ABOUT ALEXANDRA N. 9

3 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

INDUCTIVE THINKING

In 1620, Francis Bacon publishes his philosophical work Novum Organum Scientiarum (‘new instrument of science’ ).

He details a new system of logic he believes to be superior to the old ways – against the Aristotelian approach to science through logic and deductive reasoning alone.

He argues a different approach is needed given the weakness of the human mind and it’s natural biases (he lists the Idols of the Mind in his work; today we’d call them cognitive biases ).

According to Bacon, inductive reasoning will allow humanity to uncover the essence of things. His method relies on systematic observation of cases, engagement of the senses, and artificial experimentation to provide additional observance of a phenomenon and it’s causes.

THE FLOATING OF THINGS

Until mid 19th century, most boats were made of natural material, essentially wood – as men observed wood float in nature.

The naval engineering techniques have evolved with the understanding and mastery of the laws of gravity, buoyancy, hydrostatics, hydrodynamics, density, etc.

“The law of floatation was not discovered by contemplating the sinking of things, but by contemplating the floating of things which floated naturally,

and then intelligently asking

4 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

why they did so.” (Thomas Troward)

With new materials provided by industrial revolutions ( iron, steel, lately kevlar) and contemporary computer aided design, it has been made possible to design more performant naval structures.

Interestingly, until recently, naval architecture has been more of a craft than a science: the “fair shape” of vessels was judged by looking at half models or prototypes ie. through past knowledge and experimentation rather than by logic and deduction alone.

Therefore, today it’s totally understandable to see the proliferation of Uber for X, Airbnb for X business ideas (see article here) ). It’s in human nature.

Nevertheless, just like there a difference between a floating piece of wood and a boat, there’s a difference between applying the concept of Airbnb and Uber to a different industry and understanding and mastering the underlying business forces at play that make Airbnb or Uber successful.

Bacon argues man cannot subtract himself from the forces at play in Nature (“we must obey the forces…”), nevertheless he has the opportunity to harness them (“we want to command”) when he gains a deep understanding of their effects.

The same way aspiring entrepreneurs & startup leadership cannot subtract themselves from the Market forces at play (value creation, strategy, operations, unique capabilities, business model, scaling laws, ….). They need to understand and master them to harness sustainable growth.

5 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

HARNESSING LAWS OF NATURE

The first theoretical proposal of space travel was published by William Leitch, astronomer and mathematician in 1861. It only became an engineering possibility with the work of Robert. H. Goddard in 1919.

Two of Goddard’s 214 patented inventions were instrumental to making spaceflight possible (multi-stage rocket and rocket fuel, 1914). He designed and elaborated an engine powerful enough to escape Earth gravity, and a vessel that could perform in a vacuum such as that in space.

“ It is difficult to say what is impossible, for the dream of yesterday is the hope of today and the reality of tomorrow.” (Robert. H.Goddard)

Astrodynamics, or orbital mechanics governs the motion of rockets and spacecrafts. These mechanics are calculated from Newton’s law of motion and Newton’s Law of universal gravitation. Therefore spaceflight was made possible by the thorough understanding and mastery of existing and identified physical laws.

Similarly, for startups to scale successfully, they need to be able to design their multi-stage rocket to extract them from idea stage and propel them in business orbit: a five stage rocket to be precise.

Each of the stages could be summarised by the Greiner Curve – created decades ago by Larry Greiner, which illustrates how all businesses go through five distinct phases of growth and relative calm (evolution/growth) alternating with six distinct phases of chaos (revolution/crisis).

6 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

Greiner’s Curve from HBR – “Evolution and Revolution as Organizations Grow”

Scaling up means being able to design a company with

⊕ an “ownable purpose”,

⊕ a scalable culture,

⊕ an effective decision-making and communication system,

⊕ along with relevant talent management

⊕ and processes to take the company along the different phases of growth without stalling or breaking.

It is possible to do that by understanding the forces at play, and reverse engineering the design of your company to avoid the negative dynamics your organisation will have to face:

7 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

⊕ inadequacy of communication and decision-making processes will put the business at risk – errors, confusions, inconsistencies and excessive workload.

⊕ inadequacy of organisation or pacing will “burn” resources as efforts are misallocated to non-critical areas

⊕ Company culture and purpose will be diluted, conflicts will arise between internal stakeholders (employees, managers, leaders).

Our message to scale-ups: shoot for the stars, …but built your rocket first.

“It is not possible to run a course aright when the goal itself has not been rightly placed.” (F.Bacon)

8 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

ABOUT WE CREATE BRIDGES

Who we are

We are a consultancy that enables companies and their teams to scale successfully through the design and implementation of smart and sustainable organisational and management structures.

What we do

We help you reverse engineer the evolution of your company. We help you take into account the key components of successful scaling and future proof your business for the increased complexity and high uncertainty that come with the scaling process.

We ensure the ability of your company, teams, processes to handle an increase in demand such as sales, customer support or the need for innovation in a sustainable and cost-effective way

How we do it

We provide our clients with an architectural map of their future organisation, and a roadmap to get there, with built-in flexibility to adapt to changing environments.

Why we do it?

Entrepreneurs are the most important players of the current economy and we believe that the companies they founded should be given the best chance of continuous success.

Yet, too many start-ups fail.

⊕ 9 out of 10 of new companies fail within 3 years

⊕ 3 out of 4 of those fail due to unsuccessful scaling

9 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.

It is a tremendous loss of time, energy, money, and unfilled opportunities. We believe companies should not fail to the extend they do, and they should not disappear for mistakes that could be avoided. Our purpose is to help decrease of that number.

ABOUT ALEXANDRA N.

Alexandra is an executive leader with 20 years experience in Strategy and Management roles with a focus on Digital and Marketing Services, Business Intelligence , Analytics and Market Research – across a wide range of industries.

For the last 20 years, she has been advising global companies such as P&G, Nokia, Volkswagen, Hilton, etc. on how to transform their capabilities to capture opportunities brought by Digital; as well as advising MarTech Startups on how to best address and bring business value to companies (back in 2007 P&G and AdViewability tech Alenty - acquired by AppNexus, more recently Ferrero and eCommerce solutions such as Storetail).

She’s a perpetual learner in the fields of cognitive sciences and behavioural economics and passionate about integrating modern thinking and principles from these disciplines (and others) to accelerate innovation and empower the next generation of companies and teams to transform and scale in an sustainable way, and with soul.

10 This article by WE CREATE BRIDGES is licensed under a Creative Commons Attribution – NonCommercial- ShareAlike 4.0 International License.