Can you study hypergrowth companies and learn how to do things differently? The recent World Economic Forum report on 200 companies says, yes. In partnership with Ernst & Young, their new report, Mastering Hypergrowth, digs into how hypergrowth companies create stunning success:
Perhaps the most significant of our discoveries is this: hypergrowth is not a happy accident - it is not the outcome of people with bright ideas and positive market forces that 'just happen' to converge at one point in time. Far from it, in fact. Hypergrowth is actually very deliberate - it is the result of companies focusing on the priorities that will allow them to expand exponentially.
In other words, hypergrowth can be cultivated.
So what's normal growth vs. hypergrowth?
To understand hypergrowth, let's take a step back to first put some arms around the idea of normal growth. A normal growth company is able to grow between zero and 30% per year, sustainably--meaning for several years in a row.
Services firms, for example, whose engines rely on recruiting, hiring, training and retaining talent, grow on the slower side of that spectrum. Product companies can grow on the faster side. Hypergrowth firms grow astonishingly faster, freed from the friction of talent touching every process and from the constraints of producing a physical product.
How fast? The current world record holder for fastest growth is Supercell, a Finnish mobile gaming company founded in 2010 that was clocking $2.3 billion in revenue just three years later.
Hallmarks of hypergrowth
The World Economic Forum report discovered that hypergrowth companies do three things differently.
1. Scalability. Hypergrowth companies focus on the scalability of their model. That means they reduce every possible obstacle to a customer saying "yes" to them. Think about how many times Amazon has surprised you with a new opportunity to buy from them since you bought your first book there . . . like that.
2. Talent. Hypergrowth companies are not looking for skill sets--they are looking for attitude and "adaptitude." Instead of hunting down candidates with specific skill-sets to fill rigidly defined vacancies in the way that other companies do, "hypergrowth companies hire individuals who are the right cultural match for their own values and purpose. And instead of taking a competency-based approach to recruitment, they look for people with problem-solving and intercultural skills," the report reads.
3. Technology as a means to agility. Although many hypergrowth firms do have their own technology, it turns out "building new technological infrastructure is usually too slow for hypergrowth firms."
Most are avid users of technology and software period--not just for their business model, but in all aspects. That's because to manage their growth, hypergrowth companies are hungry for data and that data drives adaptation.
Have what it takes for hypergrowth?
The classic hypergrowth business begins with a challenging insight. Often, the insight is so challenging it flies in the face of current regulation or legislation, the World Economic Forum report points out. Think of the legal battles companies like Tesla and Uber are fighting.
However, despite all that, the disruption is so helpful to a section of a market that they attract customers anyway. As the hypergrowth company scales, it continues to focus on making its process as simple and easy as possible, with lots of opportunities to track data so the company can continue to adapt. In fact, the hypergrowth team is so purpose-driven, they often ignore negative feedback from outsiders in pursuit of helping their small, but devoted, customer base get the experience they need.
Hypergrowth is everywhere.
From using technology to provide continuous feedback, to developing a purpose driven culture around the customer, there are many hypergrowth playbook approaches at home in almost any headquarters.
Plus, it's clear hypergrowth isn't just a a Silicon Valley thing or the domain of a single country or culture. It is, in fact, a worldwide phenomenon that's always been a response of human civilization to opportunity.
Hypergrowth making history
Just consider a few of the early hypergrowth technologies that have transformed history:
1. The compass, circa 1400 from China, ushered in the Age of Discovery.
2. Moveable type, 1500, from Gutenberg, spread knowledge from a few hundred thousand manuscripts to over 200 million books in just a century, sparking the Age of Enlightenment.
3. The first lead acid battery, developed in 1859, made power portable--and now there are billions of them.
There are lots more examples, like the transistor or creating synthetic nitrogen, of technologies that spread across the world and changed how we do things--forever.
Hypergrowth is human.
Hypergrowth is unlocked by a certain disruptive attitude, carried forward by incredibly committed people, and realized with incredible attention to customer feedback and removing friction from the process. Now that you know how at home you can be with hypergrowth, how are are you going to apply it?