Assuming that you've successfully started a startup. Scalability is the ability of a startup to grow. Or, to put it more precisely, a scalable business can adapt to a larger workload without compromising performance or losing revenue. Can your business with $0 in annual revenue grow to a million dollar company?

If it's scalable, then yes.

But not every business is poised to make it big. Some startups get off the ground without the right systems, people, or mindset in place. Trying to grow such businesses is like trying to inflate a tractor tire with a bicycle pump.

Here's how you can prepare your startup to scale up.

1. Get the basics down.

Before you even worry about scaling your startup, make sure your fundamentals are fool proof. According to the StartupGenom's survey of 3200+ startups, 74% of failures can be explained by premature scaling. So make sure you're covered for the following:

  1. Make sure your core product line reaches "market fit". You can make gradual improvements through product iterations based on user feedback and data.
  2. Find out your largest core users.
  3. Find out the marketing channels with the biggest ROI and scaling potential by testing with smaller budgets first.
  4. Make sure you have the resources to scale. Seek additional round of funding if necessary. You can't worry about profitability while scaling, and the last thing you want is to run out of money.

Note: Even though these practices are software-centric, they also apply to physical products. So if you started an e-commerce site, make sure you take the time to get the basics right before scaling.

2. Automate Everything.

If you're spending a long time "setting up" your business, then good for you.

  • Setting up cloud storage and organization...
  • Setting up training processes for new hires...
  • Setting up marketing automation...
  • Setting up payroll for rapid processing...
  • Setting up billpay for automatic withdrawals...

Even though it takes a long time on the front end, this activity will pay for itself in the long term. You'll be able to access data faster, hire faster, market better, pay easier, and streamline operations for a truly scalable model.

3. Boost marketing.

How can a business scale if no one knows about it?

Focus on marketing, and scalability will follow. But not every form of marketing is scalable. According to Forbes "direct marketing is...not scalable" and "word-of-mouth does not scale."

Content marketing, on the other hand, is one of the most scalable growth methods. Content marketing has evergreen value and viral potential, making it the growth-hack method of choice for most startups.

4. Outsource non-essentials.

For big corporations, the name of the game is "in-house." They've got in-house graphic designers, developers, conversion optimizers, SEOs, CPAs, lawyers, and even janitors.

Startups can't afford that luxury, and if you want to be strong enough to grow, you'll need to outsource all non-essential roles.

Your graphic design firm doesn't need a law department. Your SEO consulting firm doesn't require a full-time PowerPoint designer. You just need to focus on what you're good at.

This lean approach is what allows a startup to break into the big time. When you're nailing it with your core competencies, you'll start to scale up.

5. Keep an eye on social media.

Every new startup is in the public eye. Whatever happens on social media will be examined by the world.

It's important in your startup days to watch your social media carefully. Fledgling startups can't afford to take a major PR hit with a social media flap. Big companies might be able to weather the storm, but your startup isn't ready for it.

Scalability is about surviving, as much as it is about growing. If you hit a PR fiasco, you're limiting your chance of survival and scalability.

6. Excuse yourself.

Your business is not about you.

In order to be truly scalable, your business should be able to function just fine without you. The way you put that into place is by deliberately shifting responsibility off your shoulders, or into the oversight of someone else. In addition, you should take deliberate absences so you can force the business and personnel to be independent.

It may be a little bit humbling to come back from a four-week vacation and discover that the business is thriving without your being there. But this can actually be encouraging, too.

Your business is making money while you sleep, relax, or build something else.

You've proven to yourself and to your employees that the business isn't tied to your presence or even your existence. You feel liberated. They feel empowered. The business is ready to grow.

7. Hire the right people (and only the right people).

A business is scalable, only when it has the right people on board.

First, though, you have to hire only the people that are necessary to the operation. (See "outsource" below.)

Here are some of the key characteristics of a team member who will help you scale:

  • They can do what a program can't. If you have a human doing something that a machine can do, then you're wasting human effort. A startup needs to automate everything that it can in order to maximize the output of human team members.
  • They are full of good ideas. You can't put a dollar price on the value of a good idea. A single lightbulb moment on the part of one employee can more than pay for that employee.
  • They have more than one skill. In the startup environment, one person might have to do three jobs. Hire people with a multifaceted skill set, or skills that can be transferred from one task to another.

Final thoughts.

Scalability is a mindset, too. Sure, you need to have the right systems and processes, people, and plans.

But you also need to think big to become big. Having a scalable business means that you are free to unleash your dreams, make a lot of money, and have fun doing it. Once you get your mind in the game, scalability becomes way easier.

What have you done to create a scalable business?

Published on: Dec 18, 2014