The above diagram shows the improved growth as a business moves from an early stage startup, through to a later stage startup, gaining traction in terms of your customers and business processes.
As a later stage startup, this is where you’ll likely be looking to close on your Series A funding round. Some of the typical aspects of this stage include:
- Focus on Innovation: Introducing new products, services, or business models that aim to address unmet needs or gaps in the market.
- Limited Resources: Operating with limited resources, including capital, human resources, and infrastructure. Often in the process of securing funding and building a team to support your growth.
- High Risk and Uncertainty: Still testing your business hypotheses and market assumptions.
Overall Objective: Prove the viability of your business idea, secure funding, and achieve product-market fit.
Once series A funding has been achieved, it’s time to look to the next stage of scalable business growth (scale-up) which is characterised by slightly different criteria:
- Focus on Expansion: Shifting your focus from the experimental phase to scaling your successful business model. Aiming to expand and grow operations, enter new markets, and increase market share.
- Increased Resources: More resources at your disposal, including access to funding, a larger workforce, and established infrastructure.
- Reduced Risk: You’ve already validated your business model and achieved a degree of market acceptance.
Overall Objective: Achieve rapid and sustainable growth, increase revenue and profitability, and establish a strong market position.
The right moment in time
If you’ve achieved your series A funding, it’s probably time to enter into your next phase of rapid growth and expansion. With new targets and opportunities on the line, this is where it takes foresight and that previously mentioned confidence to take your business to the next level. We like to demonstrate this ‘gap’ and the moment in time to push the business into the scale-up phase using the concept of Charles Handy’s Second Curve.
If you’ve not heard of this concept before, it was introduced by Charles Handy, a prominent management thinker and author, in his book “The Empty Raincoat: Making Sense of the Future” published in 1994. The Second Curve is a metaphorical representation of the challenges and opportunities that individuals, organisations, and societies face when navigating periods of significant change.