Every start-up faces a major new challenge once it achieves initial success: how to build a business that will last and prosper. And yet, so many of the most promising, exciting start-ups never actually make it past the early stages. So what are the key challenges scale-ups face and the potential solutions?

Speed and timing

The timing of scaling is extremely difficult. Do it too quickly, and the company’s emerging infrastructure buckles. Do it too slowly, and competition swoops in and steals your thunder.

Most businesses have a series of internal engines; marketing, sales, customer service and production, for example. Successfully scaling up involves formalising processes with robust process management and establishing KPIs that clearly measure progress – or lack of – and identify remedial measures to keep planned work on track. Don’t be slow to bring in specialists with the right knowledge and experience to guide you from energetic young start-up, through to a mature, stable, professional and sustainable business.

Access to finance

All too often, scale-ups fail because they can’t access investment, finance and credit lines. With the major banks still hiding behind their balance sheets, growing SMEs should look to alternative finance providers, many of which are Government funded. In the UK, some will be delivered via Local Economic Partnership (LEP) models using regional investment funds and other public pots of funding. Angel syndicates and venture capital funds are also potential sources of funding for ambitious and disruptive ventures.

Communication

As businesses grow, they typically move into different premises, locations and even countries. All of a sudden that ability to talk as a team around the kettle is gone. Suddenly, business leaders need to think about communication in a formal, systematic way. And through communication, they need to think about culture with that same robust, proactive approach. The sooner this work can begin the better.

Values

It’s far easier to consciously embed values and culture with a new group of 50 employees than it is to attempt a corporate culture programme 2 years down the line with 200 staff. All too often, start-ups are so busy focusing on the delivery of the business that they forget to decide, formalise and then code the values and mission that are fundamental to the business. There comes a point where it simply isn’t possible to run a growing business through the original start-up team. And this is where corporate management needs to come into play.

The better you can be at this stage, moulding the values (or habits) and mission (or personality) of the business, the easier it is to scale this up when new employees come on board. By formally agreeing and defining these attributes, you have the language needed to communicate what your business is all about to new hires. And the criteria against which to assess candidate suitability.

Recruitment

Scale-ups need to focus on three specific recruitment angles as they grow:

The first is good hiring. The focus must turn away from speed and towards quality. When you can’t find the right person to fill a gap, then don’t rush. Use a specialist recruiter if you need to because these new employees can have a tremendous impact on an evolving team, especially if your culture is still embedding.

The second is firing. You will inevitably take on people that turn out to be a poor match for your business. In those early stages especially, you are still developing your understanding as to who you are as a business and working hard to create that employer brand. You need everyone to pull together in the same direction; you simply can’t afford to carry employees who are off-message and looking to be carried along on the wave of others’ effort.

Linked in with the above, it’s essential to hire really good managers as early as you can. These individuals will be responsible for implementing everything that your leadership team agrees to push strategically and for ensuring that your new processes, procedures and communication approaches work as they should. Never underestimate the power of a great manager. Conversely, never underestimate the damage that a bad manager can do.

This article was written by Gary Reeman, MD, AlpinaSearch. If you’d welcome advice on attracting and retaining A-Players to help you scale-up your TMT venture, head over to https://alpinasearch.com/clients/