What's the one thing that most entrepreneurs, no matter the industry, say they want for their business? Growth. Rapid, big-time, and continuous growth. This is true in the early stages when a business is most fragile. It's also true after a company finds its footing and brings in more customers and employees. Growth, the thinking here goes, is the answer. The golden ticket.
The reality, of course, is far more complicated. While growth can provide credibility, resources, and revenue, it must be managed well. If it isn’t, it can undermine and ultimately jeopardize everything. Fast Company's The Small Business Guide to Growth Hacking, presented by OPEN Forum from American Express OPEN, explores what it takes to build a thriving business that manages to both expand and adapt to the myriad demands of a bigger company. More and more these days, the answers are rooted in what we call "growth hacking." That is, ultra-clever problem solving that short-circuits conventional sales, marketing, and product development approaches.
The range of perspectives and lessons that fill this exclusive collection, drawn from successful entrepreneurs and thought leaders alike, are designed to inspire and educate, arming you with strategies and insightful questions for whichever stage your company is in.
We delve into growth fundamentals, such as generating new business. Part of what propelled Airbnb, Spotify, and Groupon onto the scene, writes best-selling author Ryan Holiday in the chapter "How Growth Hackers Redefine the Game," was a savvy blend of marketing and technology that uncovered a wealth of initial customers and turned then-unknown services into viral sensations. And as serial entrepreneur Faisal Hoque observes, in the early days of Whole Foods, founder John Mackey focused on fostering an emotional attachment to the brand to nurture loyal customers, who then acted as evangelists.
For Nasty Gal founder Sophia Amoruso, the secret sauce behind turning a little-known vintage clothing store on eBay into a hot $100 million retail brand was a deep understanding of her customers. "It was very iterative," she tells Fast Company. "It all centered around what my customers were responding to."
Without a doubt, one of the keys to building your business is the art of the pitch. In "Guy Kawasaki on the Art of Pitching Your Ideas," which originally appeared in OPEN Forum, the marketing guru and best-selling author discusses how to tell your story well to win over potential investors, partners, and others. "Four Big Investments That Can Help Your Business Grow," also from OPEN Forum, highlights an area that entrepreneurs often overlook. But a cost-benefit analysis on major expenses such as hardware and real estate could maximize cash flow so you’re ready to respond to market opportunities.
Although there is no single path that successful small businesses follow to strong growth, some patterns emerge. "Dropbox Versus the World," an in-depth case study, illustrates how nothing fuels a company like new thinking, a fresh approach. In an impossibly crowded field, in which Dropbox and its then-twentysomething founder Drew Houston, the ultimate growth hacker, went up against Internet giants, the online storage startup survived with a simple solution supported by mind-bogglingly complex algorithms. It has continued to gain market share by cultivating that inventive mind-set in the latest executive hires.
One of the crucial lessons this collection addresses is the challenge of not being undone by growth and the accompanying complexity that affects everything from decision making to the supply chain to sales forecasting. One seemingly paradoxical solution is staying small and growing simultaneously. Andrea Sittig-Rolf, the founder and CEO of BlitzMasters, a Seattle-based business-development consulting firm, writes about her decision to increase profits rather than focus on boosting revenue. She used technology to embrace "smallness" and new efficiencies rather than add to her payroll. That’s an insight every small business can learn from.
More often, though, staying small while getting bigger is a strategy designed to retain a certain nimbleness, in both mind-set and execution. Uber founder and CEO Travis Kalanick puts it most succinctly in the Dropbox chapter: "How do you make sure that you don't become the big company that becomes rigid, brittle, and disrupted by the new guy?"
Truly forward-thinking entrepreneurs are prepared for the organizational transitions that come with maturity. If there's one aspect they get right from the start, writes Steven DuPuis, founder of the design innovation agency DuPuis Group, it's vision. With that comes a sense of purpose and meaning that guides how a company responds to new opportunities and challenges as opposed to simply chasing revenue. "Vision," he writes, "is what pulls at our emotions and creates desire to challenge the status quo."
In other words, to innovate. For any business, large or small, that ability is perhaps the most enduring growth hack of them all.
Chuck Salter for FastCo.Works, Fast Company's content studio.