I previously wrote about thinking slow (strategy) and moving quick (execution).
Now, it’s time to talk about results you’re meant to derive from pairing your strategy with your execution.
One way to measure results is the output of growth.
Growth is a straightforward concept — something is getting bigger at an identifiable rate of change (pace).
The math is easy — (current period # / prior period #) – 1.
So, how did growth get to be so complex and all consuming?
And can it really be all that matters?
Time to explore.
Here’s what we’ll cover:
Part 1: Growth Working Against Us
- Mania
- Myopia
- Mishaps
But first, An Ode to Growth:
Growth, oh Growth
Ye of complexity
Who are you exactly?
Is it the you who compounds
Or the you who confounds?
That craving we chase
Did you just smack me in the face?
You make us so great!
Why must you utterly deflate?
I guess it’s both
Can You Smell It? Growth-Induced Mania
I scream, you scream, we all scream for GRRROOOOOWTH!
Those of us in and around tech are inundated with growth (and fundraising) narratives on a daily basis.
It’s the ultimate sizzle.
Ladies and gents, we have another unicorn!!
Growth grabs the headlines and does not let go, muscling out would be competitors.
Who cares about such staid topics as pushing the ball forward to boring ‘ol profitability? Bleh!
The Rock Shut Up GIF By WWE (source: giphy.com)
*highly encouraged rabbit hole to go down*
I’ve certainly never heard of a “sustainability hacker”, “product-led profitability” or a “margin expansion round”.
That sort of prestige is reserved for GROWTH.
But, is it really ALL we should care about all the time?
Can You See It? Growth-Induced Myopia
Growth mania can naturally lead to our own myopia as operators.
We may get tunnel vision with growth as the only objective to pursue. The end all be all of all of our efforts.
To be sure, growth is an important output, and we should strive for growth of our businesses.
That’s not necessarily the same as growth in our businesses. Key distinction right there.
This tunnel vision can lead to looking at (measuring) and working on our businesses with too much bias.
Anything we can identify that may drive growth may be deemed superior. Other initiatives? Detractors.
Not everything, everyone and every decision in the business needs to be pointed squarely at growth.
Beyond being counterproductive, this can be dangerous.
Can You Feel It? Growth-Induced Mishaps
Raise your hand if you’ve ever heard of (or lived) a growth story that didn’t end up so well.
If we fall victim to seeing growth as the only thing that matters, we may:
- set inappropriate goals that drive misinformed execution.
- chase growth erratically only to constantly run in circles in our pursuit of its glory.
- run out of resources: time, energy, money.
Let’s just say, we’ll probably end up gorging on growth.
And chances are we’ll end up with bloat.
Team bloat, product bloat, cap table bloat, burn bloat.
All the bloats working in tandem can often make us sluggish and less nimble.
Beyond a bit of indigestion and the need for a nap, we may be setting ourselves up to go wildly off course.
We need to appreciate the costs and implications that can come along with this.
Things like:
- Our optionality – Once we go down the growth at all costs path, it’s hard to get off it. Oftentimes, we’ve sold our optionality to others who may want/need us on that path for them to succeed. So, they’re loath to let us off of it. They may acquiesce but not without some sort of fight or just writing us off as a failure.
- Our ownership – The growth at all costs narrative and supporting venture capital elixir is sold to us and many others (in a portfolio) in exchange for some of our ownership and control. If it doesn’t pan out, it hurts real bad for us. We don’t have another company to fall back on. For the purveyors, it’s not really that big of a deal. It’s to be expected in most cases.
- Our longevity – If you care to have a business that can succeed over the long-term, you should probably approach building it to align with that. With that mindset, you can be 100% secure and comfortable trading off (even turning off) growth at times. If you’re really out to be a “serial entrepreneur” who starts something new every few years, has no problem burning through gobs of outside capital and is not bothered by abject failure for whatever you’re currently working on, you can probably just ignore this whole piece.
Why would one choose to take on these costs?
Good Reasons – You actually want to pursue this path. The path is actually viable. The market opportunity and your potential and ability to seize it are just too great to not go for it. You can stare down the potential for abject failure of your business and sleep just fine at night knowing the trade you’re making.
Bad Reasons – Someone convinced you to do so without you understanding what you’re getting yourself into. I’m advocating giving ourselves a bit of a break from our growth obsession and the trappings that surround it. With some thought, I’m sure we can come up with some other valuable ways of thinking about our success.
Next up, I’ll put forth some thoughts re: Working with Growth — contextualizing, corralling, and timing it.
