Scaling strategies for Midlands start-ups

Midven Scaling strategies for Midlands start-ups

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Scaling strategies for Midlands start-ups

Start-ups often find themselves at a critical juncture: the transition from a small, agile venture to a rapidly growing company. This phase, known as scale-up, presents both exciting opportunities and formidable challenges. 

In this blog, Midven associate, Jordan Ong, explores proven tactics and frameworks for businesses transitioning from a start-up to a scalable, growth-oriented company. Explore the actionable insights into unlocking growth opportunities and overcoming common challenges faced by Midlands-based start-ups.

What does it mean to scale-up?

Scaling can be simply defined by the word “expansion” – that is, to increase in size or number. 

However, the process of scaling a start-up does not entail a one size fits all approach. It requires a tailored plan that aligns with your start-up’s unique circumstances, industry, and growth trajectory. 

Scaling is an art and a skill, it requires founders to navigate their business through a chosen course, taking advantage of changing conditions as they unfold and present themselves. At the foundation years of a company, the thought process of the founder is all about survival. 

As a founder you are reliant on seizing opportunities and employing opportunistic tactics. These manoeuvres extend your business’s runway and keeps it afloat, but it does not lead to sustainable growth.

 

Achieving sustainable growth

So how do you achieve sustainable growth for your start-up? Well, as discussed, survival alone won’t propel a business towards sustained economic growth, instead, only a clear and compelling long-term vision and associated actions towards this vision can. 

You need to remain agile and adaptive, but also consistently remain on track with a “north star” in mind. The concept of a “north star” does not reflect a pot of gold, but instead a purpose, a mission, a goal. Remember, as Thomas Edison put it, “Vision without execution is hallucination.” 

Read on to discover the steps you can take to make your scaling aspirations a reality.

 

Strategy and opportunities

To successfully scale your business, at the early-stages, it is critical that you invest the proper amount of time to conduct a series of must-do analyses, also known as due diligence. The due diligence that you should be focussing on includes understanding the customer opportunity. 

Firstly, be aware of the macroeconomic conditions in which your business operates. You should consider regulatory changes, socio political and economic events, and more. 

Such factors can be critical to the success of your business, and if not considered at every stage of the scale, the outcomes can be uncertain. The key here is to attempt to reduce information asymmetry. 

Secondly, explore how your product compares to various alternative propositions that are on the market. It is important to understand how to make your offering different or distinctive to the rest. 

Remember, a distinctive product with either strong patents or intellectual property (IP) provides a competitive edge and a defensive moat. 

Additionally, consider the use of data within a digital landscape. In a world full of data points, businesses must take the opportunity to capture customer insights. Such insights can provide meaningful understanding into what your customer is thinking about your product or service. 

Once insights are collected, you can then optimise experience, begin meaningful product development, personalise sale strategies, and deliver key compelling messages that resonate the most.

 

Build a tribe

Consider the type of business that you want to become, this can be thought of as your brand. In the modern age, customers are not solely focussed on products, but instead they are focussed on meaning. Customers buy products to build their identities, they buy into tribes to feel safe and successful. 

Therefore, consider creating the customer, positioning them for success in the world by identifying what they are trying to do in their lives or their professions or industries and then helping them do it. 

Customers know when they are buying a product or service, and they are aware of the benefits, but what they are truly looking for is the brand meaning. Great brands have something more than just functional benefits, even the boring industrial ones. 

Having more isn’t as important as being more. Today, it’s about the customers and what they become in their lives.

 

Building your team

To successfully scale your business, it’s not all just about a brand, it also requires you to build a sound team with a shared commitment and uniform behaviour. As Steven Bartlett says in the Diary of a CEO, “The truth is, your destination will be defined by the sum total of the ingenuity, ideas and execution of the group of people that you assemble. Every great idea, everything that you create, your marketing, your products, your strategy, all of it will come from the minds of the people that you hire!”

So triple down on the things that you are good at. 

Ultimately, business is all about people, and it is critical that you bring in the best possible stakeholders you can at every stage of your business and its journey. Most of the time, relevant expertise is critical for success. 

The cost in bringing the best talent can be expensive, but you possess something far greater than money, you have equity. Ensure that you use this equity precisely. Equity itself reflects the greatest proposition.

Follow this guidance on tech hiring in the West Midlands.

 

Common challenges Midlands-based start-ups face

The challenges Midlands-based start-ups face aren’t exclusively to their being located in the West Midlands. Instead, start-ups across the UK all face similar challenges. 

One of the biggest challenges faced include access to finance. The funding needed to kick start the business, especially for those who do not have the collateral. Even if they can access the finance required, founders are often suppressed with high interest rates in today’s environment, or the funds raised may not be used effectively and efficiently. Therefore, it is essential that a founder has a well thought through plan to execute. 

Despite access to finance being a major challenge for entrepreneurs, there are ways in which businesses can flourish. Funding can be accessed via venture capital funds like ourselves, angel investors, or grant funding. 

For instance, the UK Government offers the UK registered organisations to apply for a share of up to £25 million for game changing and commercially viable research and development innovations that can have a significant impact on the economy. This is the Innovate UK Grant, however there are many other types of grants available.   

You should also be looking to operate and scale within specific clusters identified within the region to take advantage of synergies, opportunities, and knowledge. The Cluster Growth Profiles outlined by the West Midlands Combined Authority is an example of this.

Alternatively, consider co-investment opportunities that enable a collaborative funding solution. Discover why co-investment is Important for Startups in the West Midlands here.

 

Conclusion

Transitioning from start-up to scale-up demands strategic vision and meticulous execution. To grow sustainably you will need a clear purpose and agile adaptation, as well as thorough due diligence, differentiation, and brand building. For this, building a committed team and accessing diverse funding sources are crucial steps. 

Despite challenges there are many resources and collaborative opportunities for Midlands-based start-ups to leverage. With these insights and funding you will be best positioned to navigate scaling complexities and emerge as a thriving enterprise in even the most competitive scale-up landscape.

Contact us to find out how we can help scale your business.