The document provides tips on scaling a startup business model. It emphasizes that scaling is not easy and premature attempts often lead to failure. To scale successfully, a business needs to solve a problem that many people want solved, develop a sustainable model, build the right teams and culture, and ensure the model can repeat and grow through systems and processes that allow decreasing costs. The keys to scaling include validating engagement, mitigating risks, building the right networks, hiring ahead of needs, and raising investment at the right stages.

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Thinking Big:
A Scalable Business Model
Stephan Reckie
Chief Mentor

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Tips on business models
that enable scalability
Note: there is no magic bullet!

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Why Scale your Startup?
Who is at scale now?
Who wants to scale?
Who doesn’t?

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Timing
“Attempts to prematurely scale is the #1
reason ambitious start-ups fail”
Source: Start-up Genome

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Scaling your business model
Ask yourself, what are you solving for?
Example: Google’s mission now versus at
their beginning

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Big Idea - Worth Doing?
Biggest barrier to scale is lack of demand
Think about the other 90%?
Give yourself room to grow

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Validating your Engagement Model
Customer love = Growth

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Success in a scalable business
Offer something a lot of people want
Develop for a world problem
Bottom of the pyramid?
Radical innovation in emerging world?
i.e.. 2.4 billion people need glasses

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Risk Mitigation
Know your execution risks
Have a fall-back strategy
Be prepared and aware!

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Are you in the right networks?
Scaling is not a solo activity
Advice and trusted connections are key
Surround yourself with starters
The right ecosystem is important:
Customers, Suppliers, Partners, Employees,
and Investors

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People that have done it before
Pattern recognition is important - apply proven techniques
Hire for qualifications / experience / contribution – people
better than you and that you respect
Teams change - founders are not necessarily the final team
Embrace challenges and difficult conversations

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Live in the Future
Hire ahead of your needs
Long-term relationships are key
Look for skills that don’t exist today
Different people are the best people
Google hired Generalists, then specialists, having more than
one skill. They based on 30% ability, 30% smarts, 30%
leadership and 10% cultural fit
ABR - Always be recruiting

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What is Sustainability?
Ability to be maintained at a certain rate
Find the best sustainable model over time

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Company culture
Always nurture company identity and mission
Delight the customer - make them first
Own / understand the problem – feel the passion
Persistence - failures come before success

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Values
Focus on what matters
Cultural fit in hiring
Actively dispel myths
Values start at the Executive Level

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Focus
Communicate clear strategic decisions
It’s ok to say no to potentially great
opportunities to demonstrate focus
All employees follow company mission

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Cultural Fit
Hiring is most important in corporate culture
Corporate new hires might not understand
startup do-or-die
Pay close attention to team balance

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Diversity
Collective intelligence - solving problems in different ways is good
Great teams need complementary skills and approaches
Understand and appreciate different mindsets
Hire underrepresented and multi-disciplinary backgrounds
LinkedIn: Teamed up front-end engineers with UX
engineers and their users loved that experience

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Test continuously
As you grow regression testing is required
for scale
Objective A/B testing
Avoid wasting time and uncertainty
Resolve disputes with facts and data

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Key Performance Indicators
Track and refine steps for your growth

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Build Systems that Scale
Technical infrastructure
Data and analytics
Dashboard identifies bottlenecks
Develop organizational processes
Corporate “API”’s - Rules to ensure transparency
Evolution is important to scale

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Business Models that Scale
Repeatable offering – Cookie cutter
Infinite buyers – Little or no additional COGS
Scalable operations – Decreasing cost
Short cash cycle – Cash on Delivery
Recurring revenue – Predictable revenue
Shortest time to market is best

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Competition
Who are you competing against for your customers
attention?
You must outpace and underspend the competition

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Right money
Right mix of investment at the right stage
External investment helps scale
Trade-off between equity control and financial outcomes
Beware of too much or too little money
Smart money is absolutely the key
Beware of the early investor that doesn’t reinvest
Select investors just as carefully as co-founders

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Right money @ Right Time
Anticipate your needs
Understand the purpose of fundraising versus the amount
Communicate internally and externally
Raise only as much as you need, as scarcity builds clarity
Lean doesn’t mean starve

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About Stephan
26
Second generation Russian
Born in Harlem in Manhattan
Fortune 100 Computer hardware and software developer
Successful career in complex software sales
International software company executive management
Turkey, India, and China
Founder Angelus Funding - trust based Angel Investor Network
Numerous board and advisory level roles, including mentoring
Passion for Newspace - started Edge of Space

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Thank you
Feel free to contact me anytime
Stephan Reckie
+1-617-538-8641
sreckie@angelusfunding.com
@sreckie