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By Edwin Andrés Casallas Larrotta, Head of Business Development Colombia & Ecuador at Wayra Hispam

It is common to find entrepreneurs at different stages breaking their heads trying to decide what strategy to follow to grow and scale their startups without dying in the attempt. This is highly complex because each organization operates in a different context, depending on the environment and time, as well as the personality of its leaders and founders, whose aversion to risk is usually very different.

At first it seems that, after all the effort to find the ideal market opportunity, develop the product, build a team, create the company and raise the first investment, the entrepreneur would have achieved the goal and dream that many long for but few achieve: survive. But this is only the beginning, reaching this stage means the beginning of another stage in which the problems are different and to some extent desirable, such as having more clients than the startup can serve with its current structure. This is a sign to take the next step, it is time to grow.

But growing a company is not so simple, organizations are complex systems that are not managed in a linear way or under the step-by-step of a protocol. Your leaders will always face VUCA (Volatility, Uncertainty, Complexity and Ambiguity) environments where volatility and uncertainty will be traveling companions. For this reason, it is necessary for these leaders to learn to manage growth .

When growing, traditionally you have to take into account the focus and the environment, as shown in the following table:

And this is where you can begin to visualize the concept coined by Reid Hoffman, co-founder of LinkedIn, in his book Blitzscaling with Chris Yeh. Blitzcaling means prioritizing speed over efficiency in an environment of uncertainty.

In a classic growth approach, a startup starts in an environment of uncertainty focusing on efficiency, optimizing all its resources and making sure that its product meets the customer’s need. In Fastscaling the strategy assumes having certainty, that is, predictable costs, clear knowledge of the competition, stable markets, among others.

In Blitzscaling , the approach is to grow rapidly, assuming great risk in an environment of high uncertainty. It is accepted that the speed that will be given to growth will bring with it mistakes that must be learned very quickly, solved and kept moving forward in order to quickly gain a critical mass of customers or a dominant position in the market. Blitzscaling is arguably an all-or-nothing philosophy where the greatest risk is seen as moving too slowly.

Several well-known organizations have traveled the path of Blitzscaling , such as LinkedIn, Waze, Facebook, Amazon, among others. The latter is a good example since it multiplied its income, managing to go from 6.92 billion to 386.06 billion dollars from 2004 to 2020, according to statista figures.

In summary, Blitzscaling seeks:

• Grow very fast.
• Global scalability.
• Be the first to climb.

It is necessary to keep in mind that Blitzscaling is not a magic formula and that it will work only in specific scenarios that revolve around:

1. Design an innovative business model that can grow. This business model must be designed thinking about achieving exponential growth, maximizing growth factors and minimizing limiters.

2. Design and implement a growth strategy, not just aim for it. There are four factors to consider for this:

• New and great market opportunity.
• To be the first to scale, reach critical mass and generate competitive advantage.
• Learning curve, solve complex problems and build on them.
• Competition, the more likely, the faster you have to move.

Blitzscaling is not a permanent strategy. If the market stops growing or reaches a limit, you have to stop. Some red flags are:

• Receding growth rate (with respect to the market and competition).
• Worsening of economic indicators.
• Decrease in productivity per employee.
• Increased management burden.

3. Innovating in management is necessary because of the stress that growth is going to put on the organization. Skill is required to evolve and optimize management practices in each growth phase. There are eight key moments and nine rules that defy conventional thinking necessary to manage the frantic pace of growth that Blitzscaling imposes:

Key moments

• From small to large teams.
• From general profiles to specialists.
• Progressive differentiation between manager and executives.
• From dialogue to communication.
• From inspiration to data.
• From focus on a single product to diversification.
• From playing offense, to playing offense and defense at the same time.
• From founder to leader.

Rules

• Embrace chaos.
• Recruit the necessary people at all times, not the best.
• Tolerate mismanagement.
• Speed is everything, better fast than perfect.
• Let some fires burn, you can’t put them all out.
• Do things that are not going to be protocolized.
• Listen to the common of all the clients but not the details of each one.
• Get a lot of investment.

Evolve the culture. Entrepreneurs willing to accept risks and navigate them responsibly are candidates to lead Blitzscaling growth in their organizations. Vehicles such as Wayra, Movistar’s corporate fund, can be the perfect tool to accompany this stage of scalability at a global level.