The OECD defines a scale-up as a company that has achieved 20% annual growth in headcount or revenue over the past three years. Simply put, they are startups that have started to gain market traction and achieve significant growth, without having to multiply their workforce or investment to the same extent. Examples could be Unit8, a data services company based in Lausanne, that has grown 44 times between 2017 and 2021, or the global employment platform Oyster, founded by IMD alumnus Tony Jamous, that has grown from two founders to almost 500 people in three years.
We define a startup as “an organization formed to search for a repeatable and scaleable business model”, so what is a scale-up? This could be defined as “a transitional organization built to develop the ability to execute growth and attract capital”.
Europe still lags behind the United States when it comes to nurturing fast-growing businesses. A 2019 report for innovation advisory firm Mind The Bridge found there were almost 23,000 scale-ups in the US, versus 7,000 in Europe.
There is no one-size-fits-all approach to transition from a startup with steady growth to a company with scale, but what unites all successful scale-ups is great leadership. As Ed Catmull, co-founder of Pixar, and the former President of Walt Disney Animation studios, said: “If you give a good idea to a mediocre team, they will screw it up. If you give a mediocre idea to a great team, they will either fix it or throw it away and come up with something that works.”
But what makes a great team and leader? Over 30 years, working for and with hundreds of early-stage companies, co-founding three myself, I have identified what I believe great leaders and teams do to transform their businesses from promising startups into fast-growing scale-ups:
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