Scaling Challenges of Start-ups: Leadership

Heroic Leadership is always interesting and inspiring. This type of leadership is especially visible amongst early stage ventures / start-ups. But what provides strength and valour during the early days of venture creation, becomes the biggest weakness during the later years. When the start-up wants to scale and mature into an organisation, it becomes the singular weak link. The entrepreneur keeps wondering why his abilities are not helping any more. When this happens, the entrepreneur typically falls into two modes of thinking. They are:

  • First: The entrepreneur invariably gets caught in this self sympathising mode and begins to wonder if he/she has stunted. He/She begins to wonder if they are the right people to continue growing the enterprise.
  • Second: The entrepreneur finds enough reasons outside of himself, including but not limited to his employees, suppliers, distributors, costs, and many times customers themselves as the reason for not growing.

Both of which are wrong! The entrepreneur must recognise the fact that start-ups are very different from enterprises. The moment a start-up experiment has been validated and the start-up moves out of experiment mode, it has to be treated as an enterprise. Once we treat it as an enterprise, then we need everything that an enterprise system needs to stay moving – including but not limited to structure, systems, processes and importantly leadership. The problem with most entrepreneurs and the founding teams is that they don’t fundamentally believe in both till something / someone from outside forces them to think so. While they agree and put in place some systems and processes, they invariably falter when it comes to putting a structure in place. They end up creating a structure around them. They just fill their plate with more decision making responsibilities rather than move some out of their fold. There are companies where even after reaching 2 – 5 Crores in size, the entrepreneur is signing off petty pantry purchases. There is nothing wrong with controlling expenses, but the big question is, should it only be you doing it?

Heroic leadership or visionary leadership is what is required to create entrepreneurial ventures. We also need these entrepreneurial ventures to scale and grow so that they provide jobs and services to society. If they have to do this at a reasonable scale, the visionary entrepreneurs must also recognise the fact that they have to develop leaders. Developing leaders is a very important part of scaling an enterprise. How are you developing your leadership? Are you feeling exhausted wondering why no one else is not taking as much responsibility in your venture as you? Are you wondering why there is even after establishing scalability the venture is not scaling?

The question to ask is – are there leaders in your venture who are as good as you or better than you? Are you thinking and taking decisions as much as you within the enterprise? If you don’t develop this, the venture will invariably stall (at different levels though)!

Think about it!



2 thoughts on “Scaling Challenges of Start-ups: Leadership

  1. I agree with your arguments on scalability issue; but it is not limited to these arguments. There are many other aspects of business which will hold you back from scaling, such as the original design of the solution, market maturity for the product, etc.

    1. Absolutely agree George! Scalability of a high potential start-up depends on a large number of factors, but people issues / leadership / Team A development seems to be a big challenge. I find that it is a big issue especially with a lot of the young (Gen Y / Millenials) entrepreneurs. I hope to bring up the various other factors regarding scalability for discussion here too. Thanks for initiating it by sharing some factors via your comment.

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