What is Hyper Growth?
Filed under: Innovation
What is Hyper Growth?
So it’s all about the idea and the technology, right? This idea / service / product / application / technology is so revolutionary that if we can just let our market know the sales will flock to our company… As most of the people reading this know, that’s just a “Field of Dreams.” Very seldom does Build It and They Will Come ever work. How do we get so fooled? By the time we figure out that sales are not there, we have invested our own money, raised capital from friends and family, perhaps other sources. And in an entrepreneurial initiative of a larger company we have bet our career on this new product line.
At first, our sales look exponential. They are doubling every period; the first quarter, the first year, perhaps even the second year. But that may not be the success that it appears. Let’s talk about some fundamental truths.
Small numbers are easy to move
The expectations of that first quarter are remarkably achievable. You know people that have the problem that you are trying to solve. Maybe that is how you started working on this in the first place. They know you; they trust you. They will be the early adopters. And even better, they might be tolerant of the development process and understand that you are defining and refining the solution. And you are starting from zero or nearly zero. It is not the first million that is hard; it is keeping the momentum going in the third or forth year when the bogie is 10 or 100 million.
My son’s Koolaid stand looks like the next Google. Mom and Dad bought the first product, then our next-door neighbors bought a glass because they like the kid or at least are glad to see him doing something other than teasing their dog through the fence. Tracking it on the spreadsheet: it looks like a great growth curve — No sales, first hour – 4 glasses, second hour – 8 glasses,. The little dude is looking to do a private equity placement to buy sugar and mix in massive quantities. Ignoring the fact that the cost accounting is a bit shaky-Mom and Dad were free labor, Mom spent $6 in gas driving the SUV to get the glasses that cost more than the sugar water, and the $37.00 of art supplies to create the point-of-sale advertising that began to melt as soon as the rain hit… The sales were just not there other than to teach a boy inspiration and give him the belief that he can make money… But on paper this business looked GREAT! Yours did too…
Selling is expensive
Most readers of this blog are producers; produce healthcare products, write software for healthcare and payment systems, or photographers and filmmakers. All actually do meaningful work for a living. What do sales guys and gals do for a living? Ask any real producer and you will hear, “Play golf, buy lunches, and drive me crazy…” Actually, it is “drive me crazy” that is worst answer. The real cost of a sales team is not their great salary, appalling commissions, or exorbitant expense accounts, it is bringing home bad business. There are two major categories of BAD sales people.; ones that go out to hunt and NEVER bring in any game, and ones that bring in ANY game (if it moves, it might be a prospect) Why do we tolerate it is because we want sales… Any by the way, the best sales people are also the ones that bring in unpredicted game. The real opportunity for growth is often the new application of the product into a vertical business that a lazy sales guy can just go sell one after another like dominos.. Good for him; and good for our company…
So what is hyper sales growth?
Hyper sales grow is more than exceeding the exponential curve of a sales plan. It is growing into a dominant or sustainable market leader in a profitable market in a very short period of time. In my last adventure we grew from 5 million dollars to $1.3 billion in three years. Two years later that revenue continues to stick and the company is profitable in one of the most competitive market segments of healthcare. It succeeded because we went to market with stakeholders that had something to gain and a message that resonated with our customers and channels.
Can it happen here in Texas?
Yes I personally believe it can. I returned to Texas after the adventure in Ohio. (That’s right, we were awarded the 2007 INC Magazine #1 fastest-growing privately-held company in Cleveland Ohio!) A third-generation Texan, I believe we can dominate segments of the technology industry. We have the talent, and more importantly, the spirit to create companies that are not the flawed dot-coms’ business models of the past, but are rather positioned for real value.
What’s next?
“Wisdom consists not so much in knowing what to do in the ultimate as knowing what to do next.” – Herbert Hoover
For me, it’s easy, I have returned and targeted Texas to live and work because I believe that there are opportunities for hyper growth in technology and/or healthcare here. I invite you to contact me here, if you or someone you know is poised for sustained growth. Contact me at Jim thefamousatsign jamesabrewer dadot com
And for you what’s next? That’s the real question. I hope that thinking about how your product will scale, how to create realistic sales plans, and how you might use others to carry your products flag have been fruitful.