Successful Venture Scaling – the Learning Series
While the success of corporate venture building is undeniable, a significant gap remains in guiding founders through the critical scaling stage. Recognising this, we have crafted a unique framework for venture scaling, distilled into an accessible and comprehensive book. This resource encapsulates decades of expertise in both corporate and independent venture building, offering a straightforward approach to scaling ventures alongside insights into all relevant business dimensions for scaling success. In a bid to share this knowledge widely, we're launching a series of more than 50 mini-blogs, each spotlighting a specific sub-dimension of these business dimensions. Whether you're seeking the full breadth of our scaling framework or wish to engage our experts directly, this series—and the book it draws from—provides the guidance you need for successful venture scaling.
Introduction to the Strategy Dimension
The first scaling framework dimension is strategy. This dimension sums up everything that gives your venture a longer-term perspective. Starting from the vision and leading to investor relations, the subdimensions of strategy are often the venture founders’ responsibility.
The topics in this chapter are unique; they are the only topics that must be known throughout your entire venture, from the beginning of the building phase to long after the scaling phase. They give direction and can unify your venture if prepared and communicated correctly. Make sure you plan for that communication part, maybe more than once. Your employees must understand the common goal everyone is working for.
The topics in this dimension are:
- Vision and Mission
- Strategy
- Value Proposition
- Market and Competition
- Business Model
- Business Plan
- Investor Relations
Investor Relations Detailed Discussion
Investors for ventures are unique. As the typical cap table is dominated by the investing corporation (25–99% of shares, most often >50%), it is not very likely to find ordinary startup investors, such as VCs. However, finding other corporations willing to invest in your venture is possible and likely. Ideally, look for someone who complements the abilities of your current corporate investor; this increases the likelihood of getting an agreement for such a deal from your leading investor. I strongly recommend finding an additional investor, as it will ease funding requests. The two investors will naturally compete to outbid each other to maximize their shares.
Funding is essential for the scaling phase. Standardization and automation are necessary prerequisites to scale your venture; hiring more personnel and continuous product development is also required. All these cost money, so you should plan an investment round for your scaling phase.
While this investment can come from a new or old investor, you must be prepared and professional about it. Plan for 6–12 months at least. Start by defining who you are looking for and draft a longlist. Now, create a highly professional pitch deck (use the Sequoia template you will find online and make it look beautiful!). Now, start contacting your longlist and drill it down to a shortlist. Draft a term sheet with at least two of them to create competition. Close the deal. One word of critical advice: You are the founder; you should be in the driver’s seat of this process; do not wait for your corporation to do this for you. Your most important job is to ensure you have the cash you need to run your business! It will be hard work, so best start right now.
Next Up
Maintaining robust investor relations is crucial for securing the financial support needed to scale effectively. For ventures seeking to refine their investor relations strategies or in need of expert guidance, our team is here to help. Reach out to explore how we can support your venture's strategic development and scaling efforts.
Stay tuned for our next piece in this series, where we will explore another critical dimension of venture scaling, equipping you with the knowledge and tools needed to navigate the complex landscape of venture building successfully.
