{"id":44573,"date":"2020-10-20T14:11:51","date_gmt":"2020-10-20T21:11:51","guid":{"rendered":"\/us\/en\/blog\/?p=44573"},"modified":"2025-06-27T01:00:04","modified_gmt":"2025-06-27T08:00:04","slug":"scaling-a-startup","status":"publish","type":"post","link":"\/us\/en\/blog\/scaling-a-startup\/","title":{"rendered":"How to successfully scale a startup: The fundamentals"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Growing pains are inevitable for most small businesses. At some point in your journey, your business will outgrow its former self.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">And pretty soon, you will face some very confusing forks in the road, like, whether to:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Grow your team and hire more, or stay small and nimble<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Raise capital or stay self-funded<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Stay in your niche or expand to new market horizons<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Acquire other startups\u2014or be acquired<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">When you\u2019re faced with such a dilemma, don\u2019t ignore your scaling opportunities\u2014and definitely don\u2019t let the mounting pressure of success crush your business.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Luckily, the problem of scaling up is always a \u201cgrowth problem.\u201d It\u2019s an opportunity for you to channel your challenges in the right direction and to expand your business\u2019s impact.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In this post, we will show you how exactly you should scale your business\u2014especially if you\u2019re a tech-based startup.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the sections below, we\u2019ll look at the following topics:<\/span><\/p>\n<ul>\n<li><a href=\"#what\">What should tech startups consider before scaling?<\/a><\/li>\n<li><a href=\"#four\">4 tips for scaling a tech startup<\/a><\/li>\n<li><a href=\"#three\">3 examples of tech startups that have scaled successfully<\/a><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">There are tons of blog posts written on the topic of how to scale your business, but most of them just leave you with vague tips\u2014seasoned generously with entrepreneurial platitudes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We&#8217;ll go a step further and illustrate these tips with examples from well-known tech startups that&#8217;ve scaled to new heights by taking certain bold steps.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Let\u2019s begin by discussing a few nuances that are specific to tech-based startups.<\/span><\/p>\n<hr \/>\n<p class=\"p1\">\ud83e\udd1d Is your tech startup&#8217;s team collaborating as effectively as it could be? What should you look out for before you start scaling in earnest?<\/p>\n<p class=\"p1\">\n<div class=\"download-form-widget standart-download-form\" data-url=\"https:\/\/netstorage.ringcentral.com\/documents\/checklist_for_startups.pdf\" data-id=\"69db97a92e324\" id=\"69db97a92e324\">\n\t\t<button tabindex=\"on\"  on=\"tap:69db97a92e324.toggleClass(class='open')\" class=\"open-modal-download-action download-form-button\" type=\"submit\">\ud83c\udf1f Download the checklist to find out<\/button><\/p>\n<div class=\"download-form-modal\">\n<div class=\"download-form-modal-body\">\n<div class=\"download-form-modal-content\">\n<div class=\"download-form-modal-title\">\ud83d\udc40 Get this free checklist to evaluate if your startup's current approach is working for you. <\/div>\n<form class=\"download-form SMB\" method=\"post\">\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<input class=\"download-form-input\" aria-label=\"Full Name\" aria-required=\"true\" aria-invalid=\"false\" type=\"text\" name=\"fullname\" placeholder=\"Full Name\" data-dl-events-hover=\"true\" data-dl-element=\"text\" data-dl-additional-info=\"download form\">\n\t\t\t\t\t\t<\/div>\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<input class=\"download-form-input\" aria-label=\"Email (please enter a work email address)\" aria-required=\"true\" aria-invalid=\"false\" type=\"email\" autocomplete=\"on\" name=\"email\" placeholder=\"Email (please enter a work email address)\" data-dl-events-hover=\"true\" data-dl-element=\"email\" data-dl-additional-info=\"download form\">\n\t\t\t\t\t\t<\/div>\n<div>\n\t\t\t\t\t\t\t<input type=\"hidden\" name=\"popup_form\" value=\"1\">\n\t\t\t\t\t\t<\/div>\n<div><input type=\"hidden\" name=\"Asset_ID__c\" value=\"ODAM-01420\" class=\"download-form-input\"><\/div>\n<div>\n\t\t\t\t\t\t\t<input type=\"hidden\" name=\"Lead_Entry_Source__c\" value=\"RC Blog\" class=\"download-form-input\"\/>\n\t\t\t\t\t\t<\/div>\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<button class=\"download-form-submit\" type=\"submit\" data-dl-element=\"button\" data-no-auto-dl=\"true\" data-dl-additional-info=\"download form\" data-dl-name=\"Get it now\">Get it now<\/button>\n\t\t\t\t\t\t<\/div>\n<\/p><\/form>\n<p> \t\t\t\t\t<button on=\"tap:69db97a92e324.toggleClass(class='open')\" role=\"button\" tabindex=\"0\"  class=\"download-form-modal-close\"><\/button>\n\t\t\t\t<\/div>\n<div class=\"download-form-modal-thank\">Enjoy! <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p>\n<hr \/>\n<h2><span style=\"font-weight: 400;\"><a id=\"what\"><\/a><br \/>\nWhat should tech startups consider before scaling?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">To start with, it\u2019s important to differentiate between growth and scaling.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Although they can be used interchangeably, there is a small difference.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Growth is when your business revenue is proportional to adding new resources to your business\u2014such as assets, technology, manpower, product features. Imagine a business that doubles its <a class=\"waffle-rich-text-link\" href=\"https:\/\/www.ringcentral.com\/contact-center.html\">contact center<\/a> staffing to match the growing demand for its product.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Scaling is a form of growth\u2014but without the extra frills. Companies \u201cscale\u201d when they grow their revenue exponentially <em>without<\/em> spending a lot on acquiring more resources\u2014which means they improve profit margins while keeping their costs low. (That&#8217;s why startups especially tend to be obsessed with <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/productivity-tips-for-startups\/\" target=\"_blank\" rel=\"noopener noreferrer\">productivity<\/a>. The goal is to have a higher output, while maintaining a relatively low input.)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Think of a rapidly growing business that\u2014instead of going on a hiring spree\u2014automates a large part of its <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/customer-support\/\" target=\"_blank\" rel=\"noopener noreferrer\">customer service<\/a> without raising costs:<\/span><\/p>\n<p><img decoding=\"async\" class=\"alignnone size-full wp-image-44574\" src=\"\/us\/en\/blog\/wp-content\/uploads\/2020\/10\/growth-vs-scaling.png\" alt=\"growth vs scaling\" width=\"624\" height=\"326\" \/><\/p>\n<p><span style=\"font-weight: 400;\">Just to clarify, we are not advocating one is better than the other. Growth and scaling are both equally valid pathways based on the end goal for your business.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The decision of whether to just grow or scale becomes easier when you figure out what\u2019s best for your business, your team, and your customers.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For the scope of this post, we will keep our focus on scaling because it\u2019s faster, cheaper, and more ambitious.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As a tech-based startup, there are a few other considerations you should be mindful of before scaling.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For instance, you have to make sure that you&#8217;ve found your product-market fit. Product-market fit means developing the right product and selling it to the relevant audience segment (it\u2019s a match made in heaven).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Achieving a product-market fit is initially tough, but knowing when you\u2019ve achieved it is pretty easy. When you find your product-market fit, your customer acquisition costs achieve a record low, and retaining your customers looks easy.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Trying to scale your business without having a product-market fit is a recipe for disaster. Why bother scaling if you haven\u2019t validated your product\u2019s demand first?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The story of Airware\u2014a now-defunct drone startup\u2014is a cautionary tale on why scaling isn\u2019t for everyone.<\/span><sup><span style=\"font-weight: 400;\">1<\/span><\/sup><span style=\"font-weight: 400;\"> (The short version of the story: Even after raising $118 million\u2014from big investors like Andreessen Horowitz, no less\u2014Airware just couldn&#8217;t find the right product-market fit\u00a0 for its drones.)<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The other consideration is to figure out if you have a predictable source of revenue. Having a steady flow of revenue validates that your business has achieved the product-market fit and that it\u2019s ready to scale.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is especially true if you\u2019re thinking of attracting investors to fund your company\u2019s growth\u2014a common technique for scaling. The #1 thing that most venture capitalists look for in a company they want to invest in is\u2014how predictable is your sales engine.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Investors are like risk-averse gamblers\u2014they want to bet on startups that can show them the money. They will only invest in your startup if you can show them your company\u2019s financial health, your product\u2019s stability, and the potential to scale.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If your tech startup is still figuring out things, hasn\u2019t found its ideal market yet, or doesn\u2019t have a predictable sales pipeline\u2014then scaling is probably not the best strategy for you right now.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the next sections, we will discuss examples and explore some more tips in detail on how to scale tech startups.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\"><a id=\"four\"><\/a><br \/>\n4 tips for scaling a tech startup<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Here are four tips on how to scale a tech startup. (More on these in the company examples below.)<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">1. Automate, streamline, and outsource<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Scaling up means getting rid of the excess baggage that holds you down. Think of all the manual processes that made sense when you were a 10-member team, the approval cycle that takes four days to complete, or the communication overload that slows down your already-bogged-down team.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">They all need to get booted if you&#8217;re serious about scaling.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So what&#8217;s the answer? You can either automate, streamline, or outsource the redundancies to improve your operational efficiency. In other words, identify the best tools for you to scale without disrupting your startup\u2019s growth.<\/span><\/p>\n<p>For example, one of the easiest things you can do is to streamline the tools you&#8217;re using. Are you using <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/best-video-conferencing-for-small-businesses\/\" target=\"_blank\" rel=\"noopener noreferrer\">one tool for video conferencing<\/a>, another for <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/best-file-sharing-app\/\" target=\"_blank\" rel=\"noopener noreferrer\">file sharing<\/a>, <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/instant-messaging-programs\/\" target=\"_blank\" rel=\"noopener noreferrer\">another for team messaging<\/a>, and so on? Instead of paying for many disparate tools, why not save money\u00a0and your team&#8217;s valuable time by using\u00a0<em>fewer\u00a0<\/em>tools that are more versatile?<\/p>\n<p>The RingCentral desktop and mobile app, for instance, gives you messaging, <a href=\"https:\/\/www.ringcentral.com\/video-call.html\">video call<\/a>, and phone (and more)\u2014all in one place:<\/p>\n<div class=\"rc_custom_video\"><a class=\"rc_custom_video__link\" href=\"https:\/\/www.youtu.be\/EbIAZJd9rCU\">\n\t\t            <picture><source srcset=\"https:\/\/i.ytimg.com\/vi_webp\/EbIAZJd9rCU\/maxresdefault.webp\" type=\"image\/webp\"><img decoding=\"async\" class=\"rc_custom_video__media\" src=\"https:\/\/i.ytimg.com\/vi\/EbIAZJd9rCU\/maxresdefault.jpg\" alt=\"\">\n\t\t            <\/picture>\n\t\t        <\/a><br \/>\n\t\t        <button class=\"rc_custom_video__button\" aria-label=\"Play video\"><svg width=\"68\" height=\"48\" viewBox=\"0 0 68 48\"><path class=\"rc_custom_video__button-shape\" d=\"M66.52,7.74c-0.78-2.93-2.49-5.41-5.42-6.19C55.79,.13,34,0,34,0S12.21,.13,6.9,1.55 C3.97,2.33,2.27,4.81,1.48,7.74C0.06,13.05,0,24,0,24s0.06,10.95,1.48,16.26c0.78,2.93,2.49,5.41,5.42,6.19 C12.21,47.87,34,48,34,48s21.79-0.13,27.1-1.55c2.93-0.78,4.64-3.26,5.42-6.19C67.94,34.95,68,24,68,24S67.94,13.05,66.52,7.74z\"><\/path><path class=\"rc_custom_video__button-icon\" d=\"M 45,24 27,14 27,34\"><\/path><\/svg><br \/>\n\t\t        <\/button>\n\t\t    <\/div>\n<p><span style=\"font-weight: 400;\">There are loads of other possibilities. Whether it&#8217;s your <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/best-customer-service-software\/\" target=\"_blank\" rel=\"noopener noreferrer\">customer service software<\/a>\u00a0or <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/cold-calling-software\/\" target=\"_blank\" rel=\"noopener noreferrer\">cold calling softwar<\/a>e, always look for opportunities to reduce the technology bulk that your team is using. Time is your most precious resource. Do you want to spend it on low-value tasks like learning and managing a bunch of different tools, or do you want to spend it on valuable activities that directly translate to growth?<\/span><\/p>\n<hr \/>\n<p class=\"p1\">Learn more about how tech startups are using RingCentral features such as <a href=\"https:\/\/www.ringcentral.com\/lp\/small-business-phone-service.html\">business phone service<\/a>, <a href=\"https:\/\/www.ringcentral.com\/virtual-call-center.html\">virtual call center<\/a>, <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/what-is-an-omnichannel-cloud-contact-center\/\">omnichannel contact center<\/a> and <a href=\"https:\/\/www.ringcentral.com\/ccaas.html\">CCaaS<\/a> to collaborate more effectively with distributed teams and keep customers happy.<\/p>\n<p class=\"p1\">\n<div class=\"download-form-widget standart-download-form\" data-url=\"https:\/\/netstorage.ringcentral.com\/brief\/startup_innovation.pdf\" data-id=\"69db97a92e45b\" id=\"69db97a92e45b\">\n\t\t<button tabindex=\"on\"  on=\"tap:69db97a92e45b.toggleClass(class='open')\" class=\"open-modal-download-action download-form-button\" type=\"submit\">\ud83c\udf1f Download the solution brief<\/button><\/p>\n<div class=\"download-form-modal\">\n<div class=\"download-form-modal-body\">\n<div class=\"download-form-modal-content\">\n<div class=\"download-form-modal-title\">\ud83d\udc40 Get this free solution brief to evaluate if RingCentral might be a good fit for your startup. <\/div>\n<form class=\"download-form SMB\" method=\"post\">\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<input class=\"download-form-input\" aria-label=\"Full Name\" aria-required=\"true\" aria-invalid=\"false\" type=\"text\" name=\"fullname\" placeholder=\"Full Name\" data-dl-events-hover=\"true\" data-dl-element=\"text\" data-dl-additional-info=\"download form\">\n\t\t\t\t\t\t<\/div>\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<input class=\"download-form-input\" aria-label=\"Email (please enter a work email address)\" aria-required=\"true\" aria-invalid=\"false\" type=\"email\" autocomplete=\"on\" name=\"email\" placeholder=\"Email (please enter a work email address)\" data-dl-events-hover=\"true\" data-dl-element=\"email\" data-dl-additional-info=\"download form\">\n\t\t\t\t\t\t<\/div>\n<div>\n\t\t\t\t\t\t\t<input type=\"hidden\" name=\"popup_form\" value=\"1\">\n\t\t\t\t\t\t<\/div>\n<div><input type=\"hidden\" name=\"Asset_ID__c\" value=\"ODAM-01421\" class=\"download-form-input\"><\/div>\n<div>\n\t\t\t\t\t\t\t<input type=\"hidden\" name=\"Lead_Entry_Source__c\" value=\"RC Blog\" class=\"download-form-input\"\/>\n\t\t\t\t\t\t<\/div>\n<div class=\"download-form-part\">\n\t\t\t\t\t\t\t<button class=\"download-form-submit\" type=\"submit\" data-dl-element=\"button\" data-no-auto-dl=\"true\" data-dl-additional-info=\"download form\" data-dl-name=\"Get it now\">Get it now<\/button>\n\t\t\t\t\t\t<\/div>\n<\/p><\/form>\n<p> \t\t\t\t\t<button on=\"tap:69db97a92e45b.toggleClass(class='open')\" role=\"button\" tabindex=\"0\"  class=\"download-form-modal-close\"><\/button>\n\t\t\t\t<\/div>\n<div class=\"download-form-modal-thank\">Enjoy! <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p>\n<hr \/>\n<h3><span style=\"font-weight: 400;\">2. Make customer retention your top priority<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Acquiring more customers is a no-brainer when you\u2019re just starting up, but retention is where your focus should be when you\u2019re scaling up.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Customer retention makes sense because it keeps your acquisition costs low while boosting profit. Retention also builds customer loyalty and helps you build a predictable revenue engine.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you\u2019re a startup in the subscription-based SaaS (software as a service) industry, for example, improving your subscription renewal will help you compound your growth.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But how do you <\/span><a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/customer-retention\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">improve customer retention<\/span><\/a><span style=\"font-weight: 400;\">?\u00a0<\/span><span style=\"font-weight: 400;\">When you&#8217;re growing as a company, you need to keep tabs on what people say about your brand or when customers need support from you. But how can you keep track of all the conversations happening across all those different social media channels?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Take <\/span><a href=\"https:\/\/www.ringcentral.com\/digital-customer-engagement.html\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">RingCentral Engage Digital\u2122<\/span><\/a><span style=\"font-weight: 400;\"> for instance. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">RingCentral Engage Digital helps you cut your support overhead by helping your <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/customer-service-tech-startups\/\" target=\"_blank\" rel=\"noopener noreferrer\">customer service<\/a> team manage customer interactions across all digital channels through a single interface. Here&#8217;s a quick look at how it works:<\/span><\/p>\n<div class=\"rc_custom_video\"><a class=\"rc_custom_video__link\" href=\"https:\/\/www.youtu.be\/PZC3o5YN90E\">\n\t\t            <picture><source srcset=\"https:\/\/i.ytimg.com\/vi_webp\/PZC3o5YN90E\/maxresdefault.webp\" type=\"image\/webp\"><img decoding=\"async\" class=\"rc_custom_video__media\" src=\"https:\/\/i.ytimg.com\/vi\/PZC3o5YN90E\/maxresdefault.jpg\" alt=\"\">\n\t\t            <\/picture>\n\t\t        <\/a><br \/>\n\t\t        <button class=\"rc_custom_video__button\" aria-label=\"Play video\"><svg width=\"68\" height=\"48\" viewBox=\"0 0 68 48\"><path class=\"rc_custom_video__button-shape\" d=\"M66.52,7.74c-0.78-2.93-2.49-5.41-5.42-6.19C55.79,.13,34,0,34,0S12.21,.13,6.9,1.55 C3.97,2.33,2.27,4.81,1.48,7.74C0.06,13.05,0,24,0,24s0.06,10.95,1.48,16.26c0.78,2.93,2.49,5.41,5.42,6.19 C12.21,47.87,34,48,34,48s21.79-0.13,27.1-1.55c2.93-0.78,4.64-3.26,5.42-6.19C67.94,34.95,68,24,68,24S67.94,13.05,66.52,7.74z\"><\/path><path class=\"rc_custom_video__button-icon\" d=\"M 45,24 27,14 27,34\"><\/path><\/svg><br \/>\n\t\t        <\/button>\n\t\t    <\/div>\n<p><span style=\"font-weight: 400;\">Check out how companies like <\/span><a href=\"https:\/\/www.ringcentral.com\/whyringcentral\/casestudies\/orange-group.html\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">Orange<\/span><\/a><span style=\"font-weight: 400;\"> and <\/span><a href=\"https:\/\/www.ringcentral.com\/whyringcentral\/casestudies\/ooredoo.html\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">Ooredoo<\/span><\/a><span style=\"font-weight: 400;\"> are using the RingCentral Engage Digital platform to manage their digital customer service at scale.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It\u2019s easier said than done, but you have to start by <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/saas-customer-support\/\" target=\"_blank\" rel=\"noopener noreferrer\">prioritizing great customer support<\/a>, emphasizing team relationships, <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/return-customer\/\" target=\"_blank\" rel=\"noopener noreferrer\">offering customers a reason to return<\/a>, and keeping your ears to the ground. And once your <a href=\"https:\/\/www.ringcentral.com\/us\/en\/blog\/customer-retention-rate\/\" target=\"_blank\" rel=\"noopener noreferrer\">customer retention<\/a> improves, it&#8217;ll help you fight churn, improve your brand advocacy, lower your support costs\u2014and scale to your highest potential.<\/span><\/p>\n<hr \/>\n<p class=\"p1\"><span class=\"s1\">\ud83d\udd79\ufe0f<\/span> Get a hands-on look at how RingCentral can work for your startup by booking a product tour:<\/p>\n<p class=\"p1\"><button data-href=\"#leadform-popup\" class=\"js-open-popup-activator btn primary\" >Choose a time<\/button><\/p>\n<hr \/>\n<h3><span style=\"font-weight: 400;\">3. Raise capital<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Startups love the sound of money\u2014especially if it helps them move up and grow fast.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Raising funds is a quick way to attract the best talent, diversify your product\u2019s strengths, boost your marketing and sales, and leave a bigger footprint in the world.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">There are several ways to raise funds for your startup\u2014raising seed capital from friends and family members, asking angel investors to invest in your company, or taking bank or credit card loans to fund your growth.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Just be sure that you do your homework before seeking funds for your startup. Ask yourself how much capital you want to raise, what will you do after raising the required funds, and if you\u2019re okay letting go of the control you might have on your startup when you invite investors to own a part of your business.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">4. Hire\u2014and fire\u2014judiciously<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">A common myth in the tech startup circles is that you need to hire slowly and fire quickly when you are scaling.<sup>2<\/sup><\/span><\/p>\n<p><span style=\"font-weight: 400;\">We suggest you brush off such advice because it\u2019s a half-baked, dismissive, and downright dangerous idea to believe in.<\/span><sup><span style=\"font-weight: 400;\">3<\/span><\/sup><\/p>\n<p><span style=\"font-weight: 400;\">Scaling also means employing more people, building a favorable perception of your brand, and building a company that boosts the economy. You can\u2019t hit those goals if you were to fire your employees just because some Silicon Valley gurus said so.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Instead\u2014be more judicious with your hiring, people management, and firing as much as possible. Hire the best people so that you don\u2019t have to fire them later.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Don\u2019t hire talents with an intention to fire later. Remember that your goal is to keep costs low while increasing profit\u2014which means the margin for error is very minimal.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\"><a id=\"three\"><\/a><br \/>\n3 examples of tech startups that have scaled successfully<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The examples below showcase the out-of-the-box creativity that you need to apply in your business when scaling a tech startup.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">1. Pinterest<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">When Pinterest launched in March 2010 as a one-of-its-kind image-sharing website, very few people were interested in what the platform had to offer.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But Pinterest grew from getting zero to a billion page views in just two years thanks to the brilliant marketing it applied in growing its product. Here\u2019s how they pulled it off.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In their early days, Pinterest founders marketed their website as an invite-only platform and hosted local meetups. This gave them a chance to understand their ideal customer persona (ICP) better\u2014artistically inclined people like handicraft makers, bakers, and crocheters who wanted to express themselves through an online visual platform.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In addition to its already existing marketing team, Pinterest set up a new \u201cgrowth team\u201d with a super-specific objective to increase the number of monthly active users (MAUs).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As their word-of-mouth marketing grew, the company applied some clever growth hacking techniques to open the platform for new market segments like part-time hobbyists, social media users, and brand marketers.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The company rolled out a new feature to allow users to sign in through their Facebook account\u2014a brilliant move at the time because, in 2010, Facebook had hundreds of million more active users than Pinterest did.<\/span><sup><span style=\"font-weight: 400;\">4<\/span><\/sup><\/p>\n<p><span style=\"font-weight: 400;\">This worked as a low-cost, but very powerful marketing channel for Pinterest to scale its user base. Whenever people logged in to Pinterest through their Facebook account, they would see a bunch of connections from Facebook already on the platform.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It reinforced their liking for the platform and gave them reasons to explore the platform further\u2014increasing user engagement and product adoption.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This technique got Pinterest massive traction\u2014like attracting 40,000 unique visitors to their website in August 2010\u2014which was significant for them at the time.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Pinterest also made it easy for users to share their \u201cPins\u201d and \u201cboards\u201d to their network of friends on Facebook, which incentivized other Facebook users to try Pinterest.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">On the team front, Pinterest made a strategic decision for its growth team to report to the product team instead of the marketing team. This helped them cut a lot of redundancies in their internal process, align their goals better, and execute faster.<\/span><sup><span style=\"font-weight: 400;\">5<\/span><\/sup><\/p>\n<p><span style=\"font-weight: 400;\">In 2012, Pinterest cashed on its rising company valuation to raise multiple rounds of funding\u2014$100-million Series C at a $1.5 billion valuation, $225 million Series E at a $3.8 billion valuation, and $553 million Series G at an $11 billion valuation:<\/span><\/p>\n<p><a href=\"https:\/\/marketingland.com\/pinterest-shopping-ads-gain-momentum-as-company-revenues-top-1-billion-in-2019-275596\" target=\"_blank\" rel=\"noopener noreferrer\"><img decoding=\"async\" class=\"alignnone size-full wp-image-44575\" src=\"\/us\/en\/blog\/wp-content\/uploads\/2020\/10\/pinterest-monthly-active-user-growth.png\" alt=\"pinterest monthly active user growth\" width=\"700\" height=\"439\" \/><\/a><\/p>\n<p><span style=\"font-weight: 400;\">Owing to its rapid growth and popularity, Pinterest opened its initial public offering (IPO) in April 2019 at a $10 billion valuation\u2014raking millions of dollars for its founders, key stakeholders, and many of the early employees.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Right now, the company is worth $26.19 billion in market valuation<\/span><sup><span style=\"font-weight: 400;\">6<\/span><\/sup><span style=\"font-weight: 400;\"> and has 335 million monthly active users globally.<\/span><sup><span style=\"font-weight: 400;\">7<\/span><\/sup><\/p>\n<p><b>The takeaway:<\/b><span style=\"font-weight: 400;\"> One key to scaling your business is to understand your customers inside out. Pinterest\u2019s interest in getting to know its power users helped them come up with the right product features and leverage the right channels (i.e., Facebook) for growth.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">2. Amazon<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">In 2018, LinkedIn co-founder Reid Hoffman in a book that he co-authored coined the term <\/span><b><i>blitzscaling<\/i><\/b><span style=\"font-weight: 400;\"> for companies that scale up \u201cat a dizzying pace that blows competitors out of the water.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">And if there\u2019s one company that fits the perfect definition of blitzscaling, it\u2019s Amazon.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Jeff Bezos quit his full-time job to start Amazon in 1994 after he read a report that predicted the internet will grow by 2,300% every year.<\/span><sup><span style=\"font-weight: 400;\">8<\/span><\/sup><\/p>\n<p><span style=\"font-weight: 400;\">From those humble days of being an online bookstore startup, Amazon has continuously leveraged its \u201cflywheel effect\u201d to chart its course as a mega \u201cscaleup.\u201d<\/span><span style=\"font-weight: 400;\">7<\/span><\/p>\n<p><span style=\"font-weight: 400;\">From its early days, Amazon also took a unique spin in developing its product. Instead of building a product or a feature first and finding the right customers for it later, the product development teams at Amazon worked backward to identify the customer problems first and then develop a product or feature to solve them.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This is the reason why Amazon has found success with its products like the Kindle e-reader, Amazon Alexa, and Amazon Web Services (AWS).<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Amazon\u2019s hiring masterstroke was to retain the C suite talents from companies that it acquired. For example, Bezos kept Mike George when Amazon acquired George\u2019s former employer Junglee in 1998. Since then, George has gone on to lead Amazon\u2019s Marketplace, Echo, Alexa, and Appstore and is one of Bezos\u2019 closest advisors.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Amazon\u2014named after the vast South American jungle\u2014is the best example of a scale-up company that wants to grow in all possible directions.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Here\u2019s what Amazon\u2019s aggressive scaling and expansion strategy looks like across industries:<\/span><\/p>\n<p><a href=\"https:\/\/finshots.in\/infographic\/amazon-is-at-war-with-everyone\/\" target=\"_blank\" rel=\"noopener noreferrer\"><img decoding=\"async\" class=\"alignnone size-full wp-image-44576\" src=\"\/us\/en\/blog\/wp-content\/uploads\/2020\/10\/amazon-growth-chart.jpg\" alt=\"amazon growth chart\" width=\"700\" height=\"700\" \/><\/a><\/p>\n<p><span style=\"font-weight: 400;\">Today, the company towers at a $1 trillion valuation,<sup>9<\/sup><\/span><span style=\"font-weight: 400;\"> has the world\u2019s second-best paid membership program (after Netflix),<\/span><sup><span style=\"font-weight: 400;\">10<\/span><\/sup><span style=\"font-weight: 400;\"> and employs more than 935,000 people worldwide.<\/span><sup><span style=\"font-weight: 400;\">11<\/span><\/sup><\/p>\n<p><b>The takeaway:<\/b><span style=\"font-weight: 400;\"> Scaling is a continuous process with no end in sight\u2014and a large part of it depends on the quality of hires you bring in to help your company grow.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Amazon is still growing strong, mostly thanks to the standard of people it hires to fuel its growth.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">3. Airbnb<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Airbnb started out in 2007 in San Francisco as a ripoff of Craigslist\u2014America\u2019s favorite classified ads website.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Over the years, Airbnb scaled from being a three-member bed-and-breakfast booking website to become the world\u2019s largest vacation rental marketplace because it danced to a different tune of business growth.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Like Pinterest\u2019s founders, Airbnb founders went door to door during their initial years to meet local house owners and convinced them to rent their houses as Airbnb hosts.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This not only gave them an opportunity to identify their target market better but also gained insights on how to improve their product experience for prospective customers.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This might sound like a counterintuitive exercise to scaling, but most tech startup geniuses like Reid Hoffman<\/span><sup><span style=\"font-weight: 400;\">12<\/span><\/sup><span style=\"font-weight: 400;\"> and Paul Graham<\/span><sup><span style=\"font-weight: 400;\">13<\/span><\/sup><span style=\"font-weight: 400;\"> agree that doing things that <\/span><i><span style=\"font-weight: 400;\">don\u2019t<\/span><\/i><span style=\"font-weight: 400;\"> scale during your initial startup years sets the stage for scaling your business to greater heights.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Airbnb knew that they were a more polished version of Craigslist with the exact same user persona, but they didn\u2019t have as massive a user base as the latter.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">So instead of trying to come up with a unique selling proposition (USP) to beat the incumbent\u2014which would have been a painfully slow and difficult attempt\u2014Airbnb offered its users an opportunity to repost their property ads on Craigslist as well, pitching them the lure of earning more.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">How did the company do this? They built a bot to crawl Craigslist&#8217;s bed-and-breakfast subdomains, copy the ad listings\u2019 URLs, input the listing information, and forwarded the URLs to the respective users for publishing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Here\u2019s an example of the email Airbnb sent to its users to coax them to use Craigslist:<\/span><\/p>\n<p><a href=\"https:\/\/growthhackers.com\/growth-studies\/airbnb\" target=\"_blank\" rel=\"noopener noreferrer\"><img decoding=\"async\" class=\"alignnone size-full wp-image-44577\" src=\"\/us\/en\/blog\/wp-content\/uploads\/2020\/10\/craigslist-airbnb-ad.png\" alt=\"craigslist airbnb ad\" width=\"472\" height=\"252\" \/><\/a><\/p>\n<p><span style=\"font-weight: 400;\">Once new customers discovered Airbnb via Craigslist, they fell in love with the aesthetically pleasing property photos, personalized product experience, attractive rates\u2014all of which made them come back to Airbnb for their next vacation booking.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This technique boosted Airbnb\u2019s user acquisition by thousands and scaled its user base quickly at almost no significant cost.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But what goes around, usually comes around. Airbnb was so heavily focused on its US market that in 2011, the company got a taste of its own medicine when they faced business threats from a European company that was cloning their business.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The threat was real since the copycat company had recently received a $90 million in funding and grew to 400 employees in just two months.<\/span><sup><span style=\"font-weight: 400;\">14<\/span><\/sup><\/p>\n<p><span style=\"font-weight: 400;\">Airbnb quickly moved to action and bought top-level website domains for nine countries in Europe, set up a global translation team, and revamped its website\u2019s payment page to accept international payments.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">They also bought two smaller companies that operated in the same domain in Germany and the UK.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In just over three months, Airbnb launched its international service with fully translated website pages and employed public relations tactics to gain press coverage.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Airbnb\u2019s quick-thinking strategy to fight the competition as soon as they appeared helped the company scale its international operations and gain over 227,093 listings in 14 cities by 2016\u2014with over 65,000 bookings in top European destinations like Paris.<\/span><span style=\"font-weight: 400;\">14<\/span><\/p>\n<p><b>The takeaway:<\/b><span style=\"font-weight: 400;\"> There\u2019s so much to pick from Airbnb\u2019s scaling-up story. First, do things that don\u2019t scale to understand your user base better.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Second, don\u2019t be shy to ride on the coattails of your competition if it doesn\u2019t breach business ethics or if it\u2019s a smart and quick way to grow your business.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">And lastly, when you face competition\u2014move faster than your rivals to assert your market dominance.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">To scale a tech startup, sometimes you have to break the mold<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Most tech startups scale when they start gaining good traction for their products. This is the key to knowing when you should scale\u2014when your existing processes start feeling small, when your customers expect more from you, and when you discover new potentials on the horizon.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Scaling a tech startup is all about shedding your old, tight-fitting processes to find more suitable avenues for your growth.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Apply the tips mentioned above to successfully scale your tech startup when you realize that you can no longer ignore the growth opportunities in front of you.<\/span><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<hr \/>\n<p><span style=\"font-weight: 400;\"><sup>1<\/sup>techcrunch.com\/2018\/09\/14\/airware-shuts-down<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>2<\/sup>inc.com\/bubba-page\/5-reasons-to-hire-slow-and-5-reasons-to-fire-fast.html<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup> 3<\/sup>fastcompany.com\/40461294\/this-is-why-slow-to-hire-and-quick-to-fire-is-bad-advice<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>4<\/sup>growthdevil.com\/pinterest-get-so-big<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>5<\/sup>medium.com\/@sarahtavel\/five-lessons-from-scaling-pinterest-6a699a889b08<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>6<\/sup>macrotrends.net\/stocks\/charts\/PINS\/pinterest\/market-cap<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>7<\/sup>investor.pinterestinc.com\/press-releases\/press-releases-details\/2020\/Pinterest-Announces-Fourth-Quarter-and-Full-Year-2019-Results\/default.aspx<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>8<\/sup>inc.com\/darren-marble\/jeff-bezos-quit-his-job-at-30-to-launch-amazon-heres-how-to-know-if-its-right-time-for-your-big-move.html<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>9<\/sup><\/span><span style=\"font-weight: 400;\">markets.businessinsider.com\/news\/stocks\/amazon-4q-earnings-stock-price-jumps-valuation-tops-trillion-beat-2020-1-1028863496#<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>10<\/sup>bloomberg.com\/graphics\/2019-amazon-reach-across-markets\/<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>11<\/sup>geekwire.com\/2020\/amazon-tops-935k-employees-week-pandemic-driven-hiring-spree-continues\/<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>12<\/sup>medium.com\/@reidhoffman\/how-to-scale-a-magical-experience-4-lessons-from-airbnbs-brian-chesky-eca0a182f3e3<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>13<\/sup>paulgraham.com\/ds.html<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>14<\/sup>medium.com\/@jgolden\/lessons-learned-scaling-airbnb-100x-b862364fb3a7<\/span><\/p>\n<p><span style=\"font-weight: 400;\"><sup>15<\/sup>businesstravel.fr\/images\/pdf\/etude-airbnb2016coyle.pdf<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Growing pains are inevitable for most small businesses. At some point in your journey, your business will outgrow its former self. And pretty soon, you will face some very confusing forks in the road, like, whether to: Grow your team and hire more, or stay small and nimble Raise capital or stay self-funded Stay in &#8230;<\/p>\n","protected":false},"author":29,"featured_media":43511,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[17901,18722],"tags":[24016,24015,24014,556],"class_list":["post-44573","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-leadership","category-startups","tag-growing-a-tech-startup","tag-high-tech","tag-scaling-a-tech-startup","tag-startups"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v19.3 (Yoast SEO v27.2) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>How to successfully scale a startup: The fundamentals | RingCentral Blog<\/title>\n<meta name=\"description\" content=\"Learn 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