Are you a start-up or scale-up?

Francesc Puigdemont / 22 Jan 2025 / 4 min

Maybe you are an entrepreneur and you haven't realized that your start-up has started to be a scale-up. Or maybe you are sensing it but you are not sure if it is really happening. Maybe you are a CEO and you have seen the need for your start-up to take a quantum leap and start to organize itself as a scale up. Or maybe you are an initial employee of a start-up and you are angry because your company is changing too fast. Or maybe you are a business angel and you think that one of your main start-ups is already becoming a scale-up, but you want it to accelerate its growth even more and thus multiply the value of your investment. This post is for you.

When a start-up begins to transition into becoming a scale-up, it is one of the most important and vital moments it will encounter on its path to becoming a future large, successful, profitable, and sustainable company. A scale-up is a company that has surpassed the initial start-up stage and is experiencing rapid and sustained growth, both in terms of revenue, customers, or employees. This term is used to describe companies that have demonstrated viability in their business model and are in the process of scaling their operations to expand their impact on the market. Realizing that your start-up, whether you are an entrepreneur, employee, or investor, is beginning this transition will be key to the company's success as well as your own personal success.

What are the key elements that will make you see that you are in the start-up / scale-up transition moment? 1) Your company has a proven, viable business model with a clear path to profitability. 2) You have achieved constant and accelerated growth, usually between 200%-300% annually in revenue for a period of 3 consecutive years, usually accompanied by sustained employee growth, geographic expansion, and a continuous launch of new products. 3) The startup has closed or is in a position to close Series B or C investment rounds. 4) You have a consolidated core team that only requires incorporating new signings into an already stable structure.

Okay, you are clear that your company is a scale-up and you are working non-stop to reach your goals. What are the challenges you will encounter? 1) Maintain the quality of the initial product that has led you to the first success, while scaling the company non-stop. We all imagine examples, is it the same challenge to make 100,000 smash burgers a year as it is to make 10M burgers? Clearly not, there is a challenge to maintain quality. 2) Start competing with companies larger than you and challenge them for leadership. Scale-ups always have competitors, whether new or traditional, with whom you will compete for customers, talent and investment. 3) Create, manage and administer the growth of the team and its impact on the company's values. The successful team of a start-up is not the same as that of a scale-up. When companies grow, they need more specialists in each of the areas. And they need to organize themselves into methodologies that can sustain continuous growth for months. Planning and execution will be key, and the challenges are enormous.

Finally, what are some of the best practices of scale-ups that come to mind (and that at Aticco we have some of the best in Europe)? 1) Standardize processes, that is, methodology, methodology, methodology. 2) Hire and retain talent. 3) Maintain quality, continue to focus on the customer. 4) Strengthen the organizational culture. 5) Scale the technology. 6) Financing management. 7) Anticipate the main risks, as far as possible.