Interactive resources for incubators and accelerators
Interactive resources for incubators and accelerators
Interactive resources for incubators and accelerators

FI Guide

Before You Scale

This section explores the different strategic drivers that determine what you are actually scaling and why. It then considers the different pathway option for scaling and what they will mean for you, your team and your programs. It also provides some practical approaches to assessing your organisation’s readiness to scale and replicate what you do.

Strategic Drivers - Why and What Are We Scaling?

The world needs you to scale as we work towards the Sustainable Development Global Goals. Our work is vital in helping to scale up the number of organisations that are working towards these targets that are going to keep our societies and our planet healthy.

We are trying to shift economies towards being more inclusive or impact economies. Our work needs to make sure that more organisations are trading with triple bottom line thinking – people, profit, planet – and have this money put towards working for impact.

  • If you’re doing something good, you have a responsibility to share it.

     

     Mel Young, Homeless World Cup

Defining Scale: Key Concepts

Moving from a phase for you in your accelerators where you’ve been through start-up for maybe more than 2 years in, has innovated some programs, serving a need that you’ve spotted, prototyped your model and are refining things, achieved market entry and you’re gaining traction with key stakeholder, cohorts and people in the ecosystem.

Once you’re done with that, we’re going to growth. We’re going to take what you’ve already done and look at how that can be replicated or build upon or done in a new pace/markets. We’ll look at building your teams and also at how you can monetise your systems or “impatise” them – a phrase where we create yet more impact from doing the same stuff.

Practical Tip

A bankers’ mantra says that:

“Turnover is vanity,
Profit is sanity,
Cash is reality”

+ Impact is… necessity

What Are We Scaling?

  • What is your vision for scale at the other end of your journey?
  • Is it local or global?
  • What are the principles and values that you’re using to guide your decision-making on that vision?
  • What are your drivers for wanting to scale?
  • Are you creating Unicorns or Zebras in your cohorts?
  • Or are you about doing a good quality job for communities you are serving in?

What is a Sustainable Scale for You?

Certain organisations and their models need to achieve a certain size to achieve economies of scale.

Some questions to check on your motivation and drivers:

  • Does your team have a clear diagnosis of the opportunity or challenge?
  • Are you trying to grow your turnover just to sustain your current operation and make sure that everyone gets paid well?
  • Are you looking at greater profitability for building reserves and making sure you stay strong?
  • Are you trying to meet demand and need to deliver more activity? Where will the funds come from?
  • Are you looking to create more impact in an area of significant need? What is that strategy?

The aim of the questions is to align with your organisation internally, ensure that you’re measuring the right indicators and what matters, and that all decisions flow and keep stakeholders close to us.

Reflection

Rules of the journey start with what we’re trying to achieve and it means we can stay focused on what we are going to do.

Pathways to Scale: Options, Vision and Opportunity

Once you’ve figured out your drivers, we will look at the different options and pathways for how we can scale.

We’ve worked out our business model and we’re flying along and we’re doing okay standing out. There are different ways to scale but note that you should not rush into different ones.

If you’ve figured out a good model that has strategic advantage or an asset that is really working, there may be value in replicating that once we’ve figured that out and people may pay to license in order to accelerate.

Practical Tip

It is worth considering with your team how best you can maximise what you are doing, how can you maximise your current sales and only then diversify or replicate.

Path to Scale: Finance and Impact

  • 01.

    Optimise (costs/processes)

    What you’re currently doing in order to make yourselves more profitable/efficient. A great place to start.

  • 02.

    Maximise sales

    Do you have a good Sales and Business Development practice? Have you maximised all your opportunities for selling your current products?

  • 03.

    Diversification / replication

    It is often tempting as entrepreneurs to think of the next thing, the next business idea but diversification can build on what we already have, it could extend our brand or bring in a new income stream that is essential to something that’s not quite working.

     

    You could integrate it back to your original business and gain economies of scale and get an advantage from that.

Market Strategies

  • Market penetration

    With the products you’ve already developed, can you achieve scale by going for market penetration in the areas you are already in?

  • Market development

    If you have a suite of products that you are spotting demand from different geographic areas and have new customer segments you can ship out to in market development terms.

  • Product development

    If you have a good product but can be building more by listening to the needs of your customers and a product development strategy might extend your brand into other things. This would make you more sustainable without having to shift out of the current market you just starting to get established in.

  • Diversification

    Diversification of new products into new markets which may be a strategy to bring in new income streams that you have looked in your financial sustainability modules. This can also be a distraction and high risk in your current business model.

    For example, running an accelerator and diversifying into co-working.

Scaling Strategies

1. How effective do you collaborate with others or do you want to collaborate with others?

2. How adaptable is your model/brand and what you are doing?

A framework for different options for different approaches to spreading your models.

  • Grow your organisation / Capacity building

    If you prefer to stay in your area and are not into collaborating with others beyond partnering on a bid/funding bid, and you’ve got a static model that does one thing really well, and growing your organisation and building your own capacity is not a bad strategy. Keep it simple.

  • Expand to New Sites

    If you’re not looking to collaborate too much but you can adapt to new areas, build your team then expanding to new sites can be another way.

  • Knowledge Diffusion / Licensing

    If you have a really, really good product and you can collaborate with others then sharing out your knowledge through licensing/other creative commons style → good way to spread the impact really fast by working with others.

  • Social Franchising / Joint Venture

    If you believe adapting and collaborating with others is the way to go, then social franchising/joint ventures become options in that mix.

    You may want to consider strategic partnerships or a consortium where you partner with other organisations to bid and win funds.

Key Concepts

During your scaling journey, you become more proficient as you meet new challenges.

At each stage you scale by becoming:

  • 01.

    Sales-ready

    Having original products and the facilitator network set up.

  • 02.

    Procurement-ready

    Being able to tender and bid successfully for government contracts.

     

  • 03.

    Investment-ready to replicate and scale

    Using money to become replication ready and to get your systems sorted out. Looking at what sort of model you could be using for going international.

  • 04.

    Export and International Procurement Replication Ready

Practical Tip

To do this, you may need to get investment at different points of time throughout the life cycle of your incubator or accelerator’s growth.

 

How can you ensure that funding will stay consistent?

 

By keeping investors and strategic partners close, ensures that you are constantly building and solidifying relationships with your funders, which in turn, makes them want to keep investing in your work.

CASE STUDY

Replication of the Social Enterprise Academy

  • 1.

    In the past six years, Social Enterprise Academy has replicated its model all around the world.

    This has been achieved through a number of key considerations and activities:

  • 2.

    1. Establishing a focused business model of Learning and Development

  • 3.

    2. Establishing a revenue model of ‘Fee for Service’ and ‘Buying on Behalf of’

  • 4.

    3. Developing a suite of adaptive programming

  • 5.

    4. Consistently monitoring and measuring their impact on behaviour change

  • 6.

    5. Creating a financial model and developing that model to suit the market over time

  • 7.

    6. Targeting a range of stakeholders and customers to ensure viability

  • 8.

    7. Identifying their strategic drivers for growth and analysing the opportunities available to them.

  • 9.

    8. Planning out different growth scenarios and phases to test what kinds of replication was possible.

  • 10.

    9. Building their team in Scotland over time in response to contract wins.

  • 11.

    10. Changing the structure of their organisation from functional to divisional to matrix to accommodate their growth.

  • 12.

    Source: Social Enterprise Academy

Strategic Global Partnerships

In order to create and run a social license model, you’ll  have to be able to put it in local hands and operate as a social license network globally, sharing ideas and knowledge and leveraging on a bank of products that they have innovated and shared together.

Replication Readiness Assessment

This is an internal assessment of how sustainable you are right now and with this, you will also be able to check on your operations. This gives you a triple-bottom-line viewpoint. It can also help you figure out where the issues are and where are you strong/weak. This helps you analyse overall if your scaling journey will help improve your current sustainability or if it will drain your reserves/bank of energy in order to scale.

Key considerations to note:

Will scaling help to improve your sustainability?

Or will it make an existing problem bigger?

Key areas to focus on:

  • Financial

    Do you have good turnover, profitability? Can you see market demand for what you are doing or do you need to scale and diversify to get your existing costs covered (be clear on your financial reality)?

  • People/team

    Are they motivated and empowered and sticking with you to scale, and have the right skill sets? OR Do you need to recruit new people? How can you find new ways to keep them engaged with you?

  • Environmental

    Do you have a costly model or is it really light? Will your impact scaling go really well because of the way you’ve designed your operation (circular/with supply chain influenced)?

  • Social culture

    Are you well connected and embedded in the communities at the moment? Do you have a group of stakeholders that will go with you on this journey?

TOOL / EXERCISE

C.L.O.N.E.D F.I.R.M

  • 1.

    COMMITMENT: Buy-in from staff, team and board?

     

    LEARNABLE: Transferable knowledge and methods?

     

    OPERATIONS: Systems and procedures in place?

     

    NEED/DEMAND: From end users, franchisees, policymakers?

     

    EVALUATED: Proven social impact?

     

    DUPLICABLE: Able to be replicated locally?

     

    FINANCES: Sustainable and stable?

     

    IDENTITY: Brand reputation and recognition?

     

    REWARDS: Socially and economically valuable?

     

    MODEL: Clearly understood and codified?

    Source: Social Enterprise Academy

Resources

  • Making It Big: Strategies for Scaling Social Innovations

    A report from Nesta to help social innovators consider the best options for scaling up their innovations

    Download

  • Webinar: Before You Scale

    A webinar recording from the Frontier Incubators program, delivered by SEA

    Watch

Next:

Design for Scale

All the initial ingredients to build your competitive advantage