Why scaling sustainably is a powerful way to grow

Many female founders start a business believing passionately in the impact their work will have, only to get caught up and sucked into a predominately male “startup culture”. Instead of feeling fulfilled and successful, they find themselves isolated, burnt-out, and feeling trapped, wondering where it all went wrong. But it doesn’t have to be this way. Women think differently.

An alternative to the startup industry mantra ‘move fast and break things’ is to scale up sustainably.

Without sacrificing extraordinary business growth, impact – or even fun – scaling sustainably is a powerful way to grow for female founders.

Interested? Read on to find out what this looks like in practice.

Mug - see the good. How women do business differently.

The Startup Industry: Industrialisation of High-Growth Potential Business

Over the last 20 years, I have witnessed the emergence of the startup industry. A male-dominated industry manufactured by investors and government policy advisors to generate capital returns and economic growth.

This process initially benefitted startup founders, developing resources that greatly improved their chance of success. For the first-time founder CEO, it has produced methodologies (e.g. Lean Startup), tools (e.g. the business model canvas), and case studies that reduce the risk of starting a business. Infrastructure has been created to make it easy to access resources such as founder networks, co-working spaces, accelerator programmes, grants, and crowdfunding.

The downside is startups have become a commodity. The dream of one passionate and daring individual risking it all now only has a 1/10 chance of success. Investors will quickly turn their attention elsewhere if a business does not meet targets on the desired growth curve.

A devastating experience for many entrepreneurs.

How startup culture negatively impacts founders

The startup industry has developed its own culture. A culture shaped through stories told, beliefs nurtured and the actions of those with power to produce short-term returns. A culture shaped to prioritise portfolio returns over building businesses for future generations that leave a legacy.

Some of the most highly valued businesses such as Twitter, Facebook or WeWork are unable to sustain themselves financially and instead rely on continuous investment.

A culture that sucks founders into believing that there are strict processes they must follow and milestones they must hit, to realise their dream. They must find co-founders, live off their savings, raise capital, and want to be CEO. If they don’t have 100 customers in the first 100 days, they are dead in the water.

A culture that’s often unfriendly to female founders.

As a result, many founders who started a business believing passionately in the impact their work would have, finding themselves isolated, burnt-out, and feeling trapped. Many excellent articles have been published on the mental health impact of the startup culture on founders.

How social enterprise culture negatively impacts founders

Additionally, in the last 10 years, social enterprises, and tech for good have entered the startup industry. The culture around social enterprises combines the worst of charity and startup cultures.

Social entrepreneurs are expected to run at the speed of a traditional tech startup but with poorer access to resources and funding and less likelihood of a liquidity event (an opportunity to cash out).

There is an underlying belief that “you can’t do good and make money”.

Social entrepreneurs are more likely to put their cause ahead of their own needs. They often overload themselves with too many responsibilities and deplete their personal resources such as time with family or sleep, which ultimately leads to burnout. This behaviour starts with the founders and ‘infects’ the team, becoming part of a destructive organisational culture.

How successful female founders approach business

However, there is another way. Over the last 10 years I have noticed that too often, female entrepreneurs don’t recognise the power and choices they have.

Women don’t have to follow the status quo; the rules and processes that a male-driven culture has defined. Female founders can view their role and their lives from a different perspective.

As the founder, you get to decide what success looks like.

It will mean unplugging yourself from the Matrix. Maybe not an attractive option initially, but you’ll soon find your tribe and your freedom. Plus, you can always drop back in, with your eyes wide open, when it suits you.

This doesn’t mean you won’t experience extraordinary business growth and can’t have an impact at scale. It does mean thinking for yourself, questioning what you hear and choosing who you listen to and who you spend time with.

It is possible to build a business you are proud of, work in a role you feel fulfilled in and create a company that leaves a legacy. It is possible to scale sustainably.

The four pillars of scaling sustainably

What does ‘sustainably’ mean?

When talking about businesses scaling up sustainably, I’m referring to a combination of factors that work together to produce businesses that have longevity and leave a legacy. They produce what I would call a Balanced Business.

A Balanced Business:

Only asks from its people what they can sustain

Can sustain itself financially Can sustain growth without exhausting its resources Is adaptable to the environment in which it operates

Operating a business this way is just good business. Yet neither startup nor social enterprise cultures promote building businesses this way.

Building a balanced business doesn’t have to be overly time consuming or a distraction from building your business. As a founder CEO, you can bake in the ingredients required to become a balanced business - from the start.

I’m commonly asked these four key questions from early-stage founder:

1. How do we balance growth and building a product that is for good?

2. How do we build a culture that encourages diversity?

3. How do we navigate our differences as co-founders?

4. How do we communicate that we are for good and for profit?

These questions can be answered with the four pillars of building a business sustainably:

The four pillars of building a business sustainably.

• Leadership

• Process & Practice

• Culture

• Business Design

1. Leadership

As the founder CEO, your business starts with you. If you don’t want to end up down a path with your business that makes you unhappy, you must be clear and honest with yourself from the start about what motivates you.

You’re not only creating a business to solve a pressing problem and meet a market need. You are also subconsciously forming ideas about what success looks like as well as creating a role for yourself.

When you become aware of these ideas or assumptions you increase your chances of enjoying the journey. Whilst you have control of the business you can design it in a way that will meet your needs.

EXAMPLE

One founder I worked with came to me wanting to win more work contracts to grow her business. She thought she’d be happy once she’d proven to herself and those around her that she could make a success of the business.

However, once she had set herself goals, she would often find herself lacking the motivation to follow through on them. This would lead to feeling like she didn’t have what it takes to succeed. We had evidence that she did have what it takes so we took another look at her motivations.

Digging deeper, what she really wanted was greater connection; a community of peers and clients she worked with regularly. We re-designed how she was approaching her business to be more relationship-based and she started hitting her goals immediately.

Action:

Write down what drives and motivates you.

Use these statements as a set of criteria you can check in against once a month or when making decisions. Through this practice you may find they change over time, prompting changes in your business so you can continue to enjoy the journey.

Often founders have a vision that lives only in their minds. Only they truly understand it. This can quickly morph into a recipe for disagreement with stakeholders, disenfranchisement of talented hires, and founder burnout. It’s important to share your vision from day one.

As your business scales and you relinquish control, what success looks like for your business is no longer yours to own exclusively. Co-founders, senior recruits, and investors also have a vested interest. The vision you define for the business and the culture you create at the start can influence the long-term direction of the company.

 2. Management processes and practices

How your vision translates into your company strategy and values is also something you have influence over. Establishing management processes helps to ensure that what’s in your head is shared with everyone in the company. This is especially important when you no longer hire staff personally.

Action:

Write out your company’s purpose, strategy, and key metrics. Then ensure these details are translated directly into the objectives and performance measures for every individual role.

But for many female founders, talk of developing ‘management processes’ starts sounding too “corporate”; most are allergic to the idea of becoming “corporate”. Often this is due to past processes, meetings, and rules they have come to loathe.

Yet again a female mind can come at this differently. Women are often more relational so pairing strategy with resourcing can create a powerful process. People can operate most effectively when they know what is expected of them, have the resources they require and are motivated to achieve the goals they are set.

Design your management processes and key metrics to ensure you get the right people for the right role at the right time. Shape and create a business environment for your staff to operate smoothly within and provide the support they require to do their jobs. These activities can help greatly when fundraising and choosing advisors, board members, and partners.

EXAMPLE:

One founder shared the process they had been which allowed them to delegate and handover the operational side of the business:

“It took six months. At first, I worked very closely alongside her. Once she was ready to start doing the work herself, I would check her work. For me, quality is everything.

Once I felt I could trust that our quality promise would be met, we agreed certain KPIs around issues which needed escalating as well as our reporting schedule. At first this was daily, then weekly and now monthly. It took time to tweak and get the metrics right - to give us both the confidence that we were measuring the right things and neither of us was going to get a nasty surprise.

Now, I don’t get involved hardly at all. She has made that side of the business her own.”

Specific but not prescriptive objectives give scope for a team to play to their strengths as well as to adapt to changes in market needs. Clear organisational priorities that translate into individual priorities allow a company to sustain growth without exhausting the resources it draws on.

As you grow a business, having the right person in the right role isn’t simply a question of finding and retaining talent. You’ll need to constantly re-assess the business’ needs and what is required from each role.

Ambitious individuals require a balance of work that they can confidently deliver and opportunities to stretch their competencies. For others, the role may outgrow their individual capabilities. If they aren’t prepared for this it can be destructive for them, those they lead, and the business.

In summary, putting in place the following management practices will give you freedom as a founder CEO to focus on what you need to, knowing the business and your team are on track:

1. Translating purpose and vision into values, strategy, and key metrics with regular reviews

2. Defined roles, objectives and performance measures reviewed regularly alongside business goals

3. Resource planning process and review schedule

4. Team management practices

5. Professional development for senior staff

They can be light and simple at first and become more robust as your business grows. But they should not be ignored when it is time to make your first hires.

3. Culture

What is culture and why is it important?

Quite simply, culture is the experience an individual has when they interact with your business. If a business was a person, it is how you might sum up what it’s like hanging out as friends.

Without a strong organisational culture, leadership often reverts to control, limiting a business’s growth and potential. A culture based on control will limit creativity. A degree of structure gives you freedom.

As a business grows, culture becomes critical to your performance, reputation, and retention of talent. Culture also influences your ability to adapt to market changes as it significantly impacts the decisions everyone in your organisation makes each day.

Individual decisions such as:

• Whether to hide a mistake or escalate it?

• Whether to speak up if something unethical has taken place?

• Whether to share ideas on improving a product or service?

• Whether to tell the boss I’m unhappy at work, struggling at home or to just leave.

Or business decisions such as whether to prioritise the company’s purpose or profits.

Without a strong organisational culture, companies end up relying on rules, process, and audit to influence decision-making. This stifles the creativity and independent thinking of your workforce; the antithesis of what most disruptive businesses are aiming for.

Culture: It starts with you

When you start a business, the culture reflects your values and your preferred ways of working and engaging with people. You will have created a company culture whether you were aware of it or not. But the culture that got your business off the ground may not the be culture it needs to achieve its current goals.

Unlike your purpose, culture isn’t fixed. Becoming aware of it and your influence over it is a first step to shaping it. The first step is to become more aware of your own behaviours. If everyone in the business went about their work in the same way you do, would the business succeed?

“Do what I say, not as I do” just doesn’t work.

For example, if you are working 20-hour days, working weekends, and not taking holidays you are sending a message to your team that this is what is expected of them. It doesn’t matter what you say, this is the example you are modelling.

If you’ve read the research, diverse teams perform better at problem-solving and create more robust and innovative solutions. How might your working hours and the expectations they create impact your ability to attract and retain a team of staff from different backgrounds, ages, and genders?

This is just one example of how the way you work plays out in your organisational culture and your ability to achieve your business goals.

Another example may be how you navigate differences as co-founders. This will be showcased as an example of how teams navigate their differences and divisions within your organisation.

Shaping your business culture starts with being self-aware and intentional in how you perform your role.

4. Business Design

Business Design is simply the channel through which your purpose is translated into a strategy and then implemented.

Business design will be influenced by the type of business you want to build, the impact you want the business to have, and the role you want to play. Furthermore, it will depend on where you decide to innovate on the status quo and where your market is most responsive.

A business that is sustainable will sustain itself financially, find a balance between growth and impact, and won't exhaust the resources it draws on. The balance of for-profit and for-purpose will be evident in the way the business engages all its stakeholders and sustains itself.

Here I come back to the worst things about start-up culture and the worst things around the social enterprise culture.

Following the “move fast and break things” motto often means pushing so hard that you break yourself, break your team and compromise your vision. Making compromises to the extent that you no longer feel connected to the business, and it’s no longer sustainable. Perhaps you’ll sell the business, but will the money be enough?

“You can’t do good and make money” is a false economy. It is not sustainable to neglect your own needs such as paying yourself so you can feel secure paying the mortgage and putting food on the table. Getting sleep, taking time to connect with the important people in your life, and building capacity to avoid burnout.

Why shouldn't you be rewarded for the risks you take and the resources you put into establishing a business that will benefit society? If that business is benefiting society already, should it not be well-resourced, and the people involved rewarded? Then it can be sustainable, and its impact grows even more.

It is possible for businesses to grow sustainably with the right operational business model. One where the product both generates a financial return and has a direct social impact. This is called a ‘lock-step model’.

EXAMPLE

School Space creates income for schools by hiring out their spaces to individuals, clubs, societies, and local businesses. A partnership with School Space has seen, on average, a 128% increase in the schools’ facility usage within 6 months of working with School Space. Every event booking made through School Space produces income for both School Space and the school. Income that benefits teachers, students, and the school’s local community.

Next steps

Founder CEOs can build sustainable, balanced businesses that fulfil their vision, deliver on their needs, and have an impact at scale. There will always be trade-offs to be made but they don’t need to be your happiness, financial security, or the impact your business can have.

Don’t get me wrong, the startup and social enterprise communities have a lot to offer founders. But always be intentional about what you want from them, and what you don’t, so you don’t get knocked off course.

Women play the game differently. Don’t get sucked into a male-dominated culture and mindset.

Actions For Female Founders:

Get clear on what you want from your business through self-reflection

Surround yourself with like-minded individuals - peers, advisors When the time comes, vet your investors carefully

When it comes to finding a suitable investment partner, it’s vital they share your desire for impact and not just profit when looking to scale. We’ve done the research for you and compiled our Top 7 VC Investors with a Difference.