Growth is an exciting phase in a company’s lifecycle – be it early-stage, market entry/expansion, product launch, M&A, strategic partnership or digital transformation. There is huge potential but also several challenges to overcome – risk, uncertainty, change. The odds are against growth ventures.

90% of venture-backed companies – start-ups and scaleups – fail and the Top-3 reasons for failure include poor market-fit, lack of general business and domain expertise. While risk is an intrinsic part of early-stage and innovation-based companies, many of these risk factors are manageable and avoidable.

For established companies, the odds improve only slightly – one in four market entries and one in eight digital transformation initiatives realise the expected return. Underestimation of external environmental factors in market entry and the expectations gap between technology solutions and end-user needs in digital transformation are a few specific reasons these growth initiatives fail.

Even after considering all new businesses incorporated in the US in 2020 and not just innovation-based companies, the failure rates are high – 20% will winddown in Year 1, and 70% in Year 7.

While there is no magic formula to de-risk growth, the vast evidence base and our personal experience tells us that beating the odds is about getting the combination of a few things just RIGHT. These include the concept (technology & commercial), timing, capital, people, know-how, culture and growth mindset.  

Are you ready for the next phase of growth?