How to tackle the growing pains of startups? Here is my experience

This article is written by Eduardo Iwai, former Chief Product Officer of Easy (Easy Taxi) for TLD. Iwai is based in São Paulo, Brazil and is currently an advisor to a number of growing startups. 

The experience running Easy Taxi’s global product team for more than six years taught me a lot: from starting up, rapid growth, global expansion to consolidation, we experienced a lot of pain and some hard lessons. 

Now looking at many other tech companies in the growth stage, I can see similar problems that we have encountered. The pain is especially severe when you are growing fast – every company suffers the same. 

Look at the following pattern: 

1. Start with very few people everyone doing a bit of everything;
2. Start growing the number of people;
3. Roles and responsibilities are not defined so overlaps and holes start to appear thus causing conflicts;
4. The starting people are nominated chiefs without proper training and no clear plan to move from operational to tactical and strategic functions; 
5. Usually, there is no clear strategy so each team starts to create its own since communications among the C-suite start to fail due to the transition from operational roles were not completed;
6. The path to having communication between lower levels are through the levels above. So bottleneck starts to form and we see more communication failure points;
7. Since everyone starts to have a different direction, conflicts start to arise and confrontation appears.
8.  Silos are formed and very difficult to break.

Sounds familiar? 

Plan ahead of time

Communications, information flow, leadership and processes are the areas typically overlooked when a startup grows in size. 

In my past experience and many other friends’ experience I have seen – some problems simply took too long to fix, wasting precious opportunities and golden timing. 

To break this, leaders need to not only realise the potential problems but also plan ahead of time to actively tackle them, involving organising and implementing the right structure, which needs to be coherent among the areas One area cannot be much larger or more developed than others.

The path is to narrow everyone on the objectives. Move the leaders from operational to tactics and then strategic move – make sure they stop micromanaging and start delegating. 

This will need to be combined with facilitating the lower levels to communicate and work with each other – break the silos as or before they form in multifunctional teams. This can only be achieved with a balanced structure and focusing the efforts to the same objectives.

How to grow your market

Another issue with the growth is the markets – at some point of view, you will need to expand from your initial offering, be it to a new market, getting an additional service to the same customers, or expanding the customer base. 

This can also be broken down to a methodology and a clear path. I see three major ones: 

1. Scale, stabilize and improve efficiency – focus on the current market – squeeze more juice from the current lemon. This should take 70% of the effort
2. Explore an adjacent market – start exploring a near market that is already studied – make it viable – prepare the next fruit for the juice. This should be 20% of the effort 
3. Study new market – understand the complexity and start breaking down into smaller viable segments – start identifying the next fruits. 10%

It is very easy to get excited and do all three at the same time without making 1 stable and 2 viable, or being conservative and maintain all the efforts in number 1, reaching faster the saturation point or not achieve a proper time to market.

This is a mistake that can be easily avoided with the proper structure, aiming at the same objectives.