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Extremely rapid growth for a
business might sound good, but
it can be a mixed blessing.
Certainly, high growth yields
greater returns, offering share-
holders five times more than
medium-growth companies,
says Debora McLaughlin, CEO
of The Renegade Leader Coach-
ing and Consulting Group.
Growth predicts long-term suc-
cess, she says, and it matters more
than margin or cost structure.
But sustaining growth is ex-
tremely difficult.
For example, a business may
have tremendously high growth
in the start-up phase, as did the
daily-deals pioneer Groupon,
which had a stellar valuation of
$6.4 billion in 2010.
“By 2012, Groupon had lost
a mind-boggling 80 percent of
its stock value since its initial
public offering,” McLaughlin
says. “What happened? The tech
company never figured out cus-
tomer retention.”
While Groupon is a prominent
example, it’s certainly not the only
one. Approximately 85 percent of
super-growers, defined by McKin-
sey as companies whose growth is
greater than 60 percent, are un-
able to maintain their growth rates,
and once lost, less than a quarter
were able to recapture them.
McLaughlin, author of “The
Renegade Leader: 9 Success
Strategies Driven Leaders Use
to Ignite People, Performance &
Profits,” offers tips for maintaining
momentum for businesses that
are experiencing high growth.
• Define your Culture.
You
can’t afford not to invest the
time to define the culture
needed to support your strate-
gic plan. What is the purpose
of your company, its guiding
values, and its top priorities?
Defining the culture allows you
to align senior leaders, stake-
holders and investors, make
faster decisions, attract top
talent and engage employees.
• Do your best to retain
the right people.
Often, the
problem faced by fast-growing
companies is that they need to
hire people fast so they fill po-
sitions based on talent versus
fit and attitude. Hire people
who align with your culture and
its values. Have the right mix
of visionaries with executers.
• Maintain the quality of
your product.
Whatever it
may be – an online service or
your town’s best muffins – ex-
ponential growth can have you
running in 100 different direc-
tions. Don’t forget what got you
to this point: quality. Continue
to wow the customers who
trusted in you at the beginning.
• Make sure you have the
money you think you have.
It’s easy to confuse growth of
accounts receivable for tan-
gible, cash-based growth. If
your company isn’t collecting
the cash it’s due, there’s a risk
of running into a cash crisis
during growth. There’s nothing
more valuable for an expand-
ing business than cash.
“You want to manage
your growth in a smart way,”
McLaughlin says. “You want
growth that easily translates
to profit, which means collect-
ing data, doing the research
and challenging your business
instincts. Don’t be so focused on
your product or service that you
fail to notice the shifting sands of
your consumer demands.”
Debora McLaughlin is a cer-
tified executive coach and CEO
of The Renegade Leader Coach-
ing and Consulting Group. She
helps business leaders ignite
their inner renegade leader
to unleash their full potential,
drive their visions and yield
positive results, both in busi-
ness and in life.
“Approximately
85 percent of
super-growers...
are unable to
maintain their
growth rates... ”
Is Your Business Growing Too Fast?
How to maintain market-share mojo
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