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Startup Life/Interview/

4 common challenges scaling leaders face — and how to overcome them

Which of your current work processes still work when your company quadruples?

By Poppy Koronka

“After working in your first scaleup, you think ‘this place is crazy’,” Gillian Davis, founder of Overtime Leader and partner of Tech Nation’s Advance: Scaling Leaders programme, told Sifted. 

“Then you go and work at your next one and you realise — this is just working in a scaleup. It’s just the nature of working in a high-growth company.”

According to Tech Nation, 23% of scaleups fail because they don’t have the right team or lack experienced leadership. So what can scaling leaders do to prepare? 

Sifted spoke to Davis, as well as several graduates of Tech Nation’s Advance: Scaling Leaders programme, to find out how leaders in scaling tech companies — from heads of sales and CTOs to marketing managers and HR directors — can overcome common scaling and leadership challenges, including: Loral Quinn, founding CEO of social impact fintech Sustainably; Jennifer Brady, marketing executive at SaaS fintech Lightyear; and Sinead Daly, director of culture and experience at recruitment platform Beamery. 

1. Future-proofing work processes for future growth

In a startup’s early days, founders often have to think about their immediate day to day responsibilities, rather than planning for when their team is 200 employees strong or expanding into new countries. 

Quinn, whose startup Sustainably is pre-seed, says keeping these future decisions in mind early on has been key: “The sooner you think of these things, the more likely that you’re not going to create problems for yourself later on. Even scaling from four to eight people or from eight to 16 — if you don’t get the processes right early, you know you’re going to create so many issues for yourself.”

Davis refers to one of her post-series B clients as an example, which grew quickly, leading to a few initial communication bumps. 

“Our sales team was changing, because they were growing, and one of the sales managers was very upset,” she told Sifted. “They were planning to move offices and he was very agitated about this change. He said, ‘If we’re doing this move, I’m not going to be able to yell across the table and get the designers to make changes and that’s really inconvenient for me.’ I said to him: ‘Well, what happens when you scale internationally? How do you yell across the table when half the team is in New York?’” 

Even scaling from four to eight people or from eight to 16 — if you don’t get the processes right early, you know you’re going to create so many issues for yourself.”

Davis pushed the sales manager to keep the company’s future global ambitions in perspective. “I know it’s easy to yell across,” she says. “But it’s not a scalable process. So I challenged him to think about the alternative to that which is more inclusive of a global team.” 

2. Alienating employees in times of rapid change

At the beginning of a startup’s journey, early hires are often generalists who fill many roles. Then, as startups grow, they need to hire more specialists. But how do founders ensure their earliest hires still feel valued with all this change?  

Quinn says involving existing employees as much as possible in the hiring process has helped make early hires feel like stakeholders, boosting employee satisfaction and helping avoid employee churn. 

Brady echoes Quinn, and says involving Lightyear’s employees in the recruitment process has also helped them find the best talent, and hire people who are a great culture fit.

“One of the biggest challenges for us was finding talent to fill the roles,” Brady says. Lightyear used recruiters with little luck. Brady learnt on the Advance: Scale Leaders programme that getting your current employees involved will find you better talent and reduce friction. “Using their techniques of getting everybody in the current team involved in the process, everybody engaged and everybody finding candidates has helped us a lot.” 

3. Founders fail when they get ‘stuck in the weeds’

In a high-growth company, things change extremely quickly. Scaling teams need someone to steer the ship in the right direction.

According to Davis, mistakes are made when scaling leaders get stuck in small, technical issues and lose sight of the bigger picture. 

“A lot of founders and scaling leaders can sometimes get too stuck in the weeds, because it’s comfortable there. There are some roles that a founder cannot delegate,” Davis says. 

“These are the three things I think founders should be focused on,” Davis continues. “Making sure you’ve got good investor relationships, making sure you understand what the customer needs are and making sure you’re building your team. But if you’re stuck in the nitty gritty, then no one’s running that ship.” 

Brady agrees that properly delegating is key to overcoming a lot of scaling challenges which starts with trust. 

Making sure you’ve got good investor relationships, making sure you understand what the customer needs are and making sure you’re building your team.”

“You need to trust your team and your team needs to trust you,” Brady told Sifted. 

4. Keeping a sustainable workload

Keeping sustainability in mind while rapidly scaling is a massive challenge. Davis told Sifted solutions that might not be taxing when you have two clients might be impossible when you have one hundred.

“It’s important to think about the level of service you give your client and what you can maintain as sustainable for you as an individual. Can you sustain this way of life when the stakes are higher? There’s more people that need you as a founder or leader –– how do you scale yourself as the business scales?” Davis asks. 

Daly says that caring about your employees’ and colleagues’  wellbeing and being a considerate employer is a key part of scaling a sustainable business. She says: “Being deliberate in embedding infrastructure around diversity, inclusion, wellbeing and making a positive impact as part of your core DNA is going to be key in managing some of the people-debt that you’ll likely face later down the road.”

“Being deliberate in embedding infrastructure around diversity, inclusion, wellbeing and making a positive impact as part of your core DNA is going to be key in managing some of the people-debt that you’ll likely face later down the road.”

Apply for Tech Nation’s Advance: Scaling Leaders Programme

Quickly scaling businesses need all the help they can get. Enter the Advance: Scaling Leaders Programme where startup founders and executives can learn how to overcome scaling challenges. 

Participants will receive 10 weeks of leadership training, exploring common team-related growth issues. They’ll receive personalised advice from leaders like GoHenry founder Louise Hill and Unruly founder Sarah Wood, and develop action plans in practical workshops with scaling coaches. 

Startups and scaleups can apply now through this online form for the 10-week course, starting September 24, 2021. 

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