The 7Ps to scale up a startup
I am probably a closet fan of the 4Ps of marketing by Philip Kotler :) But that’s not the reason why this post has 7 Ps. When I look back at my ~7 year journey of starting and building Urban Ladder, there are so many learnings that can get into a book one day! If I were to summarise it into 1 learning per year for each of those 7 years, this is the framework that I would go with :)
This framework can be used equally by people who are just starting up or are 2–3 rounds funded before they become a scaled-up organization. From personal experience, I can tell you that each of the 7 are important at almost all times of running a successful startup.
1. Purpose
Many entrepreneurs think that a vision statement is hogwash that just needs to be put in as part of building a website! This view cannot be further from the truth. The vision statement or the purpose of your startup signifies the utopian state that you will attain if you solve the key problem statement that you are taking up. This purpose is always customer focused (and not business goal oriented) and paints the vision of the future that you would use to talk to customers or future team members. The best team members are those that get a kick out of seeing that end state and want to be part of that.
At Urban Ladder (UL), our purpose is to make millions of Indian homes beautiful. Our context was that in 20 years post liberalisation, Indians were eating better (no. of international food brands and Indian fine dining options), and we were also dressing better (# of multi-hundred crore Indian and international brands in apparel). But little had changed with respect to the inside of the Indian home. Literally every single one of our team members who joined us at the start, and even to this day, do so because they feel mighty strong about making this happen.
2. Philosophy
What is the philosophy by which you want to operate the company? What are the questions that you are going to be guided by before making critical day-to-day decisions? The philosophy is the set of values and cultural elements that define day-to-day functioning of your company. Are you going to be crazy customer focused? Are you going to shoot for being sustainable from Day 1? Do you want design to be a priority? Do you want to solve challenges in an unseen manner? The solutions and customers may change as you go about building your startup, but the set of questions that you ask before making a decision will always be driven by your philosophy. Basic attributes like honesty & ethics are a must in any company in the modern day era.
At Urban Ladder, our values have morphed over time but 3 core values remain from Day 1 till today — Customer Obsession, Honesty & Transparency, & Stepping up to solve challenges. We have added Action Orientation & Efficiency to the list of values to give a reasonable acronym CHASE! (easier to remember acronyms!). Whether it’s the leadership team or a team member in a remote city interacting with customers, they ask themselves the above questions before making a decision.
3. Product
A great product is at the core of any successful startup. When I use the word product, it broadly encompasses all of the below — it could be a physical or digital product, or it could be even a service or a performance if you are in the services or media industry. Developing a successful product and marketing it has multiple angles to it — it starts by developing the right customer for your product, then ensuring there is product market fit (that the customer is willing to pay what the price for the product is), launching a minimum viable product (MVP), and continuously iterating the build of the product till the product market fit is found. Once that is done, then a 360-degree go-to-market needs to be planned (think brand, digital marketing, social media, SEO etc.) for the product so that the product reaches the entire customer base in a full package. Getting smart product managers, UX designers, engineers and marketers are key to this phase.
When we started UL, trying just 40+ furniture products in 4 categories with an early adopter audience was the first measure of product market fit. Keeping the focus on furniture (instead of adopting the easier categories like decor) ensured that we focused on proving (to ourselves more than anyone else) the hypothesis on the core proposition. Keeping to the online-only evolved customer was part of the customer development process. We kept the pricing premium for this audience, and they were willing to pay the price without having to think discounts, even though it did remove a lot of potential other bargain-hunter customers whom we were not targeting. Once the product market fit was established for the MVP, expanding the catalog, and marketing by going all in on email marketing and FB was part of our go-to-market to reach a wider audience and scale up.
4. Performance
Objectively measuring the performance of the company at any point in time is important for you to figure out if your company is actually progressing in the right direction, or you are just busy but not really moving ahead. Performance metrics encompasses 3–4 broad areas — (a) Revenue / Growth (b) Margins / Profit / Cash © Customer Satisfaction / Net Promoter Score (d) Other metrics — North Star Metric / Brand score etc. One important metric that a startup — whether bootstrapped or funded has to always track — is cash in the bank. Unless you have cash to run operations, then the survival of the startup will be at question.
There are times at Urban Ladder when we have grown 2X, 5X or even hardly grown. There are times when we have been flush with cash or almost out! There are times when our NPS has been one of the highest in the world and when they went to the pits! Each of these phases comes with its own advantages and disadvantages. And in each of those down phases, how you come together to turn the situation around tests the grit and tenacity of the collective minds in the startup. Today at UL, we have a robust performance framework for the last 2 years of our journey across each of the broad metrics grouping and team members’ goals are fully cascaded down from the CEO’s goals.
5. People
You must have heard in every article on startups now that smart people are the pillars of a great organisation. It’s one of those universal truths that still need to be reiterated. Getting A-class people who are smarter than you are pivotal to make the startup much bigger in its lifetime. There’s a multi-pronged lifecycle to ensuring smart people work with you — it starts with ensuring that the first set of team members are super smart and are living the values / culture of the company. Once that happens, these people will be able to attract other similar people to the company. Once these smart people work with each other, basic performance management and engagement mechanisms need to be put in to ensure that smart people together are able to generate a level of output that was individually not possible. Last but not the least, you also need to ensure that team members are continually growing and developing beyond their potential, and taking on challenging roles and getting trained for the next set of outcomes and challenges. With a growth mindset, a startup will always attract and retain the best talent. It’s also possible that during some parts of this journey, certain people will need to move out because they either don’t fit in with the values or the performance or the roles that are available, and at those times, it’s important to part ways.
At UL, we have had a lot of learnings across all of the above aspects of people management. We were lucky to attract some of the best talent in the industry early on, and these early team members put in place the building blocks to make UL one of the top talent pools and providers for the entire start ecosystem. Today, while many of them remain in UL building outstanding things, many others have moved on and doing wonders in companies such as Uber, Walmart, Swiggy, Phone Pe, Cure.fit, Oyo, Ola etc.
6. Process
As your startup scales up, it’s important to make it lesser dependent on the same people and more dependent on process to make it run and scale up. Process starts from basic checklists, but goes all the way up to standard operating procedures, manuals & knowledge sharing documents, foundational systems, maker-checker controls, audits, quality checks etc. It’s prudent to start small and only scale up those aspects that are growing to be big with process — if done too early, process can become quite a burden on the startup.
At UL, as and when we scaled up things successfully, we ensured that we would put in checklists, review mechanisms and quality measures to ensure that we are driving for continuous improvement and efficiency — be it our customer delivery process, or opening new cities, or of late in our retail expansion. Whenever we have not done this on time, those situations always come back and bite us.
7. Personal
Last but not the least, the entrepreneur goes through a lot of personal challenges during the journey. Personal challenges, and by extension, growth comes on two spectrums — one on the self awareness axis — if you are open to feedback and are learning, then the first big favour you would do is to become a lot more self aware — of your strengths, weaknesses, moods, emotions, decisions, etc. Without being self aware, you cannot provide leadership to your startup effectively as it scales up. The second spectrum is on the personal life side — entrepreneurship involves a lot of sacrifices on personal time — and by extension on health, relationships, hobbies etc. This will force you to brutally prioritize your personal life and only allocate time to those aspects that really matter. If you or people around you are not aware of these sacrifices, then there’s bound to be a lot of broken bridges. At all points, taking care of self health and basic commitments is a must, else the fabric of life can go for a toss.
I hope this 7P framework is something you adopt and keep track of on how you are doing. Though it almost sounds utopian to be good on all 7 of the aspects, founders who are doing well on more of the 7 than not typically have a higher chance of getting their startup in the right direction.
Do leave any other considerations that you think I may have missed in the comments.
