Why You Shouldn't Scale Your StartupOne of the biggest startup killers? Scaling too fast, too early. Here's how to grow more deliberately.

ByWalter Chen

Opinions expressed by Entrepreneur contributors are their own.

Startups are at their sexiest when hundreds of millions of people around the world use something that a couple of guys and girls built in their garage.

But I've noticed how that perception lays a trap for many first-time entrepreneurs. With their sights set on serving the masses, first-time founders often conclude that they must build a product that will work for millions of customers -- before they even have one.

This is such a major problem that Startup Genome identified "premature scaling" as the number one cause of startup failure. Surveying 3,200 startups in 2011, the startup-community hub Startup Genome found that a whopping 70 percent failed because they tried toscale too early——消耗资源等附件昂贵的marketing and hiring salespeople before they truly had a product to satisfy a sufficiently large market.

Here are three ways to build a business organically:

1. Do things that don't scale.
Paul Graham of Y Combinator fame explicitly implores his companies todo things that don't scale, like finding ways to pay attention to and delight individual customers early on instead of dismissing such moves as unscalable or trifling.

In Graham's experience, first-time founders mistakenly believe that startups either take off or don't, and that's why they often impetuously prepare for startup glory. By relying on the patterns and models of well-established startups, founders miss a pivotal stage in their company's own life and therefore fumble.

Ryan Smith, founder and CEO of Qualtrics, a research software maker in Provo, Utah, describes the correct order of operations: "Nail it, then scale it," he says. Founders and their companies must go through an "adolescence phase" to nail who they are, as starting a business requires a period of growing up, self-learning and tuning of their product, identity and approach. After all, you have to learn to walk before you can run, right?

Related:The Race to Scale: How Fast Should You Accelerate?

2. Make something people want.
Part of the adolescent stage involves slamming doors on ideas and features that distract from your product and path. When it comes tomaking something that people want, the hard part most often is figuring out the "what people want" part. You can build something, but is it the right something?

To discover what people will pay for, find the right market, study and experiment with your product and talk with customers. The great advantage of making what people want is having a product that markets itself.

Related:Bootstrapping Your Startup to Scalability and Profitability

3. Sell it before you build it.
I've seen first-hand how successful startup founders initially gained real, paying customers before writing a single line of code -- and then scaled up their technology and personnel second.

Zirtual, a virtual-assistant service, grew its business for a year and a half without any real technology. The new customer-signup form on its website just sent an email to founder Maren Kate Donovan to alert her that someone was trying to sign up. She had to add that customer to the new customer spreadsheet and email the new customer manually, and then scan through her pool of virtual assistants to find the best fit. Signing up a new customer took an amazing 45 minutes.

Donovan and her co-founders went through this pain to make Zirtual happen in spite of their technical limitations to be absolutely sure they were building something that people wanted before they scaled up and raised a $2 millionseed round.

Related:Biggest Mistakes: How JackThreads Overcame Its Growing Pains

The San Francisco-based startup ZeroCater also spent time working off a spreadsheet in its early days. New customers came from in-person sales or cold calls over the phone and were managed in a spreadsheet, all by solo founder Arram Sabeti. ZeroCater grew to tens of thousands of dollars' worth of paying customers before Sabeti decided to scale the company bringing on a developer and join Graham's accelerator, Y Combinator.

No doubt, it's scary to sell before you build and to step outside of your comfort zone. But asGraham put it in a recent blog post: "It would be a little frightening to be solving users' problems in a way that wasn't yet automatic, but less frightening than the far more common case of having something automatic that doesn't yet solve anyone's problems."

How did you know when to scale your company?Let us know with a comment.

Walter Chen

CEO & Co-founder, iDoneThis

Walter Chen is the founder and CEO of iDoneThis, the easiest way toshare and celebrate what you get done at work, every day. Learn the science behind how done lists help you work smarter in our free eBook:The Busy Person's Guide to the Done List. Follow him on twitter@smalter.

Editor's Pick

Related Topics

Business Ideas

These Retirees Just Wanted Their Cats to Drink More Water. Now Their Remote Side Hustle Makes $80,000 a Year.

This couple wanted to make and sell something from the comfort of their home. Now they're offering up their playbook for others.

Money & Finance

Want to Become a Millionaire? Follow Warren Buffett's 4 Rules.

企业家是不能过度指雷竞技手机版望太多a company exit for their eventual 'win.' Do this instead.

Living

8 Things I Discovered While Working With Affluent Clients in New York City

After a decade working with the 1%, I learned that they have common traits.

Business News

Carnival Cruise Faces Backlash Over Handling of Missing Veteran Case

A 26-year-old former US Army veteran went missing nearly two weeks ago after a Carnival Cruise ship docked in the Port of Miami following a family vacation.

Business Ideas

55 Small Business Ideas to Start in 2023

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2023.

Devices

Light Up Your Space with More Than 16 Million Color Choices on This Floor Lamp for Only $70

This minimalist floor lamp can create a look or a mood that can easily be switched to something different.