🌱📈 A Business Model that Scales...

Hi there,

Are you scaling, need to grow or just starting out? Great, because we’re here to add value for founders, startups and businesses at every stage of your innovation journey:

1. Startup Phase

2. Growth Phase

3. Scale/Sale Phase

Understanding South Africa’s startup ecosystem

Hailed as Southern Africa’s No. 1 startup ecosystem, one of Africa’s top 4 and 53rd globally, SA startups attracted slightly less investment in 2023, but that is a global trend. SA’s mostly private investors don’t have money to waste. So startups like FinTech Pineapple (R400m), which proved it can acquire new customers at 20% cost, will get preference – emphasising the importance of revenue generation, profitability, and making use of existing expertise in the ecosystem. See how to get the best in startup support.

Creating a solid business model

Complex business models don’t make it, the simpler the better says venture capitalist Guy Kawasaki. Outline it in 5–10 words: 1) who has your money (customer) and 2) how you’re going to get it (“we charge a listing fee + commission”, for example). For this, it helps to know your niche and use variations of tried-and-tested existing business models – don’t be afraid of experimenting and even tweaking your model constantly.

Navigating legal and tax basics for startups

Don’t just run to the CIPC to register a company, says SA tax expert Andre Bothma, starting as a sole proprietor offers way more flexibility, ease, and cost-effectiveness. Simply start off with revenue-share contracts between partners – just make sure it’s all documented. Then, once you scale, you can register a company, redefine business contracts, and perhaps even set up overseas if that’s where you want to expand and get investment from. Get SA-specific insights in the episode of How Would You Build It on tax for SA startups.

Just starting out and can use a hand? Hit reply and let us know how and where we can help you move faster.

Building a scalable business model

Being scalable comes down to four key elements: 1) Turning cold prospects into highly gratified customers (the core of your product and how it adds value), 2) Making economic sense – spending less acquiring a prospect than your return per customer, 3) How you can grow – your margins will dictate how much and how fast you can spend to get more new users, and 4) The size of your market – a scalable model often means having specific plans for targeting individual market segments, one after the after, says Sean Ellis.

Effective growth hacking strategies

Ryan Holiday blew the lid off growth with his book Growth Hacker Marketing. 1) Build your product for/around the marketing strategy, not the other way around. 2) Engineer your tipping point by spending millions in advertising, a big PR stunt like winning a major award, being on the 6 o'clock news, or cover of Time – whatever gets you in front of 3) as many early adopters as humanly possible at once. Then 4) focus all your energy on user retention and engagement.

Building and managing a team for growth

Laszlo Block’s keys to great teams are 1) Connect personal meaning to jobs – let people see the real-world impact of their daily tasks, 2) Hire people who are better at that task than you, 3) Pay top performers way more than the average, 4) Encourage people to socialise and make sure their equipment is 100% up-to-date and effective. But, while you’re still building your ideal startup team, bridge the gap by outsourcing what you need.

Need some help growing faster? Hit reply and tell us what you need – we’ll get our best team on it…

Advanced sales strategies

Inbound sales are all good and well, but if you want to land the big deals, it’s time to get good at enterprise sales – going to corporates and landing them as clients. It means becoming a great listener, taking the hit, and going to see prospects in their offices for months on end with no immediate benefit. Learning how their business works, becoming their friend and never taking no for an answer says SaaStr founder Jason Lemkin. You might want to hire an internal sales team to keep things ticking over while you do this.

KPIs for scaling your businesses

SaaS consultant Midstage Institute has a Jim Collins (Good to Great)-based method called North Star metrics for scaling that gives your entire company just 2 metrics to focus on. Examples: Facebook focuses only on active users + engagement time, and Google on active users + clicks, because that’s how they each make money on ads (their business model). Depending on how you earn revenue, you can create company-wide North Star metrics on 1) Growth Metric – number of actions that lead to revenue; and 2) Economic Metric – how much profit per action.

Automation and technology integration

Scaling doesn’t mean bloating. Remember all the big tech layoffs of ‘22 and 23’? That’s because everyone overhired (bloated) during the pandemic. And with investors looking for real revenue returns from startups these days, it’s much wiser to scale leanly by using smart automation and tech integrations in years 3, 5, and even 10. See how to do it smartly with custom software support.

Looking to sell or scale? Hit reply and we’ll help you get it done faster…

Have your say

What’s happening at Specno

While we’re all looking forward to the holidays, our teams are all set up and ready to support clients throughout the season and into the new year.

In fact, we’re currently planning our social events for Q1 2024, from the next Specno community hike in January to an all-new Founders Den in early 2024. We’re inviting new partnerships for events & sponsorships for 2024. Get in contact now before all the opportunities are filled.

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