Get All Access for $5/mo

Top Mistakes Start-ups Make When They are in a Hurry to Scale Up It's important for entrepreneurs to realize that while growing their business, it is better to take one step at a time

By Sanchita Dash

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Shutterstock

Haven't we all heard stories about start-ups functioning out of garages or one bedroom apartments and then exponentially growing to not just one swanky office but many such offices across the globe. Every entrepreneur harbours dreams of scaling up his/her business to achieve unparalleled success. But while driving on the path of success, there come many hurdles.

Many entrepreneurs end up committing a lot of errors while expanding their operations. Entrepreneur India spoke to founders and mentors about what are the biggest mistakes entrepreneurs should avoid making while scaling up.

Growing Across Verticals Simultaneously

It's important for entrepreneurs to realise that while growing their business, they take one step at a time. Doing too many things at once and across regions will only hamper their growth for the focus too will be all over the place. Amit Mishra, founder of id8vc, believes that it is one of the biggest mistakes entrepreneurs make – not looking at one vertical or one region at a time. "Even when you look at Gurgaon or Noida, there is a huge disparity in the way products are accepted. So, an entrepreneur needs to look at one expansion at one time," he said.

Agreeing with him, Abhishek Daga, founder of Thrillophilia said that growing too fast horizontally across multiple categories is a terrible decision. "It comes at a very steep cost due to lack of knowledge and leaves a big hole," said Daga.

Not Investing in the Right Things

For a start-up, having the right tools to help you scale is important. Daga believes that every entrepreneur needs to invest in the right tools to solve problems be it like data analytics, heatmaps, automation, chatbots, monitoring tools etc. "Tools help you grow fast where you can test most of the things on subscription model before building anything from scratch," he said. He added that not building technology or setting up processes to speed up execution will lead to inefficiency.

Meanwhile, Mishra is of the opinion that putting money on marketing when it's needed is another error that start-ups make. "This money can instead be used to acquire more customers," he said.

Not Giving the Core Team A Chance to Lead

When you are expanding exponentially, it is essential that the vision of the company remains unchanged as you go down in the hierarchy. While growing the business an entrepreneur also hires at a fast pace. However, Mishra believes that while hiring local talent (in the city you are expanding into) is a great idea, the vision of the company might get lost in translation. "You need to involve your core team and give them more space. Entrepreneurs often try to micromanage by hiring local talent but having someone from the founding team lead operations in the new city for some time at least, will help new employees understand company policies," he said.

Don't Aim For the Moon

It's obviously great to have big ambitions and dreams. But it's also important for the entrepreneur to stay rooted. This is one philosophy that Daga believes personally. "It's important to set up realistic monthly or weekly goals and keep achieving them," he said.

While start-ups are supposed to have the ability to grow fast, they should always set targets that they can achieve. If not, it accounts for not just monetary loss but also the energy of the team.
Sanchita Dash

Entrepreneur Staff

Former Senior Correspondent, Entrepreneur India

In the business of news for 5 years now. Making my way across India thanks to my career. A media graduate from Symbiosis, Pune, I have earlier worked with Deccan Chronicle (South India's leading English daily), T-Hub (India's largest incubator) and Anthill Ventures (a speed-scaling platform). 

Stories, movies and PJs are my thing. 

If you hear 'The Office' opening score randomly, don't worry it's just my phone ringing. 

 

Science & Technology

The Deepfake Threat is Real. Here Are 3 Ways to Protect Your Business

The rising use of deepfakes is a growing threat to businesses and society as technology advances. Here are three tips for companies to combat this threat.

Marketing

5 Ways ChatGPT Will Impact Digital Marketing

ChatGPT is creating ripples across the digital landscape right now. Here are five ways it can benefit your ads, campaigns and marketing strategies.

Science & Technology

How Can Marketers Use ChatGPT? Here Are the Top 11 Uses.

With the recent developments in AI and the popularity of ChatGPT, you may want to integrate AI into your marketing practices. Find out how.

Business News

Apple Is Working on Making Its $3,499 Vision Pro More Affordable — and Mainstream. Here's How.

Apple's product is at least three times more expensive than Meta's version.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

News and Trends

Cedar-IBSi Capital Secures Major LP Commitment from HFPCG for FinTech VC Fund

With an initial cheque size of INR 4–10 crores (USD 500k–1 million), Cedar-IBSi Capital will seek to invest in around 15 early-stage BankTech-focused startups in their Seed-Series A rounds.