The blitzscaling concept has been around for some time now. Most startups are adopting it into their business strategy. It is an all-out aggressive program that gives speed much more importance than efficiency. It is a framework that any business can use when scaling the business matters and getting in early and fast will make all the difference.
The normal strategy businesses adopted in the past was emphasizing efficiency over speed. However, when there is a potential interest in the market for a certain product or service, the risk isn’t inefficiency; it’s playing it too safe.
There comes a point where an opportunity arises to scale up and the fastest way to do it is through blitzscaling. One example of a company that successfully blitzscaled is Amazon.
In 1996, Amazon had roughly 150 employees and $5 million in revenue. Within 3 years, in 1999, Amazon employees increased to 7,600 and revenue to $1.65 billion. That is a tremendous percentage increase in such a short period of time.
The concept of blitzscaling can be implemented in any type of company and country. Blitzscaling was first introduced in Silicon Valley, and most of the startups there have utilized this strategy for growth.
When to Blitzscale
A company should blitzscale when they have determined that the speed of penetrating the market is the critical component in achieving massive success.
With the introduction of new technologies, innovation, and expansion of global markets, it can create a new market for a particular product or service and scramble an existing one. Look at how Airbnb and Uber disrupted the hotel and taxi industry.
One prime reason for blitzscaling is it to achieve a critical mass that confers a long-term competitive advantage. This is not the same as the first-mover advantage – unless you are the first company to scale, being first to launch does not necessarily mean you will become the dominant player.
Blitzscaling can be used to create a competitive advantage if you are the first company to climb a steep curve. Netflix had to climb a steep curve by developing a subscription-based video service, then build a streaming infrastructure, and then by creating original content. The threat of competition is what motivates many startups to blitzscale at a faster pace.
If your startup decides to take this approach, then you should ask yourself ,“how can we move faster?” Think of ideas and strategies that can give your company a faster boost.
Should You Blitzscale?
This approach does not always work, and it shouldn’t always be the go-to strategy. If you believe taking on additional cost and facing uncertainty is not advantageous, then first follow the traditional rules of conducting business. Then, slowly implement blitzscaling.