{"id":14944,"date":"2021-07-12T12:38:34","date_gmt":"2021-07-12T12:38:34","guid":{"rendered":"https:\/\/startgreen.nl\/blog-3-from-start-up-to-scale-up-lessons-for-entrepreneurs-and-investors\/"},"modified":"2021-07-12T12:38:34","modified_gmt":"2021-07-12T12:38:34","slug":"blog-3-from-start-up-to-scale-up-lessons-for-entrepreneurs-and-investors","status":"publish","type":"post","link":"https:\/\/startgreen.nl\/en\/blog-3-from-start-up-to-scale-up-lessons-for-entrepreneurs-and-investors\/","title":{"rendered":"Blog 3. From start-up to scale-up: lessons for entrepreneurs and investors"},"content":{"rendered":"\n\nJuly 12, 2021<\/span>\n\nOn to the grande finale<\/em> I have been working towards in this blog series. Now that we know the results of 7 years of impact investing, it is interesting to look at the most important lessons we have learned with the eleven start-ups on their way to growth. Lessons that I want to share with both fellow impact investors and entrepreneurs to increase the chances of successful scaling. \n\n\n #1. A mission-driven team, with the right people in the right place<\/span><\/strong>\n\nPeople, people, people. The obvious key to successful scaling is undoubtedly a good team, as every investor will agree: 80 percent of start-up success is about people, and only 20 percent is about what fascinates all these people\u2014the technology and the company. Half of all scale-ups are founded by a group<\/em> of founders, rather than a single founder. From my own entrepreneurial and investment experience, I recognize these statistics, and I therefore pay attention to whether all the necessary qualities are present in a complementary group of entrepreneurs. More specifically, I have learned to take the time to analyze whether the right people in the right place have demonstrably found their feet, by making (repeated) progress and correctly applying the principles of scaling (see lesson #4). \n\nApart from these generic analyses, in my experience, the drive of entrepreneurs is the #1 success factor<\/strong>. The management team must be willing to go all-in, with maximum skin-in-the-game<\/em> (both in terms of savings and time!), with nothing less than the goal of wanting to build the world’s best scale-up in your field. Good founders are social, but I see them (unsolicited!) continuously sacrificing themselves in social areas. When things don’t work one way, they determinedly continue with inexhaustible stamina and energy to tackle the problem another way. These entrepreneurs can, incidentally, expect the same attitude from me as a shareholder. \n\n#2. The founder\u2019s dilemma<\/span><\/strong>\n\nFact: in only 25 percent of start-ups with an IPO, the founder is still the CEO. While I consider ambitious entrepreneurs an absolute must and I applaud it when entrepreneurs set everything aside to become ‘the next Elon Musk’, I consider the flexibility and willingness to let go of control even more important. The simple truth behind this is that founders are rarely still the most suitable CEO once the organization exceeds the threshold of approximately 25 people<\/a>. See this Harvard Business Review article<\/a> for a good explanation of this. The required qualities of a leader are simply different in the research phase of a young tech company than those of a scale-up with 50 FTE. \n\nFrom my own experience: in a number of companies in our eleven, this has not been an issue at all; in some cases, the founder himself indicated that he saw himself in a different role in the future (fantastic!); and in other cases, this transition required the necessary push from us as shareholders. When this proved necessary, the transition from founder to a new CEO was the most challenging hurdle to overcome. On the other hand, in almost all cases, this did bring the desired change and clearly helped the companies over important hurdles towards scale-up status. \n\nMy advice to investors:\n