Sharon Wienbar, Partner at Scale Venture Partners, gave a workshop on when to scale and how to avoid scaling prematurely. This was her talk at Vator Splash Oakland. Scale Venture Partners focuses on "growth-stage" investing. Most of the companies she invests in are already growing revenue. Most have under $4 million in revenue, but Scale has invested in companies with as little as $200,000 in revenue.
Here she talks about team dynamics and alignment around scaling, as well as whether a product is really ready to scale. She asked the question: "If you started to spend more, would you get at least the same or better result?" Great marketing and PR isn't a scalable source of cusotmers, she pointed out. Having a scalable channel to market is when "you find paid channels and you have the ability to spend more money without metrics deteriorating."
In addition, people mistake having a minimum viable product as having product-market fit.
Having product-market fit is beyond having a minimum viable product, she said. "If you give your product away, that doesn't mean it's scalable."
Watch the video for true gems around this topic.
Save the Date: Splash LA is Oct. 2 in Santa Monica. Speakers include Jessica Alba and Brian Lee, Founders of The Honest Company, Michael Heyward, Founder & CEO, Whisper, Mike Jones, Founder & CEO, Science, and many more. Register here.