Entrepreneur lesson #4: The leadership team almost always is the bottleneck for growth

Most of the companies I’ve worked with tended to plateau at different sizes. At that point, their growth tapered off and typically there was a general concern in the company that we had hit the peak of the business.

Although there are many reasons why a company may plateau, there are three patterns I’ve seen happen. The first is that the company faces difficulty in transitioning from serving innovators to the early majority of the customer base. Of course, Geoffrey Moore’s book “Crossing the chasm” is a classic on this topic. The first customers of the company tend to be innovators and risk-takers who may become customers just because you have an innovative offering they believe in. The early majority of customers requires clear evidence that the solution you’re selling them delivers business value that significantly outweighs the effort required to change and that overcomes the associated inertia. Shifting the customer base from one to the other requires changes to how you sell, the functionality of the product, the stability and reliability of the solution, and so on. Suddenly, the things that made you successful initially are no longer sufficient to convince the next group of customers – and growth stalls.