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How to Scale a Business – a conversation with Ashish Gupta founder of ScaleUpExec.com
12 Plays3 days ago
Build a business to the size you want.
Ashish Gupta had a successful corporate career and successfully scaled and sold two of his own businesses, before founding ScaleUpExec.com a provider of fractional Chief Operating Officer services.
In this episode of the Abeceder podcast The Independent Minds Ashish and host Michael Millward discuss the trials and tribulations of scaling a business.
Their conversation covers how
- What scaling means to different entrepreneurs
- The key factors of scaling a business
- The different mindset of founder and business scaler
- Identifying the scaling gap
- How to bridge that gap
- The Management juggling act
- Macro leadership -v- micro management
- The importance of Key Performance Indicators and the primacy or data over opinion.
This is the podcast for any business person who wants to scale or turn-around an existing business.
Discover more about Ashish and Michael at Abeceder.co.uk
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Transcript
Podcast Introduction
00:00:05
Speaker
Made on Zencastr. Because Zencastr is the all-in-one podcasting platform that really does make every stage of the podcast production process so easy.
00:00:16
Speaker
I recommend that you use the link in the description to visit zencastr.com and take advantage of the built-in discount. Hello and welcome to The Independent Minds, a series of conversations between Abysida and people who think outside the box about how work works, with the aim of creating better workplace experiences for everyone.
00:00:40
Speaker
I am your host, Michael Millward, the Managing Director of Abysida.
Guest Introduction: Ashish Gupta
00:00:45
Speaker
Today Ashish Gupta and I are going to be discussing the challenges of scaling a business.
00:00:52
Speaker
Ashish is the founder of scaleupexec.com. Ashish has built and scaled two of his own businesses and then sold them. He also has many years experience leading high impact teams at Apple.
00:01:07
Speaker
He has encountered firsthand what leads to business stagnation and then led those businesses to break out of that stagnation and build to fulfill their potential.
Challenges in Scaling Business
00:01:16
Speaker
In 2024, CEO Monthly magazine recognized Ashish as the CEO of the year in the fractional executive industry.
00:01:27
Speaker
Ashish is based in Virginia, USA. It is one of the US states that I have visited. If I visit again, i will make my travel arrangements with the Ultimate Travel Club. because as a member of the Ultimate Travel Club I pay trade prices on flights, hotels, trains, holidays and all sorts of other travel related purchases. I have added a link with a built-in discount to the description so that you can become a member of the Ultimate Travel Club and travel at trade prices.
00:01:55
Speaker
Now that I have paid some bills It is time to make an episode of The Independent Minds that will be well worth listening to, liking, downloading and subscribing to.
00:02:05
Speaker
And probably good enough to share with your friends, family and work colleagues. As with every episode of The Independent Minds, we will not be telling you what to think, but we are hoping to make you think.
Ashish's Entrepreneurial Journey
00:02:18
Speaker
Hello Ashish. Hi, wonderful to be here with you today. Thanks for having me. Great privilege. I'm looking forward to our conversation, especially as I think personally, there are probably going to be a lot of things that I can learn. But please, could we start by you just explaining a little bit about your history and the sorts of things that you've done?
00:02:36
Speaker
Yep, sure. I've been in tech most of my career. i was previously the co-founder of a wireless company. i don't know if you've seen in many cell phones now, they have wireless charging built into them. So we actually developed the early technology for that. It was one of those starting in a garage type stories where my friend and I, we were we came up with some interesting technology and then eventually we got funding and then eventually started building out a team and then selling it and Grew the company. It was, after a few years, it was acquired by Qualcomm, which is a Fortune 500. I was with Qualcomm for a few years, helping transition the technology. And then I shifted to Apple and i was eventually leading a pretty sizable worldwide operations team and $2 billion a year budget, managing operations and ah manufacturing and supply chain for their iPhone. Eventually I had the entrepreneurial bug again. i quit Apple.
00:03:29
Speaker
I acquired myself a distressed e-commerce business and then spent four or five years turning every aspect of that business around from the team, the culture, the sales channels, our margins, and And eventually the business did turn around and it was acquired in 2023.
Business Intent and Need for Scaling
00:03:49
Speaker
Thereafter, I had the chance to help a few small, medium-sized businesses as a fractional COO, which means that these were businesses where either the founders were stuck, their revenues had plateaued, they weren't sure how to get it to the next level, and ah their teams were burnt out. Within a few months of me retooling their businesses, ah got them back on track, and they started growing 30%, 40% just in the first three, four months of me working with them.
00:04:15
Speaker
Eventually, i had more engagements than I could handle myself as a fractional COO, and that's when I started ScaleUp Exec. So we're we're a team of ah fractional COOs that jump into businesses to help them unlock growth and get to the next level.
00:04:30
Speaker
Certainly a wide range of experience in it. And so you say it very casually, but you were involved in the manufacturing and distribution iPhones. So very relaxed, but I'm sure it was a very high pressured role. It was a very fascinating place to be at Apple.
00:04:45
Speaker
You exited your own businesses. You've been an entrepreneur. You've then been helping entrepreneurs to run their businesses. The big question that we've got to start by asking, I suppose, is why did businesses fail to scale?
00:04:58
Speaker
Yeah, I guess one of the first points is it's not actually necessary for every business to scale. Yes. So for that, I think it's first important for a founder or a CEO to understand what is it that they actually want in their business.
00:05:12
Speaker
Some CEOs, founders, they might actually have a ah mindset that every business needs to scale. But the reality is their theirre deep down interest is just to get cash flow or just to have stability in their business or make it a lifestyle business. And that's totally okay.
00:05:27
Speaker
and So actually that's the first question is, do you want the business to scale or do you want it to be a stable stable business? If you want scale, it requires a different amount of personal investment in terms of time, your energy space, as well as finances.
00:05:44
Speaker
So it's quite different versus if you want a business that once that is stable and steady. that That conflict in CEO or founder's minds often is one of the issues that allows a business to fail to scale.
00:05:57
Speaker
And so it's actually okay to not scale if that's what you truly want
Evolving Entrepreneurial Goals
00:06:01
Speaker
out of your business. Yes, you're reminding me of when I started Abuceder and I went along to various different events that were being run by business membership organizations. And meeting other people who were also starting their businesses. We were all going to be millionaires this time next year.
00:06:18
Speaker
You meet those other people a couple of years later and, well, are you a millionaire? And it's sort of like, well, that that stopped being important. And I reconnected with what it is that I really wanted to do. And that was to do something specific have a particular lifestyle, offer a particular product or service. And as long as they're doing that and their bills are being paid, then that's great.
00:06:44
Speaker
But like you say, other people have ambitions beyond that and want to build a ah big business. Those are the people that you're saying have got to understand what scaling a business means and what it involves. So if you are an entrepreneur or you are you do own a business which you want to scale,
00:07:04
Speaker
What do we mean by scale a business? What's the what's actually involved? First thing is, let's say now you've you've come to that realization that deep down, yes, you do want the business to scale or grow. Next step is to figure out your unique skills and places that drive energy for you. So let's say if you were to take a view into your last couple of weeks, all the different activities that you did,
00:07:28
Speaker
And then you classify them based on these are the things that I'm really skilled at or these are the things that I'm not skilled at. And then these are the activities that when I do, they actually give me energy or I feel i feel energized after having completed those versus these are activities that drain my energy.
00:07:44
Speaker
And then now finally, you also look to see which of these activities are actually moving the needle for your business versus not. So now once you understand these things, the the types of activities that you are skilled in, the ones that ah you feel energized by doing, and then the ones that actually move the needle, then you'll start seeing, well, what are the different gaps that exist in the work that I'm doing?
00:08:08
Speaker
towards growing and scaling the business versus the things that are actually holding me back. Eventually you might realize
Effective Delegation and Team Building
00:08:14
Speaker
that there's a bunch of activities that you're doing that you're not really skilled in or not moving the needle for the business.
00:08:19
Speaker
And so maybe you can look at ways to find the people who fill the gaps of your skills. So that's often what happens. Like, let's say there's a CEO might have a right hand person of a COO, where a CEO ideally should be focusing on vision and strategy, assuming that's what they're skilled at.
00:08:36
Speaker
And then they have a COO who focuses on executing that vision and strategy, because that's probably what they're good at. So it's good to understand and ah take inventory of all those things that you're really good at and not good at, and then find the right people that can fill in those gaps. And also you can delegate things to that you ideally should not be doing as a CEO.
00:08:59
Speaker
So I often find that as CEOs, people are either great strategists or visionaries, or they're really good at execution. Probably 90% of people that I've come across are not good at both. And so if you understand which of those two you fit into, then you can find the person who can compliment you and When I did my master's degree, the dissertation, i was studying entrepreneurs in different parts of the world and looking at exactly what you've just described there and how they grow their businesses. Too many entrepreneurs, if they were really honest with themselves, their biggest weakness was that they didn't like to share the responsibilities of running the business because it was their business. And they had this sort of attitude that like,
00:09:42
Speaker
they could do everything and they were the best at everything because they hadn't gone through that process that you've just described of working out why is it that I'm running this business? Why did I set it up? What are the best skills that I've got in order to make it successful and grow it? And where do I need to bring someone else in to do the things that I don't really want to do or I haven't got the time to do or i don't have the skills to do? Exactly. And this is sometimes just a natural evolution when you started the business and it was just you and maybe one or two other people, Max.
00:10:16
Speaker
At that time, maybe you did have to do everything. But at some point, when you feel like you've got an interesting sales model that's continuing to drive new revenue for you, And you've got an interesting product or service that people are actually finding value of.
00:10:30
Speaker
At some point, you will have to take a step into a more focused role and have other people come in and take over things from your plate. And that initial time you do that, where you transition from having a bunch of things on your own plate to now starting to delegate or utilizing the skills of others.
00:10:46
Speaker
ah there is a bit of trust factor that's needed. And there's a important ah delegation plan that you should be putting together to make sure that when you do delegate, things don't get dropped and that you feel confident that they're being done by others in the way that you would want them to be done. So it is possible to do it, but it does require that leap of faith and proper planning to make sure that it actually goes well, the the delegation transition.
00:11:12
Speaker
Yeah, and the leap of faith is not necessarily in the people that you're delegating something to. Very often it's in yourself as the founder, the leader of the organization, the manager in the department. Am I trusting myself to do it? The first time that I was given someone to manage and um I briefed them on what they were going to be doing, went through all the the training sort of things. if that's I was running a training department at the time and then they went off to the meeting And for some reason, I found no end of reasons to just walk past the meeting room. Because if he sees me and he needs me, then he can he can call me in if he needs me. That was the logic. But the problem was that I didn't have confidence in myself at the time to have made sure that I had done everything I needed to, to delegate things effectively to him. Because it was a learning curve for me at that time as well. And I suppose lots of entrepreneurs go through exactly the same type of situation. Yep, Exactly. Everything that you're talking about is about the entrepreneur, the manager, the business owner, having to look at themselves first before they look at other people in the organization.
00:12:20
Speaker
Exactly. That's where it all starts. And it's same with even culture. So let's say you want a certain type of culture in your company. It has to actually start from the leader. And once the leader knows what they want and they start living it themselves, then now it starts flowing into everything in the company. So I think a lot of things in terms of scaling start from the founder or CEO or the the leader. Yes. And it's this idea of identifying why it is you set the business up, why it is that you wanted that job, what it is that you enjoy about all the different things that you can do.
00:12:54
Speaker
And then what are the things you don't enjoy? What are the things that that someone else could do better because they've got different training, different skills? write them down so you can construct the job that is going to be done by the person that you're going to bring in or already have but need to delegate more to.
00:13:13
Speaker
You're starting that planning process rather than just, oh, do this for me. It's all planned out.
Using KPIs and Scorecards
00:13:19
Speaker
Everyone knows what it is they're supposed to be doing, by when, how, all the quality standards, everything, so that you can you're building in through that system the confidence that what you want done will be done the way that you want it done. Yes, exactly. What happens next? Just ah refreshing, you first start off with really understanding yourself and what gaps exist.
00:13:41
Speaker
You bring on people who can fill in those gaps. And then now you create delegation plans. I usually like to start off small. So you start off with one task that is smaller in nature or maybe less critical. You come up with a ah plan on timeframe, the type the right type of training, and then ah regular check-ins to make sure that things are going in the right direction. And ideally, I also like to create some KPIs and some way to measure those KPIs. So let's say you're delegating some sales function and maybe around cold calling as a just an example. Maybe around that cold calling, you have some metrics that you come up with around a number of calls per day, and then another metric around a number of connected calls and another metric around number of positive leads generated from those calls.
00:14:32
Speaker
So now if you have these KPIs in place and you ask the person you're delegating to to now start keeping a track of these, ideally in some system that you can view at any time. Now you'll be able to much more easily ensure that things are going in the right way without having to talk.
00:14:48
Speaker
You can just see it in ah in a system or a scorecard. And if you notice that something is going in ah off of what you would expect, now you can also quickly set up a meeting and then course correct with that person. So a strong delegation plan, I think, is is ah really important. Now, once you've started offloading things that are less critical or less use good use of your skill set off of your plate, now you will hopefully have some bandwidth and time to start thinking about next. You should be a few months ahead of everybody else in the company.
00:15:23
Speaker
You should be thinking through ah ideally what's next. And I actually really like this concept of a scorecard in an even broader sense. where in most companies that we work with as a COO, we'll first identify what are the really important, maybe let's say the five to eight most important metrics that'll help me get get a pulse on the company.
00:15:48
Speaker
ah So whether that's on the sales side, whether it's on the margins or cost side or something in between or with the team. So now identify these few key metrics that will help me ensure that the company is going in the right direction without me having to ask people.
Client Diversification Risks
00:16:04
Speaker
and create some kind of system, this data can feed in into this tool. So you can view it at any given time. And so that's one important piece is a scorecard or or metrics, a view of key metrics.
00:16:19
Speaker
So it's about building information about the organization. So you don't necessarily have to talk to someone to get the information, but you're looking at that information with the critical eye of, okay, what does this tell me about what needs to be improved or what might be on the verge of needing to be improved. Exactly.
00:16:40
Speaker
What often happens if you were to try and get this information just through discussions is that people might add their own bias. Yes. Like if you talk with a sales team, they might add their own bias about what's actually happening on the ground. But if you now instead look at numbers that flow in, ah the bias is removed.
00:16:58
Speaker
you can actually get a real view into what's working and what's not working or what needs to be addressed in more detail. yeah So this is just like a helpful tool to help you dive into things. And this might also be a financial metrics. So maybe there are certain financial metrics that you're keeping tab of that'll help you understand how the business is operating. So this will often help you diagnose your business. So if you are stuck in some kind of stagnation,
00:17:26
Speaker
This will help you diagnose. Maybe your margins are are so slim that you're not able to generate enough cash to help fund future growth investments. For example, one of our engagements, that when we jumped in, we realized that their pool of customers was very small.
00:17:41
Speaker
They were mainly going to referral sources or their own personal networks for generating new leads. And at some point very soon, that was going to tap out given the size of their small network. Very quickly, we started figuring out, well, how do we diversify their lead sources and start bringing in new ah channels to get new leads that are not just dependent on their on their current network.
00:18:05
Speaker
And in that case, it actually worked out quite well because a few of their customers, they they had big customer concentration. So there was a small number of customers that generated 80% their revenue.
00:18:16
Speaker
And it's always risky in that case that one of the customers leaves and then all of a sudden your business is in a critical mode. And yes in fact, that
Leadership Styles and Adaptation
00:18:25
Speaker
did actually happen. One of their critical customers that was generating more than 50% of their revenue left because they had some, their own internal issues. But luckily we had already started scaling up new sales channels. And so we were able to fill in and grow in new ways.
00:18:42
Speaker
These are all ways that you can, Now quickly understand what are some of the problematic areas for you to address. Yes. I know several businesses that have got with more than 50, 60, 70% of their business coming from one client. You only need the person who is your contact in that client to leave. Someone one else comes in with different ideas.
00:19:05
Speaker
And you can be out, you can lose a lot of business overnight. You talked about someone thinking a few months further ahead than anyone else in the business, which is sort of like macro leadership.
00:19:19
Speaker
But also with the dashboards and the KPIs, that has a feeling about being quite micromanagement. or could be micromanagement interpreted in that way by the people that you're managing if you don't get that KPI management process correct.
00:19:39
Speaker
But I suspect that as an entrepreneur, your main aim should be to move from day-to-day micromanagement of issues into much more of a macro scenario. How do you find people, apart from the delegation, how do you find people making that shift It can go either direction. So you're right that some people might end up feeling that if a leader doesn't think of it appropriately, it could go in the direction of micromanagement. So it's really the subtleties of how now you take, let's say, for example, you've got a scorecard or a dashboard that exists now where different metrics are flowing in to it.
00:20:17
Speaker
And from that, you identify that there's a problem area in sales, right? but Now you've got different ways of addressing this. First is ideally you really understand your team because you'll eventually realize as a good manager that you cannot have a one size that fits all management style, at least from what I've observed to be best. Some people in your team, you'll actually want a manager that is much more hands-on with them versus other members of your team will actually want to manager that is more trusting and more hands-off.
00:20:50
Speaker
And so if you're trying to apply one management style to all of your team members and expect that they're all going to be equally successful, it's most likely not going to work. True. So in that case, it's actually important but what I've seen as a manager to understand each of my team members and how they work best.
00:21:09
Speaker
And then now i take that understanding and apply a management style that's actually relevant based on that. So maybe some of your team members, once you identify an issue, you actually decide that, okay, I'm going to get more hands-on in this area myself. And you understand that from that team member, they like that mode of operating. They like when their manager is much more hands-on. Yes.
00:21:30
Speaker
But still through that, you continue to have trust, confidence, but you're not afraid to put in the right accountability mechanisms to help ensure people are going in the right direction.
00:21:41
Speaker
So it it often ends up being specific period of time that you might get hands-on if there's a real problem in the area. And then you leave once you have confidence and you the right accountability mechanisms in place. Yes, it's not a case of saying, well, I'm going to do it for you, watch and learn. It's more a case of saying, I might be the manager, but let's work it out together and enable people to be actively involved in in whatever work needs to be done.
00:22:07
Speaker
It is, know, I run management training programs, leadership training programs all over the world. And it is one of the key messages that as a manager, you will have a natural management leadership style.
00:22:18
Speaker
In an ideal world, all of the people on your team will respond best to your natural management style. Unfortunately, that is very rarely the case. So as a manager, you need to understand yourself and manage yourself in the most appropriate way. Then also understand how you need to adapt in order to then communicate most effectively with the members of your team on an individual
Hiring for Complementary Skills
00:22:44
Speaker
basis. And then how are you going to do that effectively? How are you going to communicate effectively with them when you've got two of them in the room and they respond best to different management styles? So it can become a little bit of a of a juggling act.
00:23:00
Speaker
Tell me more about ScaleUp Exec. Yep. And by the way, it sounds like I must have taken your your ah training class because we have very aligned ways of thinking, which is great.
00:23:11
Speaker
We do. i think I think you were there, right right at the front. You bought me an apple at the end of the day. yes But it's it's common sense. But unfortunately, many managers and especially people running businesses, entrepreneurs, because they're so focused on making the business a success and they take on all the pressure of making that business a success on their own shoulders. They can so start to see things in a less than positive, constructive way when you're talking about how to scale a business.
00:23:43
Speaker
I've spoken with entrepreneurs who have said, you know we need to find some more people as well. Tell me about the people that you need to. You need to recruit. And they go, well, I want someone like me. I think you definitely do not want someone like you. First of all, the person who is like you is more likely to be your competitor than your employee. Entrepreneur and an employee are very different personality types, but also...
00:24:06
Speaker
You wouldn't want more than one of you in an organization. You need you to be you, but you then need, as you've said right at the beginning, those people who can support you to do the things that you want to achieve, not just another version of you.
ScaleUp Exec's Approach
00:24:22
Speaker
Exactly. You could have very happily, I suppose, have existed as a single self-employed person doing the occasional bit of interim fractional COO, chief operating officer type work for entrepreneurs and businesses. But you set up a business and it's called Scale Up Exec.
00:24:43
Speaker
Yep. Please tell me more about how that works. Yeah. So scale up exec, everybody in my team is, I'm just focused on really top tier talent. So everybody in my team has scaled businesses from zero to eight, nine figures, gotten them in many cases to exits.
00:24:58
Speaker
And so we've got really deep hands-on experience with doing this and, and doing it again and again in many different industries. So we work across wide, wide variety of industries and Our smallest customers are maybe a million dollars in a year in revenue and largest around 30 million a year in revenue.
00:25:18
Speaker
So the organizations that you work with are already quite large in terms of being an entrepreneur-led business. They're already quite large, but they need to move to the next level and beyond the next level. Yeah. So typically there's already a team now in place in these businesses and our smallest teams that we work with are end up being maybe four or five people.
00:25:39
Speaker
And so they're they're they've now got to some kind of interesting product or service and they're either plateaued or stuck. And actually some of our customers are also on a decline and many of them are in very difficult situations and they need real help to turn around.
00:25:54
Speaker
So we often have turnaround situations. We also work on a lot of stagnation situations where business is flatlined. And then we're also working in many scale up situations where the business is already growing and now you' it's starting to feel the problems and all the the cracks ah throughout the organization and their processes. And so we end up working on helping create well-oiled machine there.
00:26:18
Speaker
So we do work in these three different types of scenarios. We're not advisors. So that's one thing that I'm very clear on. We're not the type of people that come in once a week, give you a bunch of things to do, and then you go off and execute.
00:26:31
Speaker
ah We're actually the ones who work on strategy, but then roll up our sleeves and do the work. So that we're true COOs in that sense, where where we we think and strategize, but then actually do the work as well. It's an interesting thing because there are quite a lot of businesses and individuals operating as like, I will tell you what to do. We'll have a nice lunch and then I'll disappear for a month or a week or however long. And you can feel a little bit left on your own wondering what to do next.
00:27:01
Speaker
It certainly sounds very interesting. Whereabouts in the world does your business operate? ah where ah Most of our customers are in the US and then we have some in Europe and ah Israel and Middle East as well. So we're we're kind of mostly Western countries.
00:27:16
Speaker
Where can people find out more information about ScaleUpExec? Yeah, our website, scaleupexec.com.
Closing Remarks and Listener Engagement
00:27:23
Speaker
You can find quite a bit there. You can even book a call with me directly if you just even want to bounce some ideas off. I'm happy to be a sounding board.
00:27:31
Speaker
So that's that's probably the best place to find us. Well, that sounds great. Thank you very much, Anish, for helping me make such an interesting episode of The Independent Minds. I really do appreciate your time. Thank you. Thank you. I am Michael Millward, the Managing Director of Abbasida, and I have been having a conversation with The Independent Mind, Ashish Gupta, the founder of scaleupexec.com. You can find out more information about both of us at abbasida.co.uk. There is a link in the description.
00:28:03
Speaker
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00:28:46
Speaker
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00:29:01
Speaker
I'm sure that you will have enjoyed listening to this episode of The Independent Minds as much as Ashish and I have enjoyed making it. So please give it a like and download it so you can listen anytime, anywhere.
00:29:14
Speaker
To make sure you don't miss out on future episodes, please subscribe. And you probably will want to share the link with your family, friends and work colleagues, especially those who are running businesses.
00:29:27
Speaker
Remember, the aim of all the podcasts produced by Abucida is not to tell you what to think, but we do hope to have made you think. Until the next episode of The Independent Minds, thank you for listening, and goodbye.