If you have ever watched Dragons Den, you can’t have failed to notice the frequent use of the word ‘scale’.
When investors look at a business, their main concern is how easily and fast can the business grow and increase the value of their investment. To answer these questions they take into account the attractiveness of the market, the competitive strength of the company, the people running the company, and what they themselves can bring to the party.
When companies scale, they add revenue at a faster rate than they take on new costs, increasing value and profitability.
Barriers to Scaling
However, scaling doesn’t come naturally to most tech businesses – common reasons being
- The skill set of the business is tech oriented, not commercial.
- They don’t understand the market or their competitors
- People like to stay in their comfort zone – no global aspiration.
- There just isn’t enough time to even start thinking about scaling.
- The real objective is to develop the tech to a point where it can be sold and let someone else exploit its true potential.
Overcoming these barriers is not easy on your own (and Dragons are in short supply!) – it requires time and expertise.
But, developing a clear, innovative scaling strategy that can deliver exponential growth is what separates the leaders from the followers.
And, a scaling strategy that delivers both growth and funding for ongoing R&D mean that you remain in the lead.
Scaling and Funding – connecting the dots
Two proven and successful innovation scaling strategies are licensing agreements and 3rd party sales channel agreements with key players in other geographical markets. ‘Instant’ access to new markets and customers can generate exponential revenue increases, whilst costs are minimised.
Some margin has to be sacrificed, which is why this route is generally more attractive to high margin digital tech businesses.
However, let’s say you have successfully managed to agree in principle a licensing agreement – it is obviously in both parties’ interests to maintain the competitive advantage of your product/service.
Bearing that in mind, as well as laying the foundations for scaling your business, there may be the opportunity for some clever negotiations at the start which result in an agreement that ensures funding for your ongoing R&D programme.
A guaranteed/up front income in return for licensing rights might be a more attractive option in the short to medium term, ensuring your company can confidently map out its R&D programme and keep its product at the leading edge of technical development.
Why using a partner like Infintec is worth considering
Using a specialist like Infintec can help you achieve the funding you need and the scaling your technology deserves. Our broad industry experience and market intelligence enables us to rapidly assess the opportunity, identify ‘partners’, negotiate agreements and put in place your scaling strategy. We call it our Maxima solution.
Our Fast-track, Paid-on-Results method of working minimises your risk and time commitment.
Using Infintec allows your company to explore new potential markets, new product sets and geographies using our skill set to expand your business.
What’s not to like?
Download our white paper ( ), call us on 01184 032994 or email [email protected] to see how we could help you achieve exponential growth.