Are you unsure how to achieve growth and reach your ambitions as a B2B software company? Setting up an effective growth strategy will guide you in the right direction. But what is a growth strategy exactly? In the early stages, fast-growing B2B SaaS companies often have a range of possible growth paths to follow.
Both commercial and product choices have to be made and this might seem overwhelming.Should the company focus on a specific vertical? Are any particular customer segments more attractive? Which markets should you expand to, and by when?
What direction to take with the product? Does it make sense to develop a deep or broad product offering? And how to make the most of the current resources?
These are all questions you should find the answer through developing a growth strategy.
Written by Andreas Davies Sandbu, Head of Operational Excellence at Viking Venture
Having a large opportunity space for growth, both commercially and product-wise, is generally a positive for scale-up companies. However, having a range of options also comes with a risk. It may guide the company in a suboptimal direction due to lack of focus and pursuing opportunities ad hoc.
Most fast-growth B2B SaaS companies often have resource constraints such as access to qualified employees, product maturity, and capital. These constraints imply that focus – and using the resources most efficiently – is essential.
Defining and executing an articulated business growth strategy helps you focus. It forces you and your teams to prioritize key areas and align strategic initiatives across the organization. This in turn ensures you make the most of your current resources.
In Viking Venture, we work together with founders, CEOs, and management teams in our companies to get the growth strategy right. We also incorporate the corresponding strategic initiatives and core enablers.
When we invest in a company, the company has a clear vision. It also have a well-proven market fit for their products or services. However, many companies often lack a clearly articulated growth strategy which links vision and ambition with concrete strategic initiatives. Having a growth strategy in place has multiple benefits, among others:
Furthermore, you need to have a clear view of where there are room for growth. We often like to divide the market development strategies into “Where to play” and “How to win”. Following that we build a value creation plan with concrete initiatives, timelines, financial targets, and other KPIs helps realizing this.
Getting the growth strategy right has many benefits for B2B SaaS companies. The aim should be to execute this growth strategy efficiently in a fast-growth environment with limited resources. However, it is essential to highlight that a growth strategy is not carved in stone for the next 3-5 years.
Market conditions might change. The company’s development might not go as planned. New attractive opportunities might arise and unforeseen events might happen. One benefit of a smaller company is the ability to be agile and adaptable.
Therefore, B2B SaaS companies need to leverage these benefits by reassessing and updating their growth strategy from time to time. The assessment will help you establish the right priorities. As well as, defining whether the focus areas are correct as the company develops over time.
Our next article on strategy is a practical framework for getting your B2B SaaS growth strategy in place. By breaking down the key elements of growth and identifying the levers you can pull. This strategy framework provides a clear structure for you to follow as you develop your growth strategy.