Why Scaling A StartUp Can Feel Like David Vs. Goliath

By: Jeff St Onge

You’ve probably heard countless statistics about start-up failure rate after one, three or five years. It’s likely that only half of them are authentic, but one thing IS for sure: successfully scaling a start-up can feel like a David vs. Goliath type battle. David vs. Goliath tells as the ultimate underdog story, David takes on the giant Goliath and slays him with a stone, representing the tremendous courage of ‘the little guy’ and the fact that anything is possible, even against the insurmountable odds. 

In comparison, the 21st Century entrepreneur fights to survive, scale and chisel away market share against some of the most formidable economic forces this world has ever seen; the Fed, Amazon, Facebook, Apple, Walmart, whomever etc, etc. Even at a lesser degree contending with middle market companies can be a tall order when new, unknown and undercapitalized. While some would say this ragged group of dreamers coining themselves “entrepreneurs” suffer from delusions of grandeur, others would recognize the fact that society wouldn’t be pushed forward without them.

As Malcolm Gladwell re-states George Bernard Shaw in his book that targets startup culture David & Goliath, Underdogs, Misfits and The Art of Battling Giants  “The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” 

Well stated, but what’s left out of this bit is the part about the painful process that happens during progress. As someone who finds more satisfaction in a hard fought journey than a fancy destination, I have drudged through the first four years of founding & operating an AdTech Agency with my fair share of war stories. But that doesn’t skirt the fact that it’s TOUGH – mentally, physically, psychologically and emotionally. You’ve heard it before, right?

But I’m talking about something a little different, not the life sacrifices that to me, are par for the course. The constant weekend and late night work sessions, abysmal work/life balance, cheap meals, judgement of friends or family, sleeping on couches, risking all personal capital, etc. All of that is easier to internalize and is usually enough to get you off the starting blocks, but the technical and strategic execution of scaling and creating a sustainable long term enterprise that can solve a massive problem and take market share from major players, THAT’s the real bear.

To throw a bit more weight on your shoulders, let’s factor in operating WITHOUT seed money (like we do at J. Arthur & Co), IE they actually selling things by adding value, learning how to earn a profit and re-invest into fundamental, long-term growth. While the façade of pop-culture venture money can make success appear far easier than it is achieved, tricking wannabe entrepreneurs.

Below is a chart by tech.co that shows the rate of failure in start-ups by industry. After just having skipped past the four year mark at J. Arthur & Co – this has some relevance.

But what this infographic doesn’t tell is size & industry relevance. Out of the 30 million businesses in America, 96% do LESS THAN $1,000,000 in annual revenue. While I’m a huge advocate of smallbiz, it’s safe to say you aren’t slaying any “Goliaths” at less than $1M/year. Some would say ‘the first million is the hardest’ (in sales, that is) but I adamantly disagree – all the most brutal challenges are north of the $1M mark. It’s far harder to create a vision, implement a strategy, hire intelligently, employ dozens, exist perpetually and successfully carve off market-share from industry leaders than it is to go from $0-1M. When you are obscure and little, the only place the go is up but when you now have built a sound company framework, the burden becomes heavier to take it to the next level and then the next, and the next.

But hey, this is what we signed up for, yeah? Shut up, put up, add-value and execute. The beat goes on.

Every entrepreneur, small or big, should embrace the David role because it adds some exhilaration to what can seem an unglamorous journey at times not worth taking. But if we’re keeping it real, it will take a whole lot of execution and an uncomfortable amount of courage to actually slay the giant.

Painting by Newport, Rhode Island Artist Romeo Ellorin