Debunking nine scale-up myths
Unravelling misconceptions about scaling in today’s business landscape
By Veroniek Collewaert
Professor of Entrepreneurship
What defines a scale-up? In the media, we often see the same group of usual suspects popping up: young and famous tech companies. They are typically the ones put in the spotlight – and, more often than not, in the context of big fundraising rounds. Governments, too, like to showcase them as perfect examples of entrepreneurial excellence. But have you ever heard of Arjessa, a Finnish company offering family and childcare services? Or Xenos, a Greek chain of boutique, luxury hotels founded in 1982? Or Hoorcentrum Aerts, a Belgian chain of hearing aid stores? These are scale-ups too.
If we want to talk about scale-ups, we first need to reach a joint understanding. Scale-ups are often equated with high-growth firms, which – according to the OECD – are companies:
- With an average annual growth – either in employees or turnover – greater than 20% per year.
- That can sustain that growth over a 3-year period.
- That have a minimum of 10 employees at the start of their growth period.
What is the problem? Our vision on scale-ups is too narrow. In recent years, the debate has advanced, so we’ve come to understand that scaling is about more than just high growth. Scale-ups come in many different shades of grey – in terms of industry as well as activities, innovativeness and age. The media and other institutions tend to underexpose the broader picture – resulting in a one-sided public opinion.
In this white paper, we pick apart nine recurring myths – and prove that scaling is much broader than what many of us might have imagined.
- Scale-ups are tech company
- Scale-ups are radically innovative
- All scale-ups raise venture capital
- Scale-ups are young companies
- Scaling is possible for everyone
- All companies want to (continue) to grow
- Scaling is all about the top line
- Scale-ups are the pinnacle of HR
- Scaling globally implies perfect standardisation
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