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The Scaling Challenge

There is a meme that goes around and I have no idea of ​​its age or its origins, but I've heard two times last week. It's easier to start a business than to scale it up. You can not say that it's a revolutionary thought, but for the past 20 years, the focus has been on the foundation, so it's a bit of a departure.

Startups do not grow on the moon on average, for example if We did not have Salesforce Do we even remember the dot-com boom at the turn of the century? There were a lot of startups, some failed and many were bought, and their names disappeared. .. So we have a lot of experience and data on what to do … – and just as importantly, what to avoid – in starting a business .

No guide for the user

A typical example: venture capitalists typically look for a business model and a minimum viable product (MVP) in the early rounds, and they want to see a repeatable income model later, while they're trying to Bring a company to the market. Not having, or even not having, is death. It's far from the time when commercial proposals were written on cocktail napkins.

There are no definite formulas on how to evolve a business, once the MVP is not so minimal and the income model is predictable enough. We can have a lot of memory on this phase, but it is nothing like the first days.

At the same time, once a business has reached the relatively calm waters of the early adulthood, you can bet that the market has changed enough to be rethought. The impulse to do it all at the same time is just as prevalent among young adults as it is among the youngest, but it is also more perilous. The startup fault occurs all the time, but failing after the initial success can be very painful because so many things continue to flourish.

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It was refreshing, therefore, to see how NetSuite was facing success when I attended analyst events at SuiteWorld '18 in Las Vegas. In his young life, NetSuite was a startup, an IPO candidate and an acquisition target.

Stay the course

Now part of Oracle, NetSuite still has a lot of work to do, but it is still able to take stock of where it has been. Executive Vice President Jim McGeever and Founder and Senior Vice President of Development, Evan Goldberg, were able to provide a compelling and realistic presentation of NetSuite's approach to the market.

"We will not boil the ocean," Goldberg said repeatedly, stressing the company 's commitment to staying on track. The goal is to provide functionality to NetSuite customers while avoiding the pitfalls of more complete development projects that could scratch a search problem, but which would not necessarily provide any utility to customers.

Part of the merit of this approach should probably go to Oracle. Since she bought NetSuite, she has provided money to expand her operations – from, for example, 60 to 600 salespeople in EME – while exerting a slight influence on operations. He has also contributed to sound management.

One of the reasons for NetSuite's success was perhaps the continued involvement of Larry Ellison as a member of the board of directors and co-owner during the formation years of the company. With Ellison's influence, it's hard to see how NetSuite might have failed to become a good candidate for acquisition.

Focus on micro-verticals

In terms of scaling up a mid-sized company, NetSuite has focused on its customers in its announcements and interviews with customer CEOs. A good example of its goal has been its SuiteSuccess program, designed to eliminate the pain and risks associated with the integration process, especially for small customers.

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Another good example is NetSuite's focus on micro-verticals, where it aims to provide 80% of the necessary back-office functionality, in order to speed up the integration and integration. l & # 39; adoption.

There are 33 micro-verticals for 14 industries, and there is a need for more, according to McGeever. There is no doubt about that, but it might have been helpful to say more about the tools and technologies that provide the remaining 20%. There is no doubt that the technology is available, so messaging should follow it more closely.

That said, NetSuite seems to benefit from the acquisition by accessing Oracle's resources – including its money and brain – to evolve at a time when it can be put to work with success.

My last point, that financial analysts may not have calculated: The new Oracle data centers moving around the world will be perfect for products like NetSuite, which is experiencing significant growth outside of North America (more than 80% recently). The company intends to prove it when the German data center becomes operational.

It seems that it will not be too difficult to fulfill these functions, which will allow Oracle to continue its cloud deployment.

The opinions and opinions expressed in this article are those of the author and do not necessarily reflect those of ECT News Network.

Denis Pombriant is a well-known analyst, strategist, editor and speaker in the CRM industry. His new book, You Can not Buy Customer Loyalty, but You Can Earn It is now available on Amazon. His 2015 book, Solve for the Customer is also available here.
Email Denis.

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