Four business strategy myths that quietly stall your scale-up

Which business strategy myths are holding your scale-up back?

Amazon Web Services had nobody you could ring. That was enough for us. If your hosting fell over, you needed someone on the phone, so how was this ever going to work?

I’d spent a big chunk of my working life at Rackspace and then Peer 1. This was our business. As I told Tendayi Viki on my podcast: “I must have spent weeks in meetings where everybody just agreed with everybody else in the room that AWS wasn’t a threat because it was completely ridiculous.”

We knew what good hosting looked like. AWS wasn’t it. And rather than wonder whether our idea of good hosting might need updating, we went back to agreeing with each other.

Easy to laugh at now. When picking up the phone was your entire moat and premium, an outsider dropping it didn’t feel like a strategic threat. It just looked like shoddy service. Of course leaving it out looked daft.

Until you realise the customer wants the result, not your way of delivering it.

Once you fall into that trap, every bad strategic habit kicks in. You convince yourself you’re being prudent: waiting for more data, chasing volume, polishing delivery, and defending what you’ve built.

It feels like discipline. In reality, it’s just stalling.

Myth 1: should you wait for clarity before you move?

When Steve Sharp introduced a four-day week at NUVO, I asked whether they’d tried it in one office first. They hadn’t. The trial covered the business, around 100 full-time-equivalent staff at the time.

“Yep, big bang. It was done for a three-month trial period initially.”

Would the work still get done? Would clients still be happy? Sharp said productivity stayed broadly the same, while non-chargeable time and sickness fell. Other changes were happening too, so the shorter week can’t take all the credit.

They could have spent those three months debating whether it would work. Instead, they found out.

Jeff Bezos described this distinction in his 2015 shareholder letter as one-way and two-way doors. One-way doors are irreversible commitments. Two-way doors let you test an idea, see what happens, and walk back if it fails. Most commercial bets are two-way doors, but scale-ups treat them like irreversible gambles, and stay paralysed.

Commissioning another report or debating it in another meeting feels like progress, especially when the current revenue is still paying the bills. But you cannot analyse your way to certainty. The only way to find out if customers want what you’re building is to put it in front of them.

Myth 2: does being bigger make your business safer?

Founders often assume safety lives on the other side of a milestone. Get to £10m, hire 50 people, or buy a competitor, and you will finally be safe. You can put the combined numbers in a spreadsheet, look at the headcount, and feel decisive.

At least you are bigger. But are you any harder to beat?

When Nick Holzherr started Whisk, his American rivals had raised five times as much cash. Back in 2012, building AI models meant buying physical graphics cards and stacking them in racks. If Holzherr had tried to match the Silicon Valley hiring costs and burn rate of his rivals, Whisk would have run out of money before shipping a product.

Instead of playing their game, he bypassed it. He built a distributed team across borders to find specialist talent at costs the business could sustain. Whisk grew to 120 people and was eventually acquired by Samsung, not by out-spending the market leader, but by refusing to adopt their cost model.

Size is only an advantage if it creates an edge the customer values. Better purchasing power might let you price at margins a smaller rival cannot touch. A deeper team might let you take on complex deployments others turn away. But if extra headcount simply means more internal coordination and slower decisions, size is a vulnerability, not a moat.

If every pricing query still sits in your inbox until Friday, a nimbler competitor whose front-line staff can answer on Tuesday will beat you every time.

Before you chase size, ask what capability it actually unlocks for your customer. If it just buys you overhead, why do it?

Myth 3: is operational excellence enough to keep you ahead?

Suppose someone has died and you need to ring a financial-services company about a claim. Would you rather speak to a person or a machine?

You’d probably say a person. When Nikola Mrkšić told me about bereavement calls at a PolyAI client, their first instinct was to get callers to an empathetic human as quickly as possible.

Instead, an AI agent answered, explained the exact steps to submit the claim, and gave them a clear route to a person if they wanted it. The result? Customer satisfaction scores were actually higher than when people handled the calls.

Why? Callers didn’t want an empathy script from a stranger while dealing with raw grief. They wanted procedural clarity, immediately, without having to explain their loss to a call-centre agent.

That exposes the fatal trap of operational excellence. You could spend a fortune training call-centre staff to handle bereavement with exquisite sympathy. You could shave 30 seconds off queue times and celebrate a slight bump in customer scores. But if the customer didn’t want to talk to anyone in the first place, you are just perfecting a process that shouldn’t exist.

Running the wrong process faster or cheaper is not a strategy.

Real efficiency frees you to fix the underlying business. When Aytekin Tank introduced AI to handle routine support tickets at Jotform, his team didn’t just bank the time as a cost saving. They used the freed-up hours to read the exchanges, find out why customers were getting confused, and fix the actual product and documentation.

Instead of getting better at answering support tickets, they eliminated the reasons people had to submit them.

And then Tank took it a step further: why stop at fixing support when you could rethink the product entirely?

Myth 4: should you defend your core business above all else?

Defending the core business sounds like common sense. Why risk the revenue engine that pays the bills to chase unproven ideas?

Because there is a dangerous line between protecting your revenue and protecting the legacy way you earn it. Your customers have no loyalty to your delivery model. They only care about having their problem solved.

That was the risk Jotform took. Tank gave a small team room to build a conversational alternative to forms. It was an existential risk: if customers talked instead of filling in forms, it could cannibalise Jotform’s core product.

The customers surprised them. They didn’t use the conversational tool to build forms at all. They started using it for interactive customer service. Instead of threatening the core, following the customer opened an entirely new product category.

You don’t need to burn the existing business to the ground. Jotform didn’t switch off form-building. But exploring what comes next requires real resources.

In McKinsey’s 2012 study of corporate resource allocation, companies that actively shifted capital and talent between business units earned 30% higher average annual returns than companies that simply rolled budgets forward by 5% each year.

The lesson for a scale-up is clear: a strategy to build a new offer, where nobody is taken off their day job and no real budget is carved out, is not a strategic choice. It’s a wish.

Defending what you’ve built doesn’t mean leaving every person and pound tied to the way you’ve always done things. It means being willing to reallocate resources to where the customer is actually going.

How can you challenge all four myths without betting the company?

Take one offer you sell. Explain what the customer gets without naming the product, your process or the way you charge. Then look at a recent lost sale or renewal. Can your explanation account for what they chose instead?

Use that choice to work through the questions below. Keep what still earns its place. You don’t need to change everything to take this seriously.

Before you spend money on a new direction, put one person in charge and answer six straightforward questions:

• How much can you afford to lose if it fails, without threatening the business?
• What promises are you making that you cannot walk back, even if you call this a trial?
• Which existing customer promises must remain untouched while you experiment?
• What concrete customer behaviour will prove this is working, rather than polite feedback?
• On what exact calendar date will you review the evidence and make a call, rather than scheduling another update?
• What result kills the test, what result funds it, and what happens if you do nothing?

You might need a test. You might already know enough to decide and have been putting it off.

If you’re going round in circles with your team, bring the offer, the customer evidence and the commitments to a business strategy coaching conversation.

If you started your business today, with the same customer need and the technology now available, how would you solve the problem?

If you’d build something different, will your next budget give it a chance?

Frequently asked questions about changing your strategy

What is the difference between strategy and operational excellence?

Strategy is choosing who you’ll serve and why they’ll buy from you rather than solve the problem another way. Operational excellence means delivering that offer reliably and profitably. You need both. Getting better at delivery won’t tell you whether you’re still offering something people want.

How can you test a strategy without putting your company at risk?

Work out what you need to learn and what you can afford to lose. You could seek orders in a new location before signing a lease. Remember the promises you make to staff and customers, too. Calling something a trial doesn’t make every part of it reversible.

When should you protect your core business rather than explore something new?

When customers still have a good reason to choose it and the return justifies more investment. You can explore an alternative without breaking your existing promises. Be clear about what you’re protecting, though. Your expertise and customer relationships may outlast the product you currently sell.

How often should you review your business strategy?

Set a regular review and agree what would bring it forward. If a prospect chooses a different type of offer, find out why rather than wait for the annual planning meeting. One lost sale needn’t change your strategy, but it might expose a belief you haven’t questioned for years.

How do you know whether your strategy has actually changed?

Look at what people are doing and where the money is going. If you’ve decided to enter a new market, someone needs time with those customers and less of their old work. When everyone’s week looks exactly as it did before, what’s actually changed?

What should you do next?

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Questioning your strategy feels uncomfortable when the current numbers look healthy. But waiting until growth stalls leaves you scrambling to react when customer behaviour has already shifted.

When your leadership team agrees on what you are actually betting on, you stop pouring time and money into legacy processes that no longer create a competitive moat.

That is the point of a real business strategy: choosing what not to do so your best resources go where the customer is actually moving.

Four ways to take this further

1. Book a call. If strategy debates in your executive team keep running in circles, Dominic can help you identify whether the bottleneck is market positioning, resource allocation, or execution drag. No obligation, no pitch. You will know quickly whether this is the right kind of help.
2. Grab the book. *Mind Your F**king Business* gives founder-CEOs a practical way to stop being the bottleneck and build a company that can scale without them in every room.
3. Explore business strategy coaching. Bring your leadership team, your strategic choices and your resource allocation to an intensive session designed to test your strategy against commercial reality.
4. Subscribe to the newsletter. Weekly insights on founder leadership, strategy, and scaling up without falling for consensus myths.

Your move. Pick one belief you have defended for the last three years. Bring your executive team together this week and ask: what evidence would prove this belief is wrong?