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Blitzscaling is a business model that became popular among companies looking to increase profits with a bold and innovative strategy—especially after the publication of the book “Blitzscaling” by LinkedIn co-founder Reid Hoffman.

Names such as Amazon and Facebook were responsible for putting this model into practice, and it now also attracts the attention of startups and fast-growing organizations.

That’s because its benefits include the possibility of faster returns, as well as consolidating the company as a leader in its segment.

However, before adopting action models like this, it’s important to understand them in detail to ensure they can actually bring advantages to your business.

So, if Blitzscaling is a type of management that may interest your company, it’s worth learning more about how this approach works.

Keep reading to understand:

• What is Blitzscaling?
• Blitzscaling in practice: the Amazon case;
• The 3 main techniques of the Blitzscaling model;
• The company growth journey according to Blitzscaling;
• What do you need to start using blitzscaling?
• The role of technology in accelerated growth

What is Blitzscaling?

Blitzscaling is a business model that aims at accelerated company growth through bolder and less conservative practices. The main goal is to solve the company’s immediate problems at the moment this action is needed.

With that, the business optimizes its operations and resources, investing in the right areas to achieve greater return.

The term mixes two words: “blitz”, in German, which means lightning, and “scaling”, in English. In Portuguese, Blitzscaling is often associated with the idea of “lightning scaling”.

In addition, it can provide fast growth to the business if specific techniques are applied to help results show up in less time.

Blitzscaling in practice: the Amazon case

The Blitzscaling model is used by many companies, but one of the best-known success stories is Amazon.

This American multinational technology company is currently a leader in its segment, with a market value in the billions of dollars, and its growth happened at a considerably high speed—making it a strong example of this approach.

In 1996, Amazon Books had only 151 employees generating revenue of US$5.1 million. In 1999, after going public, it had expanded its operation to 7,600 employees and accumulated US$1.6 billion in revenue.

This means the company built a team 50 times larger and increased production 322 times in just 3 years.

It’s important to point out that, even with billions in revenue, the company operated for five years without generating profit. Only in 2001 did it achieve its first net profit, totaling US$5 million, as reported by UOL.

This shows one of Blitzscaling’s pillars: the company achieves relevant growth through riskier choices made by leadership.

Amazon managed to remain efficient thanks to operational cash flow, with multi-billion investments and accumulated debt to strengthen the brand and its activities.

And it worked: in the first quarter of 2022, for example, Amazon had revenue of US$116.4 billion, being one of the “big five” technology companies alongside Google, Apple, Microsoft, and Facebook.

>> Read also: what is disruptive innovation and why you should invest in it

The 3 main techniques of the Blitzscaling model

To put Blitzscaling into practice, you can follow three main techniques that define this management approach and make the strategy easier to implement.

See more details below:

1. The business model needs to be innovative

The first technique to prioritize this exponential growth approach is having an innovative business model. This means offering products and services differently from competitors, with real chances of expansion and sales.

“If your playbook is the same as your competitor’s, you’re in trouble, because they will likely run your strategy with far more resources!” — Reid Hoffman

It’s common for many early entrepreneurs to focus on elements such as technology and design, while leaving aside the foundation of their business: the monetization model.

Although software and other elements are fundamental, without an innovative business model the company won’t be able to grow. In this case, innovation is what allows new corporations to surpass competitors and generate advantage.

2. The strategy must embrace risks

The second stage of Blitzscaling requires strategies that embrace market risks.

One of the main pillars of this model is bold and innovative choices made by the company in order to maximize impact.

“The biggest risk for a successful, growing business is moving too slowly and letting competitors seize market leadership and first-mover advantage.” — Reid Hoffman

This is because it involves making decisions that go against conventional business thinking and often prioritizes speed over efficiency.

Or it can even risk safety, like Amazon did by making massive investments to achieve results and consolidate even more in its segment.

That’s why it’s important that the strategy doesn’t stay only in a comfortable and stable scenario, but also includes calculated risk-taking.

3. Management must keep up with the scaling

Finally, the third technique in the Blitzscaling structure is building a management approach that keeps up with the scaling of activities.

This includes management practices needed to meet the demands of growth and company size.

“Tripling the number of employees every year is standard for a company applying blitzscaling. This posture demands a radically different management approach than a company that develops at a regular pace.” — Reid Hoffman

Companies that apply this model in their day-to-day go through radical transitions that can be risky. For that reason, it’s important to build management that can follow these movements appropriately.

For example, even if the strategy aims to grow activities, it won’t be possible without expanding the team—so this must be part of management priorities.

Defining these points is essential before adopting Blitzscaling, especially for those who want positive results.

The company growth journey according to Blitzscaling

In practice, for a company to grow according to Blitzscaling, it needs to go through the five stages of the journey, described as:

1. Family;
2. Tribe;
3. Village;
4. City;
5. Nation.

Learn the details of each stage and what they represent:

1. Family

The Family stage is the initial moment of the company, when it has a small number of employees—between 1 and 9 people. This phase focuses on product development, understanding market needs and how to make the proposal innovative.

That way, it becomes possible to understand the company’s competitive advantage and build a sustainable model, even if aggressive.

Since the business is still small, it’s also an opportunity to define each employee’s role in the journey and how their functions impact the operational routine.

2. Tribe

After the team becomes more familiar and the workflow starts to become more formal, leadership can expand the company.

However, this stage is characterized by fast growth and quick decisions to fund the product before competitors have a chance to act.

It will also be necessary to organize departments more formally, with a well-defined offering and the first investments underway.

In this phase, it is possible to have more than 10 employees, as long as they are aligned with production, optimizing the operational side to truly boost results.

3. Village

In the Village stage, the company already has more than 100 employees. This phase is marked by the real implementation of the company culture, with more structured procedures.

It is also necessary to start scaling activities based on the market and forecasts, simplifying processes as much as possible.

It’s important to check whether the team can keep up with these changes. If not, it may be necessary to structure the team more professionally so employees become specialists in their areas.

4. City

In the City stage, the company has more than a thousand employees, enabling more defined tools and production lines, with indicators to track real growth.

At this stage, it’s possible to consider investments in research and development of new differentiators.

It’s also important to consider automating certain processes, since it is assumed the company already has more than one product, which can add bureaucracy to the workflow.

The goal is to keep growing simply, and automation technologies can help ensure efficiency.

5. Nation

Finally, in the last stage of Blitzscaling, the Nation has more than 10,000 employees.

One of the main challenges is keeping communication aligned and investing in a global strategy, since there may be employees and departments in different parts of the world.

In addition, it is time to focus on a continuity strategy, consolidate the company culture, and train senior managers to replicate the journey with new members.

In this scenario, the company must size itself and design actions that meet its demands in the simplest possible way without compromising performance.

Technology remains one of the most attractive alternatives for this phase, freeing teams from repetitive tasks and focusing resources on complex operations. This adds value to the company while maintaining fast growth at scale.

>> Learn also: how to turn your company into an exponential organization

What do you need to start using Blitzscaling?

After learning about Blitzscaling, many managers and early entrepreneurs may become interested in this practice—especially because it is a model reproduced by big businesses.

In this case, there are some tips that can help the adaptation. They are not rules, but suggestions, because each company is unique and has its own scaling challenges.

Still, considering these points can make it easier to implement the model successfully.

See the details:

Discard traditional market rules

First of all, it’s important to keep in mind that Blitzscaling is an innovative and bold model that discards conventional market rules.

That’s why entrepreneurs with more traditional thinking may have difficulty adopting this growth strategy.

In this case, it is essential to abandon actions or practices considered “standard”, because they prevent this format from being executed and contribute to the fear of taking risks.

Have investors willing to fund your project

The cost of Blitzscaling—even when it succeeds—can be considered high depending on the size of the business. Therefore, it’s important to have investors willing to fund this practice.

If the journey is achieved properly, returns will be faster, but necessary expenses will grow at the same speed.

So having people who will support the model and believe in the business’s success is extremely important.

Make sure market conditions are appropriate

Finally, although it may look attractive, Blitzscaling is not always the best approach for the current market context.

Assessing the scenario and being sure the conditions are appropriate is essential to make this strategy work.

It’s worth checking whether any other company tried this move, or whether the niche is weak.

Knowing these indicators will help implement the model with greater chances of success.

The role of technology in accelerated growth

Although focusing on technology is not a mandatory characteristic of Blitzscaling—which makes replication possible even by low-tech companies—it’s undeniable that technology is important to reach an innovative business model.

After all, software and automation programs provide the convenience needed to expand activities with the simplicity this model requires.

On the other hand, the digital era also contributed to the expansion of a global market that focuses on consumer needs in this segment, with products and services on the web.

In this case, building a company that grows at high speed through Blitzscaling requires participating in this new environment.

So don’t forget the role of technology when pursuing accelerated market growth, and increase your chances of obtaining positive returns in a concrete way.

Make your digital business the next success story! We at X-Apps want to help your company grow. Talk to one of our specialists and learn about the solutions X-Apps can implement to make your day-to-day easier.

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