Scale, Optimize or Innovate?

Good day to every unicorn in the galaxy.

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The question is always: how is your time best spent?

You generally have three useful ways to allocate your time:

1. Replicate what you have (scale)

2. Improve what you have (optimize)

3. Create something new (innovate)

For example: doubling revenue at $1M is very different from $100M. In the former you may be able to optimize what you’re already doing, or expand it to new cities or verticals.

In the latter, you may need something fundamentally different or new to open up another $100M opportunity.

Said differently:

If you’re responsible for adding $1M in revenue but you’re busy optimizing something that will likely max out at $200K, you’re going to miss your goal.

Why We Optimize When We Should Innovate

The optimization trap is seductive because incremental changes are easier to imagine.

And they provide a sense of intermittent progress.

But every action has an opportunity cost.

You could spend a year optimizing a landing page that caps out at 5%.

While an undiscovered marketing angle could yield 10-20%.

It’s impossible to know.

[Get Profitable] or Die

What is the one thing your startup must do to not die?

Usually it translates to some form of “not running out of money”.

That can look very different depending on whether you’re bootstrapped or VC funded, early stage vs late stage, etc.

But the range of outcomes is largely shaped by what you’re working on.

If you’re working on something without a realistic chance of achieving your desired outcome, it’s time to reassess.

This is true in business and in life.

People stay in jobs | relationships they hate while maintaining unrealistic goals.

This contradiction will eat you alive and kill your startup.

How to Scale, Optimize & Innovate Simultaneously

As your startup grows, you’ll want to scale what works, improve it and create new stuff simultaneously.

This requires different people:

• Some people are great at following detailed instructions

• Some people are great at being creative within constraints

• Some people are great at coming up with new ideas (many of them bad)

If you’re lucky you’ll have all 3 types working in parallel.

I think all businesses and areas within a business fluctuate along an innovation and optimization axis over time.

If you’re still looking for product-market fit you need to be innovating.

If you are taking a proven product to market, you are optimizing your messaging and distribution across the targeted audience.

Take Action:

Answer these questions to align your time with your goals.

1. What is the one thing I must achieve by [date]?

2. What are the different ways I currently spend my time?

3. What is the probability of each activity of helping me achieve my goal?

4. What activities am I not doing that would also help me achieve my goal?

5. What is their respective probability of a) working and b) achieving my goal

6. Which activity should I prioritize to achieve my goal?

I hope you’re enjoying the end of summer/winter.

-Brian

PS - if you’ve taken calculus you’re probably familiar with local vs global maxima. This concept is similar, applied to how you spend your time.