In this season of Halloween, I’ve pulled together a few short lessons from skeletons that have jumped out at me over the years to disrupt the growth journey in companies that I’ve been involved with together with reflections on what I would do differently next time around.
This one really hurt…
It was all going so well… we had a big-name customer who loved our people and loved our technology. We fully expected that they would buy the whole company one day. We based the whole business around them, allowing them to define (and in some cases actually purchase) the equipment that we had in our lab and the research that got done. Understandably, they got nervous when we started talking with their competitors, so we didn’t. They were paying us generously and we had a good relationship with long-term plans, so it didn’t feel sensible to rock the boat.
Then something happened… international events forced a rethink of their strategies and budgets which resulted in our project being stopped. Not scaled-back or delayed, stopped. Our revenue went to zero overnight with nothing in the pipeline.
The business was forced to down-size immediately to a core team that spent a year frantically trying to find new markets for the company’s technology. A team of over 50 people was reduced to less than 20. Ultimately, there was not enough time to get new products into new markets and the board reluctantly decided to close the business.
With hindsight, I wouldn’t change our approach to the big-name customer. We got paid fairly for the work done, did some very interesting science, and built some long-lasting relationships which will benefit other sectors and companies going forward.
What we failed to do was develop any serious contingency plan or seek to commercialise our know-how in sectors that wouldn’t have been considered competitive by our main customer. Yes, we did have some other small projects in the wings but they were mostly high-risk ambitious projects aiming to sell new technologies into new markets. We probably should have had one or two lower risk (and quite boring) revenue streams that could have provided a longer runway when the big project was cancelled.
I also think we should have talked more to the competitors, partners, and suppliers to our main customer. Not to try and get more immediate business (which would have jeopardised our relationship with our core customer), but to get a better understanding of the market dynamics and a wider range of inputs into our understanding of the overall ecosystem.
In the next instalments of this blog, I’ll consider the balance between engineering and science in a technology business.
Telegraph Materials offers advisory services and practical support to fast-growth businesses bringing new materials-science based technologies and processes to international B2B markets. For more information, see www.telegraphmaterials.com, where you can also find the previous editions of this blog series.