Diagnose Growth
Where does growth actually come from?
Question 01 of 08. Understand: is the base solid? 0 to 2 years.
Almost every company can tell you how fast it grew. Far fewer can say what produced the growth, and almost none what it cost to produce. We decompose revenue into volume, price, mix, new customers and lost customers, then test each for durability, cost of acquisition, cash conversion, margin held, and performance against the market.
That last one is the question nobody asks themselves. Growing fifteen percent in a market growing twenty-two is not growth. It is a slower decline.
Same question, two businesses
Funded scale-up
Series A or B, equity, a clock
Does it survive the subsidy?
Does the growth survive removal of the subsidy? Discounting, free trials, inflated acquisition spend and extended terms all buy revenue. None prove a business.
Promoter-led business
Debt, retained earnings and cash flow
Bought with credit?
The subsidy is usually credit, not discount. Receivable days rising faster than revenue is growth bought with the balance sheet: the most commonly missed finding in this sequence.
The work behind this question
- Market ResearchThe market as it is, not as the deck needs it to be: sizing, segmentation and demand evidence.
- Competitor Analysis and BenchmarkingWho you are actually competing with, on what, and where the business stands against them.
- Market IntelligenceA continuous read on the sector: what is moving capital, regulation and demand, and what it means for this business.
Facing this question now?
Most companies need two or three of the eight, in the right order. Tell us where you are and we will tell you which ones bind.