Let's start at the very beginning. What is a scale up? First point I want to make about a scale up is that it's a mindset, it's not a specific thing. There is no point at which you go directly from a startup to a scale up. What you need to change is the mentality. To move from a situation of putting out fires to lighting fires. What you need to move is from a mindset, from hunting, whereby every day is active heroism to farming where you can deliver consistent results with consistent effort. The other thing to do is answered in two ways to understand what it is and what it's not. In other words, I've said what it is and now I'll say what it's not. The actual definition you're looking for is 20 percent average annual growth over three years or more than 10 percent. You can see this definition now on the screen. It's a definition that comes from the UK government, if you need it that's what the definition is. But more useful is to think about what a scale up is not, more useful is to think that if your startup is a startup and that it can stay a startup, and that's quite okay. Steve Blank has provided six definitions of a startup, only one of which is actually a scale up. The first of these is a lifestyle startup. The idea of working to live. Think of something like a surf shop. Think of something, the idea that your passion is to serve and you may have a business at the side which enables you to do that. The next thing is to think of a small business startup, this is work to feed the family. This is the corner shop. Typically an immigrant comes over and they have come from a difficult situation and they just want to have something that feeds the family. That's also a startup, but it's not a scalable startup. Next, you have a buyable startup, like an acquisition target. This is the one, I mean at the moment with hot hotels. We have identified an area that is not being served by the bigger companies, and what we are doing is developing a startup which serves the market, and we hope one day will be acquired. Number 4 is a social startup where you're driven to make a difference. The example I like to give here is Charity Water. In other words, it needs to be profitable in order to pay the bills, but the central reason behind the company is not to make money. The central reason behind the company is to do something that makes a difference. Number 5, the large companies startups. This is innovate or evaporate. This is the idea that you're inside a company and you're doing something. The example is given of Google who asked her employees to dedicate 20 percent of their time on something that would be interesting for the company. Out of this came Gmail. It is a startup, but it's within a larger startup, so it doesn't have the same risk profile. Finally, scalable startups. These are the Facebooks of the world, or the Dropbox, or the Netflix, which you don't have to think of it as an either or a situation. If you can create a company that's a 20th, or a 50th, or 100, or 200 size of Facebook, you'll have created a scalable startup. Each of these companies have different financial goals, require different teams, and use different modes of financing. You have to look at all of these with regard to your particular situation. You may need to hire different people, you may need to take early VC, you may need to not take VC edges funded from exists, from selling things. You may need to look at all of these things. Not every company needs to become a scale up. I have a bias towards companies that are scale ups because that's my particular interest. But not every company needs to become a scale up, and that's okay. If you have a startup that's generating money, if you have a startup that's fueling your passion, if you have a startup that's serving a particular need in society, that's okay. But if you want to scale up, if you want to be a billion dollar company and have a billion users, then listen on.
