The current era is one with rapid growth, expansion and visibility for businesses. This can be attributed to the digital wave that has taken over the world. Businesses are now able to touch base with a larger audience and investors, both of which allow them to grow at a faster pace. However, some businesses cross the standard mark and grow at a much faster pace than others. This phenomenon was first coined as ‘hypergrowth’ by Alexander V. Izosimov in 2008 for an article in Harvard Business Review.
What is Hypergrowth?
Also known as ‘blitzscaling’, hypergrowth can be explained as a phase of rapid expansion for a business. A normal business grows at a CAGR of below 20%, however, a business that falls under hypergrowth climbs the growth ladder at a CAGR of 40% or higher.
|Normal Growth Companies||CAGR is less than 20%|
|Rapid Growth Companies||CAGR is between 20% and 40%|
|Hyper Growth Companies||CAGR is more than 40%|
Market demand plays a very significant role for businesses aiming for hypergrowth, however, product innovation, execution and strategic focus also play a very important role in this dynamic and volatile digital era. Businesses need to constantly adapt and change according to the environment, demand and preferences. Following are a few hypergrowth strategies by fast-growing businesses-
1. Product Innovation
Relying heavily on product-led innovation, businesses remodel or modernize existing products and their user journey to attract new customers and retain the old ones. For instance, Moneyfront has enhanced its product delivery to its customers by designing an entire digital journey. From insights and recommendations to advisory, customers can avail of an extensive digital journey instead of incurring costs on human advisory services.
2. Customer Centricity
Customer lifetime value and acquisition cost play an important role in defining customer centricity. It comes when businesses pay close attention to customer feedback and grievances and design alternates for a better CX. Customer data and metrics are the best ways to avail of these insights.
3. Scalable Business Systems
Businesses that fall under the hypergrowth category often face the challenge of scaling their business after a while due to technology or regulatory challenges, however, scaling a business is vital and should be undertaken periodically.
For instance, Niyogin’s journey began as a Fintech that offered financial assistance to MSMEs. Scaling the business for Niyogin meant bringing Wealth Distribution Tech and Rural Tech under its wings too to complete the entire financial services ecosystem. As of today, Niyogin continues to grow by adding well-thought products and services to its stack.
The environment we live in is highly dynamic and for businesses, this means adaptability and agility. Businesses must have agile processes to absorb and adapt to the changes thereby meeting customer demands. Agility comes to simple and scalable terms of operations that impact all the functions of a business, be it customers, partnerships or finance.
For instance, Niyogin partnerships ensure it gives them an edge over market competitors. To improve stickiness and operational efficiency, Niyogin has partnered with renowned enterprises to digitize its lending process. From application and score checks to acceptance, the operational journey is effectively digitized.
The majority of hypergrowth businesses today are all about technology and its effective implementation. Businesses may not have innovation at all times but how they use their existing innovation in a diversified audience also plays a critical role. This means, expanding their business and penetrating underserved areas.
For instance, iServeU is a classic example of leveraging existing innovation and infrastructure to cater to an underserved audience, i.e., the rural population. MicroATMs, Aadhaar Enabled Payment Systems, Bharat Bill Payment Systems and much more are offered to individuals residing in rural areas through existing innovation and by impaneling Kirana stores.
‘Unicorns’ are businesses that have achieved hypergrowth through one or many different strategies that they have implemented into their business strategy. Round financing, buy-outs, innovations, angel investors, venture capitalists, etc play a vital role in the growth strategy and therefore, businesses must aim at distinctive strategies, may it be innovation, operational or marketing to bring the best onboard!