If you’ve done initiatives in business, you’re very familiar with this graph:

Often referred to as a “hockey stick growth chart”, it indicates how revenue will shift from investment mode (on the left) to wonderful growth (on the right). The problem is that this is always used to project the future, not the past. What actually happens is far messier and doesn’t follow a nice pretty growth curve.

This came to mind when I heard recent reports about why WeWork went bankrupt. Since I’ve fallen into this projected-growth trap myself, I thought it might be good to explore how we might do something different.

The problem is that inflection point right in the middle. Sometimes we call it “and then a miracle happens.” Or that’s at least that’s what we wish.

Because at that point, we’re getting close to some big barriers. Money is running out. Investors are getting cold feet. The market window is starting to close.

So you make up reasons why growth will take off.

  • Customers notice that we finally got a critical mass of functionality in the product.
  • Our marketing efforts are now taking hold.
  • We’re now tapping the MASS market, not just early adopters.

It’s very rare that you actually know when these will happen. You’re just hoping that it happens before you run out of time and money.

All of this can be good for motivating your team in the short term. But in the long term, it often backfires on you. This is a major reason why I’m not a fan of using investors’ money, because it’s most likely that the delay in revenue growth will leave you with angry investors and even a bankrupt business.

So what’s the alternative?

In my mind, it’s slow and steady. If you have a few percent growth every quarter (depending on your industry), you’ll leverage the magic of compounding and build profitability. And if it’s slow, you’re more likely to have the growth be self-sustaining as long as it can be steady.

What about industries which (seem to) demand explosive growth? Well, if you like making those kind of bets, go for it. Just go into it with the understanding that it’s far more likely to explode in your face. Make sure that the risk doesn’t destroy your family.

I’ve learned to enjoy the slow and steady route a lot more.