Skip to main content

Posts

Showing posts from June, 2017

Designing for scalability – a startup perspective

What is scale? Is it the number of customers a company has? Is it the number of products that are sold? Is it the amount of revenue the company makes? Is it the amount of infrastructure one has? Or is it the number of features the product has? Well, it can be all of this or none of this. When an organization talks about scale it is not just a number. When an economist talks about it, again it’s not just a number. For an economist, the scale is about doing more with less. Scale is about perspective, about relationship between two or more variables that ultimately help you generate optimum value for your efforts.
Consider this, let’s say you are into making a lollipop. Selling 10 lollipops you earn $100 revenue of which $10 is you profit and $90 is the cost. When you increase you production you start selling 100 lollypops and earn $1000 revenue with $100 as your profit and $900 as cost. Did you really benefit from the scale here? In absolute terms, of course. In terms of ratios though,…