Management expects a "big-bang" launch.
Marketing expects a slow takeoff.
How fast should the sales grow in the first five years of the life of a startup? That's a challenging question for any startup. It is more complex to respond to if your investors got their experience in large corporations.
Startups that are winners do grow very fast. Mainly because they start from zero. So the percent per year growth rates are huge. But they start with very small numbers and thus are far from huge in absolute size even after several years.
It takes about ten years to brand a product. Until then, your product is vulnerable to competition and can lose its leadership position and eventually became forgotten in the mind of the customer. Meanwhile you have to fight to get into the position as leader, hopefully emerge around year five with enough sales to go IPO, and then move on with the hoard of fresh capital to become branded as the gorilla of the new market category.
How fast do startups grow?
Here it the record for Red Bull:
How fast did Microsoft sales grow?
It took Microsoft 10 years to exceel $100 million in annual sales.
Wal Mart took 14 years to break $100 million in annual sales.
So think about your expectations for sales during your first five years as a new enterprise. And be wise. It takes a long time to get very large.
BOTTOM LINE: Set your expectations for startup sales to be in the game for a long time. Adjust your capital needs accordingly. It is okay to aim to be huge very fast, but history says you will be shown to be very overly optimistic. Serial entrepreneurs understand that. When you do, you'll add it to the elements you use to build an unfair competitive advantage.
I wish you The Best on your Adventure!
"Marketing is too complicated to be left to management people who have little experience in marketing and who don't understand its principles." wrote Al Ries.
Rated by Advertising Age as one of the Top Ten living legends of marketing, Ries's findings and related implications in the book "War in the Boardroom" are spot on with the marketing challenges that confront first-time entrepreneurs.
This series on startup marketing follows the principles laid down in that book. I highly recommend the book to startup leaders.