SCALE paths: Evolution tracks

Hi,

Knowing your SCALE path is great, but it’s only half the equation. The other half is knowing your evolution track.

We found there are five evolution levels in a business. Knowing both your SCALE path and your evolution level allows you to triangulate the advice you take and the advice you give to others.

Here are the five levels we found through our research. If you are not even ready to think about that kind of thing, then you would be a Level 0.

• Level 1 - Founders at this level don’t even know how to start doing things because it’s so overwhelming. They are pulled in every direction and feel like they are drowning in information from every direction. In order to get out of this level, you need to start doing something and it doesn’t matter much what you do.
• Level 2 - Entrepreneurs at this level have started doing things, which is great, but nothing is working. They are following all the best practices as best they can, but they are failing at everything they try. If you want to get to the next level, you have to find something that works and latch onto it.
• Level 3 - Brands at this level have found something that works, but they are also doing all sorts of other things that aren’t working. To get out of this level, you need to shed everything that’s not working and double down on things that are working for your SCALE path.
• Level 4 - Entrepreneurs at this level have fully embraced their path and are making money, but they are capped out at what they can earn without evolving beyond what they’ve been doing. In order to exit this level, you need to integrate other start building a team and/or bringing new paths into your business.
• Level 5 - At this top level, entrepreneurs have built out a team and have all the paths working for them, and need to keep building out.
• If you know you are a level 3 Arbiter (we call that a A3), then so much suddenly becomes clear to you. For instance, you know that the thing you should be focused on right now is optimizations to get from level 3 to level 4. You also know you should be focusing on finding the next hottest trend before the arbitrage goes away.

You also know that you should be focused on learning from other Arbiters who can help you embrace the qualities that will help you thrive. Conversely, if you’re a level 4 Arbiter (A4), then you know that you should be focused on learning from other paths to help you expand.

One of the biggest things that hampers founders is that they try to expand too quickly into other SCALE paths. While you should be testing things to find what works at level 2, once you have found those things that work you should be shedding everything else in level 3 to double down on what’s working to push through into success. Once you have had success, then and only then should you start adding other paths back into your business.

Each stage has its own growth metrics.

• Are you at level 1? Then you need to settle and start somewhere, anywhere.
• Are you a level 2? Keep testing and experimenting with different paths to find something that works for you.
• Are you in level 3? It’s time to double down on what’s working and cut things that aren’t so you can focus your attention and find success.
• Are you evolving into level 4? Now it’s time to start integrating new things into your business to allow you to build.
• Are you at level 5? Awesome. Keep going and adding team members as necessary.

One thing to remember about these levels is that you can ascend or descend them. Founders often think that once they are a level 3, they can never descend back to level 2, but more often than not this descent is a major cause of burnout.

Strategies that have worked for years can suddenly start failing, which causes an entrepreneur to double down and double down again, losing ground with each iteration until they collapse in a heap from exhaustion.

This is why it’s so important to double down quickly once you find something that works, so you can create a stable income and then start incorporating other SCALE paths into your business before those strategies lose efficacy.

Most founders become stuck in level 3, getting distracted by shiny objects while their business stagnates and they fall back into level 2, only to continue that cycle again and again until they burn out. If instead we can double down on what’s working quickly without getting distracted, then we can push through level 3 and start building out systems in level 4 to make our businesses more resilient.

The vast majority of businesses we talk to are stuck between level 2 and level 3. They are either floundering to find something that works or using all their energy on actions that don’t work instead of focusing on those things that do.

Most founders will never get out of level 3 because they are bogged down with actions that have marginal efficacy to them. Instead, they are in a continuous cycle between level 2 and level 3. They are so tired that they can’t get enough momentum to achieve escape velocity into level 4.

But, let’s say you have reached level 4, how do you evolve beyond your own SCALE path? Focusing on one path for a while is great, and gives you something to fall back on in times of trouble, but a robust business needs multiple paths and streams of income working together so that when one fails they can pivot their business quickly.

We’ve charted evolution paths for each SCALE path, and while there are commonalities between them, each one is unique.

As we go through this, it’s important to remember that when we talk about “evolving into a new path”, we aren’t telling you to abandon your base path. Instead, you are incorporating aspects of the other paths into your business in ways that make sense to create a stronger business.

I’ve outlined possible evolution paths for each path, though you might see something different in your business that makes you take a different path.