From the course: Reid Hoffman and Chris Yeh on Blitzscaling

When to stop blitzscaling

From the course: Reid Hoffman and Chris Yeh on Blitzscaling

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When to stop blitzscaling

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- So Blitzscaling isn't a permanent strategy. No company can Blitzscale the same product forever. So you need to be on the lookout for the signs that maybe it's time to stop Blitzscaling. The first sign is when you run out of overhead in your market, looks like you've maybe saturated your market, there's not much of a reason to keep sprinting when you've already gotten to the destination. Great example here is Amazon and books. As an author, I can tell you Amazon is completely dominant in book selling. 70% of my books are purchased on Amazon. Does Amazon need to keep investing in order to take market share away to get that last five or 10%? Probably not. It makes sense for them to operate that business more efficiently, and then turn their attention to other businesses that they're Blitzscaling like Amazon Web Services. The second reason you'd stop Blitzscaling is the fact that Blitzscaling only makes sense when speed and momentum are important. Remember, you're sacrificing efficiency for the sake of speed. So if speed isn't important, why are you sacrificing? A great example here is Twitter. Twitter actually achieved its goals of becoming the social network that people use to share all this content, and after its user growth stopped, they kept hiring more people. Maybe it's because their revenues were still increasing, but ultimately, when you reach a point where you don't need to be fast anymore, it's time to just slow down.

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