Creating for scale-ups

Some thoughts on the power of creativity for startup and scaling businesses

Feb 26, 2024

Over my three decades of experience developing brands and building marketing campaigns and strategies for a wide range of businesses, creativity is consistently undervalued. Over on LinkedIn I wrote a series of three articles looking at different dimensions of this issue, and how you can think about it – below is a summary of all three. I’ll put links to the original articles at the bottom of this piece.

This article is a bit more focused on my startup and marketing experience than the other posts so far – would love to hear what people think…

The business of creativity

Creativity is often wrongly marginalised as a nice-to-have in business — the fluffier "crayon" department. But study after study shows embracing creativity systematically drives sales and brand value, as well as future-proofs competitive advantage amidst rapid technological and social changes. It’s a combination of culture and the dictat of the spreadsheet – ‘serious’ business people struggle with justifying intangible value and an activity they don’t often understand, plus longer term brand building is usually not a priority, particularly against the Board Inquisitors1.

Once past the seed round, or even Series A, all B2B tech businesses I’ve worked with or speak to have the same challenge — they want to keep scaling and find a path to revenue, even if what got them 'here', won't get them 'there'!

This view stems from failure to connect creativity to metrics that executives care about daily – revenue, conversion rates, recruitment and retention. But the data doesn’t lie. Good creative execution, which connect both emotionally and rationally with customers, build mental and physical brand availability. They maximize ROI as advertisement costs increase yearly. For example, HubSpot’s creative content strategy fueled 7 years of exponential growth from $6 million to $271 million in revenue.

My framework for where to focus marketing priorities as a founder or leader in a scaling business

“Soft” creativity drives hard business results

Empathy in marketing, a central principal of effective creativity (if you can't put yourself in the shoes of the customer, you're unlikely to succeed), directly impacts conversion rates. Harvard Business Review's research suggests that the top 10 most empathetic companies saw their monetary value more than double compared to the bottom 10 and generated 50% more earnings.

The top 10 most empathetic companies see double the earnings growth. Shopify nearly doubled product revenue in one year by focusing on customer experience. Consumer giants like Coca-Cola and Red Bull show that real world emotional connections outweigh test metrics.

Shareholder value also heavily depends on creativity. 40% of large cap value comes from brand equity and intangibles. Yet creativity is the first cut when costs are scrutinized. Legacy views limit growth – highly creative companies see 30% higher enterprise value growth and 17% higher CAGR.

Add to this the fact that the large companies that startups and scale-ups aspire to become in the future have at least 40% of their value in intangible assets, particularly brand value (thanks to Jonathan Knowles for his many analyses here). This suggests that to be a successful growth story (not even a unicorn), investment in brand, creativity and emotional engagement with customers should be non-negotiable. It should be built into the growth strategy of the entire organisation.

Creativity fuels innovation

As AI rapidly improves at content creation, creative brand building that makes an emotional impact will become more crucial for standout marketing. Digital advertising declines in effectiveness, loses tracking from cookies, and faces more privacy regulation monthly. Creative, people-centric communication is essential to build customer trust in an increasingly cynical world.

Finally, a plea from an ex-creative agency CEO (i.e. me) — creativity is not a solitary endeavour but a team sport. Encouraging creative contributions across all departments not only creates better marketing outputs, aligns objectives and evolves effective tactics, it also fosters team building and culture, which all enhances overall business performance. Plus you get a more diverse set of ideas.2

“Culture eats strategy for breakfast” is the famous quote from legendary management consultant and writer Peter Drucker. Still not applied that effectively in business, probably because it's not a natural 'sweet spot' for many leaders, who prefer focusing on strategy or operations.

Creativity is a magnet for talent and revenue

Beyond marketing, creativity solves issues across key business functions:

Opportunity Fit – Data is useful for opportunity sizing, but empathy and inspiration better evaluate and activate new markets. Emotional connections sparked Coke’s growth despite bad test metrics. Unappetizing Red Bull surged through breakthrough branding.

Although lots of data can be collected via desk research and direct customer research, we need to take a creative approach (and by that I mean empathy and a brand vision that resonates and inspires) to really connect with the audience. Just data won't do it.

Recruitment – No amount of equity attracts talent like a purpose-driven vision. Culture fuels performance, yet is chronically under-invested by founders and investors obsessed with strategy. One of the biggest challenges of any scaling business is finding the right people, and bringing them on the journey where they will make your mission their mission.

No amount of share options will do a better job than creating a powerful, shared vision for the company, a ‘worthy goal’ that will tackle a challenge that's personally valuable, and a narrative of stories internally and externally across the organisation.

Focus - More options emerge as companies scale, presenting distraction and spreading resources thin. But the most successful brands use an inspired vision and core values to filter opportunities. It's natural as a company scales, more possibilities will emerge for the business that will affect the thinking, operation and strategy of the company – new clients will ask for specific features, new partners will push for closer alignment with their products, and new revenue streams will emerge.

These all present the risk of distracting the company from not only their original vision and values, but also spread resources thinly. Suddenly the one thing that was excellent now becomes part of a list of features, none of which stand out in the same way.

Founder Scaling - Many founders limit growth by retaining control of their early, ad hoc processes. Creativity helps formally tap talents across the company to take founders' vision to the next level through trust and empowerment. For example, many companies start up with a founder being the primary salesperson, often because they have the best connections and the most persuasive pitch.

But to really grow to a decent size, sales, brand & marketing needs to take on a lot of this job, to 'systematise' the process and start to use a mixture of data as well as personal insights. Some founders, even if they recognise this, insist on everyone doing it 'their way', even if it's not suitable for a different sales model that doesn't rely on a heavyweight sales influencer at the centre.

Avoiding the Traps

Yet there are risks to navigate. Creativity for its own sake leads to "shiny object syndrome", diverting resources to cool-sounding ideas not tied to strategic goals. Fear of failure blocks the constant experimentation essential for growth. Unconscious biases can misdirect creative efforts if not proactively recognized and mitigated.

I think we can all get distracted by great designs, ‘cool’ ideas and compelling stories. In the right hands, and for the right purpose, these are powerful tools for success and growth; but wrongly applied they can seduce the best of us into thinking we're doing the right thing, even if we are not.

The key is prioritising creativity tightly coupled with vision and values, not just aesthetics. With the proper foundation, creative innovations outperform by understanding customer motivations and seizing the future faster than competitors.

I understand why creativity takes a back seat. Results feel more concrete from financial management, operations and engineering. But hope and vision light the long hard road of building something from nothing. To channel energy into new solutions, creativity cannot be left waiting at the door. Leaders must invite creativity to the strategy discussion, connect creativity to growth metrics, and continually invest - not despite uncertainty, but because of it.

Final notes

In summary, creativity is still under exploited for most businesses, who struggle to foster a diverse, open, creative culture to get the best ideas. This is hard when an open season on creativity and experimentation could easily end up unfocussed and unproductive. For me the key is to trust your people (you hired them for a reason), make sure failure is clearly part of learning, and inspire people with a clear vision of what success looks like – how the world will be a better place with your company in it.

‘Inspiration’ and ‘perspiration’ are not contradictory, they both feed off each other.