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Cheesecakes
If you’ve ever eaten at The Cheesecake Factory, you’ve felt the Paradox of Choice. What started as a small Beverly Hills café now serves over 250 menu items across 20 pages. Yet, somehow, with all of those options staring you in the face, you struggle to choose one when the server arrives.
Founders face a similar problem when trying to grow their business.
Should you launch a new product? Try paid ads? Hire another operator? Expand into a new vertical?
Too many options create anxiety, not clarity. You freeze, hedge, or default to what’s familiar instead of what’s strategic.
Often, the problem isn’t necessarily too many choices but the inability to properly evaluate your options.
A huge first step is understanding the category or growth mode archetype you are pursuing. Why?
Each growth archetype draws on different resources, carries different risks, and delivers different types of rewards.
Identifying and understanding the correct growth archetype is important because it determines where you focus, how you measure success, and what risks you face with each option.
When you fully understand what growth archetype you’re pursuing, you can avoid shiny object syndrome, pick the right metrics, and make smarter, more aligned bets that compound over time.
Growth Mode Archetypes
Mode | What It Means | What It Looks Like |
|---|---|---|
Capacity Growth | Add more of what’s working | Hire more people, buy more equipment |
Channel Expansion | Reach new customers via new channels | Ads, referrals, SEO, partnerships |
Market Expansion | Sell to new customer segments | Move into a new vertical |
Product Expansion | Add new offers | New tier, feature, service |
Efficiency Growth | Improve systems or margin | Automation, delegation, tools |
Capacity Growth
“Let’s do more of what is already working.”
When To Invest
If you’re consistently hitting demand limits it might be time to invest in capacity growth. During my first startup we invested too early in capacity growth. We had a fully built out customer service function before we had one customer which turned out to be huge waste of resources.
It should feel somewhat painful (for a period of time) to keep up with demand before investing in additional capacity.
How to Measure
What to Watch For
Operational drag - Are there inefficiencies and hidden costs that arise when adding capacity?
Seasonality - are you factoring in seasonality to your increased demand?
Ramp up time - how long could it ultimately take to get the new capacity online?
Channel Expansion
“Let’s grow by finding new ways to reach customers.”
When To Invest
If you’re organic reach has stalled or if a channel you’ve been successfully selling into has maxed out, you should perform expansion tests into other channels.
Channel expansion is often one of the least risky forms of growth due to the ability to run small tests before doubling down on successful ones.
How to Measure
LTV=Life Time Value CAC = Customer Acquisition Costs
What to Watch For
Overspend - Be very clear on validation metrics before over investing
Traffic Quality - new ad campaigns can drive high traffic but low conversion
Consistency - are your initial tests repeatable or were they a one-time phenomenon?
Market Expansion
“Let’s serve a new kind of customer.”
When To Invest
Market expansions can include everything from targeting a new avatar to entering a new geography once you have exhausted your current one.
For example, I have considered opening my ImUp Alarm Clock App to countries other than the United States if and when the beta launch is successful. I would need to consider the costs of localizing the app, language translation as well as potentially different service models.
How to Measure
What to Watch For
Different customer behavior - Consider how new customers might require longer sales cycles or have different price sensitivities
Delivery Model - would a different delivery model be required and how might that affect your ROI?
Operational Mismatch - how could new systems or processes conflict with current ones?
Product Expansion
“Let’s offer more to the people we already serve.”
When To Invest
Identifying unmet needs from your current customers is a great way to grow. You understand the avatar and can run surveys and other validation exercises prior to committing significant resources.
How to Measure
What to Watch For
Cannibalization - Are you solving a new problem or have you simply provided a new solution to one you are already serving?
Complexity - do new products increase your business’ complexity and costs?
Support Overhead - do new products or services mean additional support?
Efficiency Growth
Let’s do the same (or more) with less.”
When To Invest
Business owners often view growth as simply doing more. Often the best next step is to improve the efficiency of your current growth engines.
Founders who want to improve margins or buy their time back should consider investing in efficiency growth.
How to Measure
What to Watch For
Mistaking Tools for Leverage - Are you implementing a new tool or something that will truly add leverage to your business (more time, profit, etc.)?
Soft Savings - benefits such as more time and fewer frustrations might be hard to quantify but are no less valuable.
Shiny Object Syndrome - efficiency growth projects are often boring. Don’t mistake novelty for true growth!
The Next Step
Understanding your Growth Mode isn’t just about focus but precision.
Each archetype comes with its own metrics, risks, and resource demands.
When you can identify the mode, you can correctly frame the bet, measure it correctly, and account for tradeoffs.
That is what separates scattered effort from strategic momentum.
My goal with The Leap is to provide you each Saturday with the knowledge, tools and lessons learned to help you get started and keep going toward building your future.
Whether you are making the leap to startups, solo-entrepreneurship, freelancing, side hustles or other creative ventures, the tools and strategies to succeed in each are similar.