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Like so many successful companies before it, Morning Brew’s story started in a dorm room.
In 2015, Alex Lieberman was a senior at the University of Michigan, and he already had a job at Morgan Stanley lined up for when he graduated. His schedule that year consisted of only a couple of classes, and he was bored. To pass the time, Lieberman started writing a business news roundup that was fun and engaging — nothing like the dry, stolid prose his fellow business students were used to choking down in the Wall Street Journal. What started as a handful of subscribers grew. In 2018, Morning Brew was earning $3 million in revenue; by 2019 it was earning $13 million. It’s set to earn $20 million in 2021.
The trajectory of Morning Brew — and plenty of other companies — followed a growth pattern that Lierbman termed the “Balloon Effect.” This, he says, is defined by “years of hard work and grit, complemented by slow linear growth,” followed by an explosion, in which a business “hits a tipping point and its trajectory shifts entirely.”
Most of us are familiar with two types of growth curves: Logarithmic, in which growth increases rapidly in the beginning, with gains decreasing over time. (Think learning a language or new instrument — when you’re just starting out, you double your knowledge immediately. For experts, growth is much more incremental.) Then there’s exponential growth, with gains slow to start but quickly gaining speed as time goes on. Entrepreneurs generally recognize both.
What Lieberman is proposing with the Balloon Effect is a curve that initially resembles exponential growth, and then, seemingly out of nowhere, goes straight up. You can’t force the Balloon Effect to happen to your business, but you can cultivate an environment where it’s more likely to take root. Here’s how.
As a bootstrapped founder, I have long preached the benefits of slow growth that doesn’t rely on outside funding. Chaucer said that time waits for no man, but the same can also be said of investors — there are exceptions, of course, but careful scaling up over time isn’t exactly music to VC ears.
My business, JotForm, has grown slowly by design. This has allowed me incredible freedom — my business is mine to run as I choose, no investor satisfaction required. It’s also allowed me to have a rich personal life outside of work, with time to spend with my family and even take a few months off each year. I credit these things with keeping my blood pressure in check, and the reason I’ve been able to grow JotForm at the pace I have in the last 15 years.
There’s value in the oft-glamorized hustle, but with that lifestyle comes the risk of burning out before you get off the ground. Hitting that tipping point — the place where the balloon bursts — is not inevitable. But if you are going to get there, growing slowly and thoughtfully is the way to do it.
Related: Overnight Success Takes Ten Years
March to the beat of your own drum
“I know it sounds crazy, but every time I have made a decision that is best for the planet, I have made money.”
That’s a quote from Yvon Chouinard, founder of the outdoor brand Patagonia and perhaps the most reluctant billionaire on Earth. He didn’t start his company to make himself rich — instead, Patagonia grew out of a climbing equipment startup that Chouinard used to fund his time on the mountain. Patagonia grew as it did because Chouinard’s objective — making sustainable products and advocating for the environment — was one that resonated with a lot of other people. As he tells it, becoming rich was just a byproduct of doing what he wanted to do.
Not everyone’s passion is going to blow into a powerhouse like Patagonia. But pursuing an idea that you genuinely believe in will keep you going during stretches that are tedious or just plain hard. As one former Patagonia employee told Forbes, Chouinard’s concern for the planet is 100% genuine: “It’s real. It’s not a story. It’s not a strategy. It’s a real human thing.” It’s no coincidence that he’s been able to keep at it.
Play the strategic long game
The last year-and-a-half has forced many businesses to reassess their strategies. But even though the context was dismal, the lesson on agility is a useful one. As Forbes contributor Amy Cappellanti-Wolf writes, a long game target has to include regular status checks, which can reveal the unexpected. When that happens, it’s time to pivot. “A pivot updates the long game,” she writes. “When (not if) the rules of the game change, a pivot occurs when you update your tactics and strategy.”
One key to pivoting is doing it with intention, not panic. Uncontrolled pivoting is more like flailing. A crisis like a global pandemic forces us to critically examine our decisions, but it also means not reacting impulsively. Again, there’s no guarantee you’ll reach the Balloon Effect’s tipping point, but making smart, strategic decisions will most definitely increase the likelihood that it happens.
Growth happens through a combination of increasing your competence and building your network, writes Abdo Riani, CEO of VisionX Partners. “Failed projects aren’t a real setback as long as they increase your competence and network (hence the importance of failing with grace), as those are the two leverages that would help you find an out-sized success in the long run,” he says.
Many “overnight success stories” are actually the Balloon Effect in action. The lesson here is that even though the explosion is the point at which people start paying attention, the slow and steady growth that precedes it — the part where the balloon is filling up — is an essential part of the journey. Slow growth can be frustrating. But by playing the long game and building carefully, you’re creating the ideal conditions for the scales to tip.