Why triple digit revenue growth is wrong

I went to a sales leadership event in London a couple of months ago where UK sales leaders were awarded prizes for their performance. The central theme was how fast they’ve grown revenue for their companies, many of them 100% or more year on year. They were eulogised for their “super sonic and triple digit growth”.

I appreciate that sales leaders’ job is to increase revenue, but I believe this obsession over obscene growth — at all cost — is unhealthy and unsustainable for the companies, their employees and society at large.

In 2019, Wework and UBER epitomised this problem. According to Crunchbase, Wework has received $21bn in funding since it was founded, and in only nine years they have established themselves in 86 cities across 32 countries, and become the biggest office tenant in New York. Similarly, Uber has raised a total of $24.7bn, and has become one of the biggest ride sharing platform globally, operating in more than 785 cities.

The praise they have received for their growth turned dramatically into rage as they went public last year. UBER reported $5.24bn in net losses in one quarter alone, and Wework’s founder and former CEO, was fired from the company after its failed IPO. Despite the failure, he will reportedly receive £1.7bn, as Wework’s investors seek to buy his shares and take more control of the company.

Whilst the executives are secured financially for a couple of lavish lifetimes, Wework laid off thousands of employees and UBER drivers continue to receive below minimum wage.

Although available capital is critical for entrepreneurs, the growth obsession lead to extreme risk taking, squeezed margins, low salaries (for most staff), fast hiring and fast firing, and a plethora of unprofitable companies (which thus drain more resources from society than they give back).

Thomas Piketty’s best-selling book, Capital in the 21st Century, argues that unregulated capitalism will lead to greater inequality; that more capital will accumulate in fewer hands. Wework and UBER are arguably two extreme examples of how this can play out in reality. I hope that their failures and the following chaos spark discussions at future sales leadership conferences on how technology startups can achieve sustainable growth, positive impact to society and “super sonic” equality growth.