What Religious Growth Can Teach Startups About Scaling
Some say startups are like new religions, and I wouldn’t disagree.
Now this metaphor is a precarious proposition for the fact that there are so many ways one can interpret it. Here’s one way to look at it: Most mid-sized new ventures are obsessive about their own company culture, baptize new employees into this culture through inductions/bootcamps, and their company rituals and norms reinforce their dedication towards this religion.
On the other hand, religions are, in some ways, like (social) ventures themselves. They start to bring a change into the world. Some grow across countries, some don’t. Some lasted the test of time and a massively changing external environment, while others failed and died out eventually.
There have been hundreds of religious groups and movements throughout history, but only few survived over time and continue growing even now. Religion grows as a result of a religious movement; studying how these religious movements spread can give ideas on how startups and social ventures can be expanded similarly.
I looked at a bunch of religious movements and tried to identify some common themes. Here’s some of what I found, and how it is relevant for social ventures and startups that are looking to scale.
An extraordinary founder
Lesson for startups: The importance of an effective founding team
Buddhist literature calls the Buddha “so extraordinary, unerringly kind and wise” and any encounter with him was so positive that it would change people’s lives. The Bible mentions the qualities of Jesus that Christians should desire to make a part of their own personality. All religious leaders reflected strong commitment to the cause, influential leadership and inspiring personalities.
The success of startups also depends on who the people behind it are. Within all start-ups is an effective founder/founding team that must have a sound understanding of the business principles, and must be able to spread their skills and ideas to those involved in the growth of the organization. Some VCs like Paul Graham, consider that the startup idea is secondary to the team itself — if the team has the commitment and skills to lead and coordinate the enterprise, it has a higher chance of succeeding.
Social and cultural opportunities
Lesson for startups: Look for the need to change, exploit external situations to grow your market
One of the ways institutional/societal change begins is:
- an external shock takes place
- the public’s attention is called to the matter
- institutional entrepreneurs lead efforts in these situations
- and infuse new beliefs, norms and values into society.
The Arya Samaj movement grew when Hinduism was declining due to the influence of Western culture in India. Swami Dayanand Saraswati wanted to reform Hinduism by eliminating some of its futile practices and reviving Vedic institutions. Brahmo Samaj also began in similar conditions with the same objective — to prevent Hindus from converting to other religions by adapting the religion to the needs of the times. Brahmo Samaj formed at a time when India was under British rule and hence had many western influences that aided in formation of the ideology of the movement. Clearly, the external cultural conditions at the time were a critical factor in the origin and growth of both these reform movements.
Similarly, the external situations of the environment where a venture originates are important in its formation and initial growth. Social entrepreneurs come up with solutions to social problems, and deftly exploit cultural conditions in order to put these solutions into effect.
Oxfam International, one of the world’s biggest development organizations, majorly grew as a result of reacting to external conditions in the developing world. Oxfam began as a committee for famine relief during the Second World War. Oxfam continued operating when similar relief organizations shut down and extended its outreach to other parts to “relieve suffering arising as a result of wars or other causes in any part of the world”. They started responding to famine and disaster emergencies in India, Greece and Africa in the 1950s. Social deprivation or depression leads to a need for change — which Oxfam provided in the form of its relief operations. Oxfam also gained more popularity in the 1960s when the Beatles were involved in their hunger campaign right when thousands of people were a part of the increasing Beatlemania, leading to more public involvement in their cause.
However, external conditions play a major role in only the emergence and coalescence of movements, not as much in their long-term spread. A more long-term approach is needed to consistently expand a new venture.
To exploit existing markets and explore new ones at the right time is a strategy that can work wonders for businesses . Amazon is a great example of how companies can exploit market opportunities to their benefit. When Amazon first launched in 1995, they called themselves “the world’s biggest bookstore”, quickly taking on the internet market for books and continually exploring other markets to enter into while no other company was doing so. Amazon survived the dotcom bubble crash because it was well established in the market while other players were only starting off and focusing on short-term returns. The timely market entry and growth of Internet after the late 90s was what facilitated Amazon in becoming the e-commerce giant that it is now. Another of Amazon’s market opportunities came when the company faced a storage struggle and created a cloud computing service for internal usage. However, they found that the service could be adopted by other businesses too and so, on seeing that there was a market for it outside of Amazon, they launched Amazon Web Services (which now a fast growing $5 billion business!).
Change oriented, adaptable ideology
Lesson for startups: Make your product/service useful, replicable and flexible
Religions have a unique set of core principles, morals or a code of conduct that guide the follower’s experience in the religion. Followers have been adhering to these principles ever since the religion was established — despite the drastic changes in external factors such as culture and technology.
While the core principles of religion remain the same, various other aspects can be interpreted in different ways to suit the external conditions at the time. Jainism failed to spread over a large area like other religions partly because Jain principles were rigid and not many people were willing to adopt the strict, sacrificial way of life as preached by the monks.
This holds a lesson for ventures that want to scale up: the product, service or model must be adaptable and replicable in different contexts. The Knowledge Is Power Program (KIPP) successfully scaled up with a flexible idea. KIPP is creating a network of schools that share a central set of general operating principles that they call the Five Pillars. These pillars are principles that are quantified by specific metrics (for example, one pillar is High Expectations), but the principles themselves are broad enough to allow for flexibility in how they are applied. Different elements of scalable innovations can be defined broadly or explicitly — the goal is to find a level of detail that is effectively transferable across different regions.
Initial recruitment and influential propagators’ activities
Lesson for startups: Start small, look for trendsetters, exploit networks and resources for growth
Whatever motivation for joining a religion was verbalized by its founders, it couldn’t occur without any contact with a catalytic agent — other people.
Buddha and Mahavira “recruited” followers by traveling to various towns and preaching their ideology themselves. Mohammed initially only preached his learnings in Mecca where he got his initial followers. Paul the Apostle undertook missionary journeys to several parts of the world in order to spread his teachings about Christianity. Religions that proselytize and their missionaries spread the word by believing they are doing “God’s work”. They use their networks, are persuasive and persistent in helping to spread the message. Many religions took to the masses when influential people such as kings adopted them.
Buddhism owes a major part of its global spread to Emperor Asoka the Great, who implemented Buddhist principles in his administrative practices. Being a successful and widely popular ruler, the masses adopted Buddhism under him. Pentecostal groups also grew only when they attempted to recruit via people who already had the networking potential to attract others in their circle of contacts. In marketing terms, celebrity endorsement and multi-level marketing helped religions go from the set of initial followers to the commoners.
Creating and using networks effectively is essential for scaling a venture. Due to the ease and influence of social media now, it is not necessary for founders to go “door to door” to attract initial customers (however, that’s literally what Airbnb did in New York to recruit new users and help existing ones, and they’re valued at over $20 billion now!), but creating strong connections with customers and possible enthusiasts always helps. Many startup founders make a common mistake of launching big right at the start, while they could be doing smaller scale activities to refine their concept in the initial stages to avoid problems in scaling later.
Celebrity endorsement, when done right, adds credibility and instant brand recognition to a startup. However, this is a grey area for social startups and non-profits: they have a greater responsibility towards society and it is important for them to create a reliable image. Their actions should thus focus on letting people know about the true impact of their work, not attracting them via glitz, which is why choosing the right person to represent the organization’s brand image is essential. Influencers must believe in the cause themselves, and be admired by the target audience for maximum impact. When the right contacts are made, the impact of an organization can grow exponentially.
Decentralized, multi-headed organization system of the movement
Lesson for startups: Delegate tasks; create partnerships in different areas to scale up
The organizational form of most religious movements is different from that of the religion itself. The founder does not head a religious movement, he only begins it, while the movement itself is relatively decentralized, and different people are responsible for the spread of religion in different places.
The Pentecostal Church movement was essentially decentralized. Hinduism is another religion that has survived today due to its different sects: though each sect is slightly different, the core principles are the same and the failure of one sect does not cause failure or suppression of the entire religion. There have been various Islamic movements across Muslim nations that were structured similarly, shared the same ideology but were headed by different people in different areas.
Creating institutions and partnerships is important for startups that want to scale, because a model may not be exactly replicable and need to be adapted for different demographics, and the team might not always have the necessary competence and resources to make necessary changes. Building relationships and partnerships with other organizations can be an effective way to help deliver the product, service or model in more areas. Oxfam International is a confederation of 17 organizations that has created development programs to fight poverty in over 90 countries by collaborating with local organizations. At any given time, Oxfam affiliates are responding to 30 emergency situations around the world. This outreach would not have been possible without creating partnerships to increase the impact of their work. Creating partnerships with business organizations in different areas can also help non-profits and smaller scale social ventures to gain access to funding and knowledge-based resources.
Note. The above is an abridged excerpt of a longer, detailed report I wrote on how social ventures can scale their impact looking at the growth of religions worldwide. Drop me a message if you’d like to read the whole report and the citations for this piece!