Disciplined and intentional scaling: How Propeller leads a lean, smart path to startup success
You might say that Propeller was ahead of its time. Long before the current global economic crisis, it had pursued a lean strategy and was fearless in reinventing itself to get ahead. Founded as a drone-focused company in 2014, it initially cast a wide net for customers before settling on industries that move earth: mines, quarries, construction, and waste management. Since then, the company has produced and evolved an integrated workflow that delivers data-driven insights into progress and problems on job sites around the world. Digging into its unique path to success, we can find insights that can help almost any startup at any stage.
Key takeaways
Constraints are healthy. Born into a constrained startup environment in Australia, Propeller has always chosen to be capital efficient: focusing on its customers, allocating resources to the right places, and maintaining a disciplined strategy.
It’s about the dirt, mate! While Propeller began life as a drone data company, it evolved to deeply understanding the plainspoken environments in which it operated, eventually producing an exceptional product that has little to do with drones. Rather than trying to capture multiple audiences at once, the company focused on serving earthmovers really well.
Go-to-market discovery is as important as product market fit. Propeller has consistently looked for new avenues for sales as the scope of the company’s ambitions has grown.
Constraints are healthy.
While the venture capital environment in Australia has evolved in recent years, when Propeller launched, startups in the country generally didn’t raise as much capital as those in many other parts of the world. So, from the start, Propeller was deliberate in every decision it made with the goal of establishing a capitally efficient culture.
“Constraint breeds great decisions,” says Rory San Miguel, Cofounder and CEO of Propeller. “No one makes great decisions when there is plenty of anything.”
Propeller established a cost-conscious culture, with senior managers flying coach and growing the team at a reasonable pace. In addition, it opened its first offices in Sydney, where it took advantage of a 40 percent rebate the Australian government offered for research and development work done there. Finally, the company hired consciously and deliberately, careful not to scale too quickly.
“We always went our own way,” says San Miguel. “We never wanted revenue and headcount to get out of whack. So, we were sure to only add more people as we became more stable as a business.”
It’s about the dirt, mate.
Of course, cutting costs alone does not guarantee success. In order to solve problems for an industry, you have to know it inside and out — and then let that knowledge inform your product development efforts. Propeller established its two main offices in Denver and Sydney — both close to partners and job sites. And they intentionally spent a huge amount of time in the field, listening and learning along the way with their customers.
We can see this from the evolution of Propeller’s solution. Early on, the team developed a solar-powered ground control system, AeroPoints, that increased drone data accuracy. Over time, the company realized that drones, while useful, had limitations. Among other things, they required trained operators to fly and delivered data only once a week. Propeller eventually enhanced its offering with DirtMate, a Wi-Fi-enabled device that sits on top of any truck moving around a job site.
DirtMate needs no specialized expertise to operate, while delivering data about the movement of every load of earth in real time. Same data but a lot less effort by their customers to get value.
“Even though we started out with drones, we really are a data company,” says San Miguel. “DirtMate gives sites data in real time as the machines are doing the work. It lets us deliver more and more valuable insight much quicker than we could before.”
Go-to-market discovery is as important as product market fit.
Too often, companies can be too rigid in their processes. If you stick too fast to your lane, you may end up optimizing a less-than-ideal approach, rather than thinking out-of-the-box about the right way to solve their problems.
Propeller has instilled a nimble culture that is open to experimentation in every aspect of its business. When it first began prospecting, for example, it partnered with drone operators, who had experience in selling to construction companies.
This proved only moderately successful, so the company started selling directly to potential customers. They quickly found that this allowed them to build relationships and understand the customers’ problems better. However, Propeller eventually found an even better solution: working with established businesses like Trimble and Komatsu. And today, Propeller continues to experiment, never satisfied with one solution.
Propeller’s curiosity and drive to always improve shows that while many startups are agile in seeking ways to find product market fit, they need to be flexible about everything they do, from staffing to sales.
Startups around the world today are looking for new ways to survive and succeed. The healthy, intentionally constrained, and logical path favored by Propeller may not reflect the flashy, hyper-growth model glorified by many in the past, but it’s perfect for the present moment. Companies need to know their customers better, be purposeful in their choices, and willing to try whatever approach works. It has never been easy to navigate a global crisis, but if history shows anything, it’s that the companies that take foundational steps during times like these that see outsized returns during the recovery.
