Scale-ups and High-Growth Firms: Theory, Definitions, and Measurement (SpringerBriefs in Business)

distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made. The images or other third party material in this book are included in the book's Creative Commons license, unless indicated otherwise in a credit line to the material. If material is not included in the book's Creative Commons license and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Acknowledgments Contents About the Authors Abbreviations 1 Introduction and Motivation 1.1 Introduction 1.2 Early Work Focused on Anecdotes and Case Studies 1.3 Scope of the Book 1.4 Why a Book on Scale-Ups? 1.5 Overview of This Book References 2 Firm Growth, and High-Growth Firms 2.1 Introduction 2.2 Empirical Definition of Firm Size and Firm Growth 2.3 High-Growth Firms: The Eurostat-OECD (2007) Definition References 3 Stages of Growth Models 3.1 Stages of Growth Models and Their Discontents 3.2 Scaling up as a Stage of Growth 3.3 Changes in the Structure of Growing Firms 3.4 Born Scale-ups? 3.5 Can Scale-ups Have More Than One Product? 3.6 Blitz-Scaling vs the Lean Startup Perspective on Scaling up References 4 Eight Propositions About Scale-ups 4.1 A Scale-up Is a Concept Born of Practitioners, Not Academics 4.2 Scale-ups Are Not Just in the IT Sector, But May Be Enabled by IT 4.3 A Scale-up Is a Qualitative Concept from a “Stages of Growth” Model 4.4 Scaling up Involves Structural Transformation 4.5 A Scale-up Does Not Exist Anywhere in a Pure Form 4.6 Scale-ups Differ by Degree, Not by Kind 4.7 Too Many Exceptions 4.8 There May Never Be a Standardized Empirical Definition of Scale-up References 5 Theoretical Definition of a Scale-up 5.1 Firm Growth or Scaling: Reinventing the Wheel? 5.2 Previous Definitions: A Critical Discussion 5.3 Five Suggestions for How a Scale-up Should Be Defined 5.4 Discussion of Well-Known Cases 5.4.1 Is Uber a Scale-up? 5.4.2 Is Apple a Scale-up? 5.4.3 Was Obama’s 2012 Campaign a Scale-up? 5.5 Our Theoretical Definition of a Scale-up References 6 Empirical Definition of a Scale-up 6.1 Scaling up Is More Than Just Growth, or Not? 6.2 Four Desirable Properties of an Empirical Definition 6.3 Empirical Definition of a Scale-up, in 2 Steps 6.3.1 Step 1: Identify the Set of HGFS 6.3.2 Step 2: Scale-ups as a Subset of HGFs References 7 In Search of Scale-ups: Empirical Analysis 7.1 Data Description 7.2 Results 7.2.1 Frequency of HGFs 7.2.2 How Many HGFs Satisfy the Conditions for Being Scale-ups? References 8 Concluding Remarks 8.1 Concluding Remarks References This open access book goes into the details of the characteristics of scale-ups, touching upon various theoretical perspectives (stages of growth models, the role of intangible capital, the tradeoffs between fixed costs and marginal costs) relating to firm growth, to provide a clear definition of this emerging concept. Given the disproportionately large economic contribution of a small number of fast-growing firms, there has been growing interest in a category of dynamic ventures called "scale-ups". The term was popularized by Silicon Valley Venture Capitalists before receiving attention from academics and public policy makers. However, there remains considerable confusion regarding what a scale-up actually is. This is an open access book.