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Exponential Growth: the technological evolution dictating new business models

Have you heard of exponential organizations? And growing exponentially? Possibly not in that term, but certainly you have heard about it.


At first it seems very difficult to make grow a business significantly. It’s not what the Exponential Growth concept stands for.

We will talk about this throughout this article. Read on to understand what Exponential Growth is, how you can use technology to scale your business at exponential rates and more!

Exponential Growth: Understand the concept

There are only three ways to grow your business: increase your number of customers, increase revenue per transaction, and increase the number of transactions or frequency of transactions. If you master one of these, you will experience linear growth.

To get to Exponential Growth, what you need to do is master two or more ways of growth: to increase the number of customers voluminously, increase revenue per business transaction, and perhaps at the same time increase the frequency of transactions.

So when we talk about Exponential Growth, we are referring to growth that is not linear; it is giant and continuous; it’s with bulky and unobstructed scale – or with frequent overcoming of various obstacles.

Exponential Organizations

Canadian Salim Ismail – serial entrepreneur, angel investor, author, speaker and technology strategist – coined the term Exponential Organization in his eponymous book. He lectures on how linear thinking has been superseded by exponential thinking in many companies.

Basically, this author treats as exponential organizations those who win an army of passionate fans – team members, suppliers, partners, customers, or the general public. For him, these thousands of minds become an extension of the company itself.

Think of the number of people who are fans of Apple. These consumers love, advertise and are able to spend days in kilometer-long lines to be the first to buy the new iPhone. Apple is an exponential organization.

The main characteristics of exponential organizations, according to Ismail, are:

  • long-term mindset and innovation culture;
  • superior capacity for dialogue with your stakeholders;
  • strong brand positioning;
  • guidance for experimentation;
  • strategic use of digital technology;
  • ability to anticipate and respond to market demands;
  • potentialities perceived by investors.

You read this far and thought “well, then we’re talking about megacorporations”. In terms, yes; but it is not only the big players in the market that can reach that level.

Stop thinking about the number of startups that started out shy and quickly became exponential deals – Uber, Netflix, Spotify, to name a few of today’s most successful digital businesses.

Today, with the help of crowd funding, for example, you can get funding for projects that are still on paper – which goes beyond getting money; it gives you the chance to test ideas while they have not even been transformed into prototypes, and allow you to fail fast to correct in a timely manner.

Businesses that can transform themselves into exponential organizations also have the use of so-called “social technologies”, tools that help reduce bureaucracies, generate collaboration, integrate processes and teams, make fast and reliable decisions, and so on. – emails, intranets, file sharing systems, instant messaging applications and task management, among others.

In short, exponential organizations adapt their business models to the new market dynamics – or they are born into this reality. They are heavily grounded in technology and collaborative economics, have brought together a multitude of fans and collaborators, have excellent brand positioning, invest in marketing and communication, and produce offers (services and products) that provide great experiences for consumers.  

How to: steps to becoming an Exponential Organization

Here are a few initial steps you must take to keep your business from growing linearly and growing exponentially – not necessarily in this order.

Establish mindset exponential growth

It all starts with business culture. It is necessary to create an exponential growth mentality to be incorporated by all the actors of the company. Without this, people will continue to think on a linear scale and will have difficulty engaging in new endeavors.

Reading this article is a start, but we need to go deeper. Invest in qualification courses, participate in events… There are many ways to change an organizational culture; they must all be paved by knowledge.

Create a network of connections and collaboration

To get exponential growth, as you’ve seen, you need to make your efforts flow beyond the four walls of your business.

Work for your business model to include a good Open Innovation strategy, that is, for partners (suppliers, startups who deliver complementary services, among others), customers, fans, and a broad audience to collaborate with innovation efforts of your company.

→ Read also: Open and Closed Innovation: what are the differences?

Guide your business to the crowds

Former employees, customers, suppliers, partners and fans… The crowd is everyone outside the traditional circle of your core business.

You have to turn the crowd into a community, because that’s where the magic happens. It is when peer sharing happens, and all members of that community can benefit from the shared wisdom and experience of everyone involved in the project – your exponential organization!

Crowds can also be used for validation. Need to know if something works? Ask the crowds. Stuck in a box without being able to think differently? Ask the crowds. Do you need funding for a new project? Open a crowdfund; appeal to the crowd!

Establish and maintain excellent relationships with your stakeholders

For continued growth, your business needs to keep its community and its crowds involved. It will not help if they start to forget the deal.

Your brand must always be visible. It needs to be present and interact with people.

Get involved with the community and the crowd using campaigns, competitions, games. Not only will this help retain the fans, but it will also provide the benefit of ongoing knowledge sharing.

Competitions, for example, encourage talented or talented teams to do their best, and games can be leveraged to enable individuals around the world to help in a simple aspect of a complex task, greatly reducing the workload.

But at the end of the day, always keep in mind that the goal is to empower and not to explore. This is what will make the difference between an organization with exponential growth and others with linear scale.

→ Learn more:

Invest in digital with a strategy

Digital technology enables rapid scaling, expense reduction, and community engagement. Investments must be made before and continue with diligence, discipline and determination as the nascent network is developing.

Make digital a central pillar of your business. That is, work so that your digital actions (be it marketing and communication or the creation of digital products) are carried out strategically; with clear goals, metrics to scale the results etc.

Turn your attention to the algorithms

Still within the technology topic, we need to focus on algorithms.

Algorithms gave leaps and advances in the various sectors. Google has built its fortunes by creating and strengthening the algorithms behind its search engine.

The point of all this is that algorithms, Big Data and machine learning are the future and it’s time to embark on that move. Collect your data, organize them and apply machine learning tools such as Hadoop, for example. Finally, expose it to the crowd, where more new information can be placed on existing data.

Have a good team and hire expert help

Virtually all firms that jumped from linear to exponential growth went beyond their internal productive capabilities. They have kept the most prepared professionals in their teams and have outsourced specific processes and activities to specific projects.

This topic is a continuation of the already presented concept of Open Innovation. If you want to make your business an exponential organization, you need to be open to seeking expert help. This goes from hiring consultancy firms or even partnering up with service providers, especially with regard to technology.

Emerging technologies: the future is exponential

Finally, we decided to dedicate a special section of this text to the emerging technologies that must be present in an Exponential Growth strategy.

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