29 Jan 2020

By Reid Hoffman

5-min read

Blitzscaling: The Silicon Valley Secret to Starting and Scaling Massively Valuable Companies

A good idea should stand up to being looked at from many perspectives, pushed in new directions, and occasionally given a sharp kick – which is what happened when a room full of technology and business leaders talked ‘blitzscaling’ with its creator, Reid Hoffman, Partner at Greylock Partners and Co-Founder of networking platform LinkedIn

Distilled to four words, ‘blitzscaling’ refers to the ultrarapid growth by start-ups. It is a simple expression with contrarian logic, difficult to execute, but promises huge rewards for those who are able to execute it successfully. For those who are less familiar with the concept, Reid explains this on Medium, “7 Counterintuitive Rules for Growing Your Business Super-Fast”.

In a candid Q&A moderated by James Manyika, Senior Partner at McKinsey & Chairman of the McKinsey Global Institute, Reid shared practical insights on how one might blitzscale in their respective workplaces. Here are three principles and some of our favourite exchanges

Three principles we took away:

  1. Blitzscaling is deeply counter-intuitive. To achieve blitzscaling, check your rationale preconceptions at the door – you will have to go against common sense.
  2. Blitzscaling is profoundly human – it requires a very keen awareness of human nature and behavior to execute.
  3. There is something in blitzscaling for everyone. While most know blitzscaling as the engine that helps start-ups scale, its basic principles can be applied to every type or organization, from small businesses to multinationals or even state-owned enterprise
Select exchanges:

Q: Should public, listed companies, with potentially risk-averse investors, attempt to blitzscale? – CEO of a leading regional telecommunications network in Asia

RH: “Absolutely, if everyone whose support is critical is prepared for it. Investors have to be patient and tolerate the demands of blitzscaling, and keep their focus on the long game, instead of paralyzing the process with dialogue. Large companies will also need to protect and ‘nurture’ their blitzscaling shock troops, and ensure that they have their own culture and rules, and ideally, their own location. This is so the ‘host body’ does not see their presence as being invasive and attempt to undermine them.”

Q: Are the principles of blitzscaling the same for a 100-to-500-person business as they are for a 10-person startup just beginning to scale? – CEO of a leading online classified business in Southeast Asia

RH: “Yes – the key principles are the same, but for the start-up, the game will continually change along the way, so it is important to apply blitzscaling fundamentals at every stage of development. If after years of growth your processes and procedures are starting to take shape, you will need to continue honoring the first – and most important rule of blitzscaling, which is to embrace chaos.

It will be counter-intuitive to “disrupt” your own systems, but that is the essence of blitzscaling – being contrarian, and flying in the face of “best practices”. Consider the by-products of ongoing chaos: customer complaints, bad products, management crash-and-burns. It will require great discipline to persevere through these painful experiences, which most companies go to great lengths to avoid, but they cannot be avoided if one is determined to blitzscale.”

Q: Let’s also talk about the ethical dimensions of blitzscaling. Are the critics right when they call blitzscaling irresponsible? Can blitzscaling be approached responsibly? – James Manyika, Senior Partner, McKinsey & Co., Chairman, McKinsey Global Institute

RH: “Indeed, many things go wrong when you blitzscale, but there are ways to reduce the trajectory of something significantly going wrong. You can, and should be able to, build in responsibility as you scale without reducing speed. Here are some ways:

  1. Identify your risk sets, and distinguish between inconvenient failures and critical ones;
  2. Constantly reinforce the expectation of change over stability;
  3. Set and communicate company values early on The last one is the most important, as when people know what they are working for and have a clear sense of the mission, they can better handle uncertainty and choose positive behaviors when things do get rough.”
What gives blitzscalers the edge

A common question is what gives Blitzscalers the edge over everyone else. Falling back on the principles, Reid offers what he concedes is a “potentially outrageous assertion given the vast human abilities”, but an equally poetic response:

“It is the willingness to embrace the irrational – to go against common sense and follow principles that are deeply counter-intuitive – that makes blitzscaling so unique.”

Blitzscaling can easily be confused with technology excellence, given the intersections with artificial intelligence, automation, and the other mass technological evolutions. However, at its core, technology is simply the vehicle – what blitzscaling requires the most is an explicit theory of human nature.

The best consumer technology companies have always scaled not to technology, but to the humanity that makes their technology possible, Reid reminded. That is why blitzscaling is so powerful, and ultimately, responsible – it only works if it serves our shared humanity. The chaos, disruptions, mistakes and burning fires are simply the price we pay along the way.

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