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How do You Scale a Product-led Company?

To scale a product-led company, the core product has to evolve into a platform, or it becomes a feature. In the new series Scaling X, a new original podcast produced by Sumeru, Host Mark Healy examines how others can successfully grow a company. In this episode, “What It Takes to Scale a Product-led Company with John Brennan,” Guest and Sumeru Managing Director John Brennan reveals the answer – and more. Forging 15 years of industry experience as a technology-growth equity firm, this successful organization and its leadership team describe how to champion a product-led company.

What Is a Product-led Company?

A product-led company follows a product-led growth (PLG) business model, which utilizes a product to scale a company. Many forecast that this popular approach will dominate in 2022, and Brennan couldn’t agree more. The software companies within Sumeru’s portfolio rely on this self-service product strategy.

Brennan is well-versed in the product-led model. Before joining Sumeru, he led the Adobe Systems platform software business unit and Hewlett-Packard Company’s SNB segment operations as senior vice president.

Reflecting on his experience, Brennan believes that product-led companies must produce a quality product that solves a problem and delivers a satisfying customer experience. “A product in and of itself doesn’t simply exist in a vacuum,” said Brennan. “We’re in a fight for people’s attention. And to get their attention, we need to deliver something valuable to them.”

Brennan’s solution to acquire and retain users is for companies to create a compelling product that people desire and find deeply important. From frictionless, self-service experiences to valuable insights to entertaining content – the product must be useful and helpful for people to actually adopt.

If you build it, consumers will come – but will they come back? According to Brennan, successful product-led companies are not just selling a product. They are selling a philosophy and a lifestyle. This is foundational to delivering a unified customer experience. “It’s a commitment at the heart of it to give people really a world-class product experience,” said Brennan. Thus, the product becomes the “main vehicle” for the business operation, marketing, sales, customer acquisition, customer support, retention and so on.

What Are the Challenges of Product-led Companies?

One word: competition. Now, more than ever, the market is highly competitive to be the first to launch a unique product and convert a user towards adoption.

Cloud-based computing, better tooling, development environments and lower the barriers to building software-oriented solutions. “The premium today, and part of the reason I’m so passionate and committed to the product-led growth, is you cannot relent on continuing to evolve your product because people can build the product and they might have a twist or an insight that’s better than yours,” said Brennan. He suggests that founders should have a healthy sense of paranoia to keep them innovating.

How Do You Scale a Product-Led Company?

Brennan reminds founders that product-led companies must start with a high-quality product. “The product simply needs to be great,” said Brennan. “Not okay. Not good. It needs to be very good or great.” This type of execution allows you to gain a competitive advantage and immediate credibility.

Additionally, to scale your business and win against the competition, founders must seize the opportunity to transform their category-defining product into a platform. Brennan recommends that “every product needs to evolve into a platform or it will deteriorate into someone else’s feature.” Undergoing a product-to-platform transition expands companies from a single to multiple revenue streams. Moreover, it protects your product as inimitable.

Finally, founders should exemplify product leadership. This form of leadership champions a product-inspired culture by thinking holistically about the product experience. “We find that our leading entrepreneurs and our leading founders are absolutely able to scale up and down, up into the strategy and down into the detail,” said Brennan. From big-picture strategies or day-to-day details, it’s imperative to understand the product environment, user experience and competitive landscape to bolster product-led growth.

Listen Up

Are you searching for helpful ways to grow your business? Listen to the Scaling X podcast: “What It Takes to Scale a Product-led Company with John Brennan.” Brennan shares how to scale a product-led company, what investors look for in products and what founders may overlook. You will also get to know more of Brennan’s story as the Sumeru Managing Director.

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