Building the Flywheel:Creating Sustainable Revenue & Profit Growth

Welcome to the first edition of the “Building the Flywheel” newsletter!  I decided to start this newsletter to share some experiences in what I’ve discovered to be a challenge many have faced in overcoming the revenue growth hump and scaling to a cashflow positive business.  Like many people, I read Jim Collin’s classic “Good to Great” early in my professional career.  But his concept of the Flywheel was one that, while it must have been ingrained in my memory somewhere, didn’t fully resonate with me until my first P&L ownership role. 

It's a huge challenge to take a business that clearly has products which resonate to some extent with the market but are not generating the growth and/or profit that would be expected from that traction.  But over the course of continued pushing of the flywheel – many coordinated actions around product-market fit, customer acquisition cost, redefining the playing field, getting everyone on the team pushing together – the momentum builds and builds until it becomes self-sustaining.

In reflecting on this, it struck me how important the term “P&L Owner” really is.  I’ve known too many P&L “managers” – those who follow all the right steps in reporting and creating the right slides to explain the current state of the business, but who are essentially just following the winds where they blow.  However, ownership implies a state of higher responsibility.  Merriam & Webster defines Ownership as “the quality or state of being accountable”.  As an owner, every decision and investment is made with a clear intent and accountability to improve the state of that asset.  Don’t just manage the reporting, instead own the outcomes.  Every decision is another turn of the flywheel, building the momentum.

Joel Klooster

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