Is lack of focus stunting your growth?
How narrowing tightly helps social ventures drive income and impact
Orville Redenbacher spent his life perfecting popcorn. After being named The Popcorn King, making millions in sales, and becoming part of an $8B food company, a reporter asked the 79-year-old his secret of business success. He said: “Do one thing and do it better than anyone.”
Yet focus is a primary problem for our clients. It’s certainly the area we have the hardest time convincing our clients. They know they need a strong brand, clear messaging, tight positioning, and compelling marketing communications to drive more income. But when we tell them these things require the courage to focus… let the backpedaling begin.
I explored the other side of the argument – searching for examples of companies, in any sector, that grew by doing lots of things from (or even near) the beginning. They don’t exist.
So I want to convince you of something important and instinctive, but often ignored. You cannot grow a social venture to significant impact without intense focus.
In this post, we’ll look at what it means to focus. I’ll show you well-known corporate brand case studies. I’ll share social sector examples. We’ll unpack reasons social ventures don’t focus. And then identify a few areas to start the courageous narrowing.
What do we mean by focus? And why does focus matter?
Setting a clear direction. Making binary decisions. Putting a stake in the ground. Simplifying an outlook. Stripping away excess from a core belief. Committing to a geographical area or population. Solving a defined, specific problem – not problems. Applying a replicable process to multiple situations. Eliminating distraction. Deliberately and courageously saying no more than yes.
And here’s why focus matters.
Most weighty social challenges will take generations to solve. There’s plenty of work to be done in any single area. But all too often, social ventures reach beyond core causes and try to address too many problems at once. Then they end up solving none.
Mission drift can crush organizations when leaders develop FOMO, become overambitious, or start thinking the grass is greener.
Constrained resources mean you have to make the most of every available one. You don’t have the luxury of distraction.
Teams need clarity. Without it, how do you (and they!) know if their daily work is actually driving change? Lack of focus leads to internal confusion. So think about how hard it is for the external world (customers and funders) to understand what you do.
But wait, you say. There are thousands of organizations not tightly focused that seem to be doing fine.
Fair enough. But the cold, hard truth is: these aren’t organizations stuck at a few million in annual turnover. We’re talking about the tough task of reaching tens or hundreds of millions in size, so you can significantly address the world’s greatest problems. There are plenty of ways to stay unfocused and still generate a couple million a year in funding. But as Bridgespan Group has proven, only 1 in 1,000 social ventures grow to $50 million or more.
So find your core focus, stick to it, and devote your time and resources to excelling at it.
Only 27 years post-genocide, many Rwandans face a host of challenges – from healthcare to unemployment to housing. But EarthEnable is crystal clear on its focused role in moving the country forward: providing affordable, sanitary domestic flooring to millions of people.
“Anything is possible, but everything is not.”
A look at household name brands.
Let’s quickly debunk one popular argument: well, the world’s greatest brands are diversified, so why can’t we?
McDonald’s sold one billion hamburgers and reached $850 million in size (adjusted for inflation) before introducing the Filet-O-Fish. And it was more than 40 years old with 6,000 stores around the world before launching the McChicken sandwich.
Apple spent 25 tumultuous years making computers before the iPod came along. Then it sold 120 million iPods before introducing the iPhone. Get this: Apple generated $6 billion in annual revenue (not adjusted for inflation!) before touching the music business.
Virgin built a records empire before launching the airline. It was a 14-year old company when Richard Branson bought a single Boeing 747. And flew that one plane on one route for two years. Later, Branson reluctantly sold Virgin Records to keep Virgin Atlantic afloat.
Starbucks had grown to $1.5 billion in revenue (adjusted for inflation) over 23 years. How? By selling coffee. As the company scaled, it tried to profit by adding CDs, sandwiches, and other drinks to the menu. Those efforts flopped. And 900 stores closed.
The list goes on and on. So let’s stop using these popular brands as social sector inspiration.
McDonald’s built their business on beef, selling one billion patties before trying their hand at fish. The company was four decades old before venturing into chicken.
Focus in the social sector.
Does the same focus story from the corporate world hold up with nonprofits and social enterprises?
Trusts and foundations with major endowments make up the largest of all social sector brands. But they have nearly unlimited funding, so there’s no focus comparison to be found. They can do whatever they want.
Then look at the top five richest implementing charities in the world. Each has revenues in the billions. Yes, billions. From the YMCA founding in 1844 to Catholic Charities in 1910 or the more modern BRAC in 1972 – notice one major similarity. The largest nonprofits have been around for decades, if not a century. Again, no comparison to growth-stage social ventures.
So what is the comparison then? We often look at the well-admired Skoll Award Winners list for good examples of both recent growth and impact. These winners are the sector darlings. And, no surprise, most found their way to this centerstage with… focus.
Girls Not Brides: child marriage. Khan Academy: free education online. Last Mile Health: community health workers in Liberia. One Acre Fund: tools and financing for smallholder farmers. Blue Ventures: rebuilding tropical fisheries. Vision Spring: eyeglasses. Educate Girls: it’s in the name.
Like corporate brands, the list is endless. All are so focused and clear, most can see the name and say exactly what they do.
Still don’t believe me?
Here’s one of the most compelling data points in the social sector that speaks to the power of focus. It’s from the same Bridgespan Group study mentioned above of 200,000 nonprofits over a 40-year period. Of those that scaled to $50 million or more in annual turnover, 90% raised the bulk from a single type of funder such as corporations or government. Not – as conventional advice would recommend – by going after diverse sources of funding.
Advancing girls has a powerful ripple effect across society. The effort must be multifaceted, taking on issues like education, employment, and reproductive rights. Girls Not Brides, as the name clearly states, focuses their energy on ending child marriage.
Why focus is so hard.
With all those examples in hand, why is it so hard to narrow down? In gardening, there’s no room for growth without pruning. But when it comes to business, we have such a hard time cutting a single limb. Here’s what we think lies behind that struggle:
Of missing out on a grant. Of pissing off a board member. Of losing a team member who is passionate about one area that’s off mission. Of the unknown.
You enjoy doing lots of things. After a few years, you’re bored. Visionary CEOs hate constraint and enjoy exploring new products and programs.
Institutional funders are the worst at pushing you in multiple directions based on their priorities, not yours. But is it worth it? Are there other funding options?
Many leaders have the ego to attempt the unbelievable. But to also believe they are different, and can indeed do it all. Or at least do more than most.
The fear around funding is about the only reason we can understand. If you’re a startup or in crisis mode, sure, throw spaghetti at the wall and see what sticks. But a scattershot approach is not a long-term strategy.
“Your strategy allows you to discern an opportunity from a distraction.”
How to start focusing today.
If I’ve managed to convince you to muster the courage to start focusing, let me suggest a few areas in which to start. These match up with the Mighty Ally Four A’s framework.
Focus starts with a clear and concise theory of change. Choose a single, specific problem to tackle. Target a narrow group of people to serve. Develop limited interventions that aim to change only a few behaviors. Map your mission to only a handful of outputs and outcomes. And name a clear vision.
Next, your positioning strategy gives you ample opportunities to tighten further. Approach the thin gaps, not noise, in the landscape. Pick discrete audiences to reach vs. aiming at everyone. Know your differentiators. And develop brand promises for those audiences that stay consistent.
With marketing communications, resist the urge to go scattershot. Fine-tune your messaging and stories. Strip down your website to communicate only the essentials. Define clear goals, strategies, and only two (two!) channels. Then measure everything with just a few key performance indicators.
And finally, with strategic planning your courage to focus gains internal traction. Your leadership and people should be operating with rigid priorities, rhythms, and data. A strategic plan keeps you on the straight and narrow – aligning every week, quarter, and year on the master plan.
If all this sounds scary, here’s the deal. You’re not a horse, so don’t confuse laser focus with blinders. Focus doesn’t mean you can’t shift or adapt. Focus also doesn’t mean you can’t be wrong. You may choose a focus, only to find out it’s the wrong focus, or there’s a more right focus out there for you. There’s a reason we say focus requires courage. Because focus demands a choice, a decision, a deliberate action. And those come with risks.
But, we’d argue that attempting something, finding out you’re wrong, and course-correcting swiftly is more productive than ambiguous activity that may or may not tell you anything at all.
“Choosing a focus doesn’t make you any smarter the next day. But it sets you on a path where you get smarter at a much faster rate, starting on that very next day.”
DAVID C. BAKER
Before you go.
Let me tell you about Kongō Gumi, a Buddhist temple construction company. Founded in 578 AD, it remained the world’s oldest continuously operating company for 1,400 years. For 14 centuries, they kept busy building temples, becoming experts in their craft. And making plenty of money while doing good in the world.
Then, during the 1980s Japanese market boom, they decided to expand into real estate. With uncontrolled credit access, Kongō Gumi took on more than $300 million in debt. By the 1990s, the bubble had burst. Years later, Kongō Gumi was liquidated.
The company had survived countless natural disasters, great famines, political changes, world wars, and even two atomic bombs. How? By focusing. But its ultimate demise? Losing focus.
Kongō Gumi was a family-owned construction business turned historically significant independent company. Its laser focus built a longevity record unlikely to ever be broken (40 generations!). But falling out of focus led to its rapid demise.
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