I’m not a fan of Donald Trump but one thing he said made some sense:
“If you’re going to be thinking, you may as well think big.”
This, to me, is one of the keys to building a successful business. Amazon didn’t set out to build a business which was 25% the size of Wal-Mart. And Musk didn’t create Tesla to make a bit of a dent in combustion engine vehicles. They both set out to change the world.
The challenge is that thinking like this rarely comes naturally. For whatever reason – whether it’s our experiences in school, life or work – most of us simply don’t think along these lines. At least not without some encouragement. This is a large part of my role at Octopus now. I spend a lot of my time asking questions, challenging assumptions and trying to give people the confidence that’s required to set big, bold targets.
Think big for your New Year targets
The end of the year is normally when this approach is needed the most. As businesses start gearing up for the year ahead, a huge amount of time is spent setting new targets. There are two ways to do this. The first (and easiest) way, which is what almost every business does, is to take the previous year’s budget and add a bit on. This will lead to incremental improvements, but nothing radical. If you want to build an Amazon or a Tesla, this isn’t the route to follow.
To build a business that changes the world, you need to think differently. You need to free yourself from constraints and put all the reasons why it won’t work to one side. To help drive this change, think big and look much further out than the next 12 months. Imagine what your business will look like in five to ten years’ time, then work backwards from there. This is the most important point: work backwards from the big, bold target. Don’t build on what has happened over the previous 12 months.
Choose a disruptive theme
Telling someone to “think big” is a pretty abstract concept, so it might help to give some more practical advice. When thinking about your business’s goals, start with a single theme – one you’re pretty sure will happen and will create massive disruption for existing businesses. Then, look for opportunities within that theme.
Applying this to Octopus, one of the most obvious themes for us to go after is climate change. Governments, investors and individuals have all woken up to this problem and are demanding change. And where there is change there is opportunity.
First is the opportunity to build and manage renewable energy assets. The scale of this opportunity is mind-blowing – £5.5 trillion will be invested in renewable energy over the next few decades. To put this number in perspective, that’s more than the collective market value of every company listed on the London Stock Exchange today.
The second opportunity is in energy supply. The industry is worth trillions of dollars and is one of the last industries to be disrupted by technology. The situation in the UK, where millions of customers are frustrated with the service and the pricing of their existing energy suppliers, is replicated in almost every developed market around the world. The opportunity really is huge.
These customers want three things: clean energy, to pay a fair price for it and to get great customer service. We think we have the answer, using Octopus Energy and the technology behind it. But Greg Jackson, the CEO of this business, isn’t measuring his team’s success based on what’s gone before. Growing to five or ten million customers in the UK isn’t his goal, or his measure of success. He’s thinking about disrupting the industry globally. He’s thinking about what it would take to build an energy supply business serving 50 or 100 million customers. And then he’s thinking about the practical steps he needs to take in the next 12 months to make this a reality.
Make big goals a reality
The tricky thing about having big goals is connecting them to what people in the team do every day. This is largely about mindset – it’s about ensuring that people look to where they’re going rather than where they’ve come from.
Take the Octopus Renewable energy investments business, run by Matt Setchell and Alex Brierley. They recently launched a listed fund to make further investment into renewable assets. They’ve been working towards this goal for years, patiently laying the groundwork. It may have seemed like a challenge at times, but their hard work made it a reality. The fund launched recently and was the most successful of its kind in 2019, raising £350 million.
While I know Matt and Alex are pleased with the fund’s success, they view this as the start of the journey. They have the team, the deal flow and the vision to grow that fund to many times that size over the next few years. And to do so, they will look to the future, rather than the past.
The same long-term thinking can and should apply to personal goals. As I’m thinking about possible New Year’s resolutions, I won’t be thinking about small adjustments. I’ll be thinking about big, meaningful changes I can put into place that will make a difference to my life and the lives of those around me. And you should be too.