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CMA Final · Entrepreneurship and Startup · Scalability, Scaling up and Stabilisation of Sustainable Business

Which of the following is the most accurate distinction between 'growth' and 'scaling' of a business?

Growth adds revenue with roughly proportionate additions of resources, while scaling raises revenue much faster than the resources added, so margins improve. Scaling is therefore about efficient expansion of the model, not about listing status, cost cutting or merely the time taken.

  1. AGrowth means revenue increases only with a proportionate rise in resources, whereas scaling means revenue increases significantly faster than the resources addedCorrect
  2. BGrowth is possible only for listed companies, whereas scaling is for unlisted startups
  3. CGrowth refers to cost reduction, whereas scaling refers to revenue reduction
  4. DGrowth and scaling are identical and differ only in the time taken

Explanation

Growth typically adds revenue by adding roughly proportionate inputs such as staff or outlets. Scaling increases revenue at a much higher rate than the inputs, improving margins. The other options misstate the concepts.

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