Former Tesla President Discloses The Secret To Scaling A Company

Few companies person grown arsenic quickly arsenic Tesla, particularly conscionable earlier and aft nan institution launched nan Model 3, its first affordable EV.

“We scaled Tesla successful 30 months from $2 cardinal successful gross to $20 cardinal successful revenue,” Jon McNeil, nan erstwhile president of Tesla who is now co-founder and CEO of DVx Ventures, told nan crowd astatine TechCrunch’s All Stage arena successful Boston.

It wasn’t McNeil’s first clip scaling companies, nor would it beryllium his last. Previously, he founded six different companies, and aft Tesla, he joined Lyft arsenic COO earlier starting his ain task firm, wherever he’s launched a twelve startups.

Over nan years, McNeil has developed a playbook that helps him place erstwhile a institution is ripe for scaling. He shared those insights past week pinch nan assemblage astatine TechCrunch All Stage 2025.

When assessing a company’s imaginable to scale, McNeil chiefly judges them connected 2 different measures, product-market fresh and go-to-market fit. It’s not different for investors to attraction connected those concepts, but McNeil has distilled them into 2 nonsubjective measures.

For product-market fit, he asks each startup, “do 40% of your customers opportunity they cannot unrecorded without your product,” he said. If not, past nan institution isn’t ready. 

“We support adding, adding, adding and tweaking nan merchandise until we get to 40% and past we say, okay, boom, now we’ve sewage merchandise marketplace fit,” McNeil said. “It’s really nonsubjective and measured. It’s not a feeling, it’s not a sense. It’s a metric.”

McNeil added, “We did a study of businesses that really achieved breakout, and those businesses achieved breakout astatine astir that 40% acceptance level.”

Second, McNeil looks astatine whether nan institution has a mature go-to-market strategy. Specifically, he’s willing successful whether nan magnitude a institution spends to get customers, known arsenic customer acquisition costs (CAC), is sufficiently beneath nan full life worth (LTV) that nan customer will bring nan company. 

When a institution starts pulling successful 4 times much money complete nan life of nan customer than it spent to get them — an LTV to CAC ratio of four-to-one — that’s erstwhile he knows nan institution is ready.

“Then we move successful nan cash. But earlier then, we’re doling retired rate $100,000 astatine a clip conscionable to get to different shape gates,” he said.