Growth redefined: balancing ambition with resilience

Amid persistent economic uncertainty, tighter access to capital and changing investor expectations, the traditional scale-up playbook is being rewritten. Investors still want growth, but increasingly they want evidence that growth can be sustained. That means the next generation of high-growth companies must demonstrate capital discipline, strong governance and a clear path to long-term value creation.

The shift extends far beyond early-stage businesses. The latest EY CEO Outlook shows leaders sharpening capital allocation while continuing to invest in long-term strategic priorities.

Longevity, though, is not simply a financial outcome. Research from EY suggests that organisations navigating uncertainty successfully are often those that develop high-performing teams capable of adapting under pressure, sustaining momentum and responding effectively to disruption.

“When we started proSapient, the private markets we were serving were booming, and that was the wind in our sails that really helped get the business off the ground,” says Margo Polishchuk, founder and president of proSapient. “At the time, it was growth at any cost. But then Covid happened and we started hearing from private equity and growth equity firms that it was no longer about growth at any cost; it was about profitability, unit economics and margins.”

In this changing environment, some businesses are becoming more selective about where they invest, focusing resources on opportunities that create lasting value rather than pursuing scale for its own sake.

“Now I can’t just say yes to any business. I need to think about what type of opportunity is most valuable for our company,” says Polishchuk.

“We’re seeing a clear recalibration in how investors assess growth,” adds Rob Morris, partner at EY-Parthenon. “There is still a strong appetite for high quality businesses, but the emphasis has shifted decisively towards capital efficiency, resilience and a credible path to profitability.”

Sustainable growth over rapid expansion

The changing economic backdrop is reshaping growth strategies across industries. In food and beverage, for example, inflationary pressures and rising ingredient costs are encouraging brands to make deliberate choices about their market positioning.

“It goes one of two ways – you either see people leaning into more value-driven products or moving towards a more premium offering where they see value,” says Pip Murray, founder and CEO of Pip & Nut.

“That’s definitely been our position: to sit at the premium end of the market while remaining accessible. You have to work really hard to avoid being stuck in the middle ground,” adds Murray.

The emphasis on quality of growth has also changed how businesses are assessed.

“Investors are looking for solid unit economics to know that you’re not just growing by investing ahead of where you should be, or that if they stopped investing, the business would fall over,” says Murray.

That requires a more deliberate approach to brand building. Pip & Nut spent a decade steadily gaining ground on the market leader in its category, ensuring that when it became the UK’s number one nut-butter brand, it did so on a foundation that could endure.

Murray also says that one of the risks of chasing rapid growth is losing momentum just as fast if you neglect building a long-term connection with consumers. Capital constraints can also have positive effects though, encouraging businesses to commit resources only to initiatives with proven traction.

The shift in investor sentiment away from growth at all costs has also sharpened business strategy in other ways too.

Businesses that can demonstrate disciplined growth, underpinned by strong unit economics and clear strategic focus, are commanding the greatest attention in today’s market. This sentiment is echoed by proSapient’s Polishchuk.

“That rhetoric did help us focus on whether the business was really creating value. It meant thinking about margins, how we get to profitability and, from there, how we build EBITDA,” she adds.

Building for long-term success

For the next generation of fast-growing businesses, success will depend on balancing immediate priorities with long-term preparedness.

For Pip & Nut, that means considering how climate change and extreme weather could affect agricultural supply chains in the years ahead.

“We invest in a range of regenerative agriculture projects where our nuts are grown in Argentina and California, and that’s very much a long-term initiative,” says Murray. “It’s not necessarily going to have a material impact right now, but it helps us understand how our raw materials are sourced and how they can be grown more sustainably to protect us in the future.”

At the same time, businesses must continue to optimise costs and maintain commercial discipline.

“You’ve got to make sure you’re thinking about both. If you don’t, it will catch up with you in the medium term,” says Murray.

Long-term success also requires clarity about what differentiates the business.

“Numbers are proof that something is working, but what’s equally important is having a clear USP: how you differentiate from competitors, why your approach is resilient and why that advantage will endure,” says Polishchuk.

Future-ready businesses are also disciplined enough to avoid chasing every trend. Yet caution does not mean standing still. The EY CEO Outlook highlights strategic partnerships, selective M&A, digital capability, AI and supply-chain redesign as areas where leaders continue to invest despite uncertainty.

“We are seeing businesses staying private for longer – remaining largely self-funded and bootstrapped in many cases – partly in response to the higher interest rate environment and the downward pressure on valuation multiples in software and other sectors. Founders prefer to ride this out and give their business more time to again command the valuation they are looking to achieve,” says Scott Kenward, London private growth lead at EY.

For founders, the lesson is that the businesses most likely to succeed over the next decade will not necessarily be those that grow the fastest, but those that combine ambition with discipline, adaptability and a clear focus on creating enduring value.

For more than a decade, low interest rates and abundant investment capital helped fuel a generation of high-growth businesses. The firms that grew rapidly were able to raise funding relatively easily, typically aiming for expansion over near-term profitability and often deferring difficult decisions around efficiency and cash generation. Today, that environment no longer exists.

Higher borrowing costs, tighter lending conditions and more selective investors have fundamentally altered the economics of growth. Founders are under greater pressure to demonstrate financial discipline, clear unit economics and a credible path to profitability. It is a shift being felt across the market.

“When debt was cheaper in 2021 and interest rates were lower, there was a lot of venture capital being invested into consumer goods companies,” says Mark Rushmore, co-founder of electric toothbrush brand Suri. “With the benefit of hindsight, some of those companies took on too much money at very high valuations and subsequently struggled to meet investor expectations.”

However, Suri took a different approach.

“We’re relatively lucky as a brand in that growing efficiently has been central to our strategy from day one,” says Rushmore. “In that respect, we’ve not found it as difficult to raise capital as some others have.”

The company deliberately chose not to maximise growth at any cost.

“We could have taken on a lot more debt or sold more equity and achieved faster growth, but we would be in a worse financial position,” he says.

Capital discipline as a competitive advantage

The tougher funding environment has prompted many firms to focus on generating cash internally rather than relying on external funding rounds.

This trend is reflected in the EY CEO Outlook, which found that overall CEO sentiment declined as leaders reassessed demand expectations amid geopolitical uncertainty, supply-chain realignment and slower economic activity.

For Ola Oyetayo, co-founder and CEO of cross-border payments platform Verto, that has meant placing greater emphasis on profitability and cash flow.

“The way that we have internally adjusted for this is making sure that we’re generating enough cash internally – so being cash flow positive and profitable to stave off the requirements for going out to raise capital,” he says.

However, the challenge is that every pound preserved today may be a pound unavailable for growth tomorrow.

“We want to be the financial operating system for businesses that trade in or with emerging markets, but we can only meet that ambition if we are in a position where we can significantly deploy capital to grow in most of the markets that we want to be exposed to,” says Oyetayo. “That trade-off is really what we’re making in real time.”

In this environment, capital strategy and growth strategy can no longer be treated as separate conversations.

“In a capital-constrained world, you should only be deploying capital when it brings growth or you have a return on it,” says Oyetayo. “You have to be extremely thoughtful about what you’re spending, so your capital strategy and your capital and growth strategies go hand in hand.”

The EY CEO Outlook research suggests this is becoming a broader leadership challenge. As growth slows and costs remain elevated, some businesses are being forced to balance short-term efficiency with long-term competitiveness.

Building flexibility into the model

While discipline matters, founders must also retain enough flexibility to act when opportunities arise.

Suri experienced this first-hand when it used debt financing to secure inventory ahead of an unexpected market shock.

“We used debt to buy around six months’ worth of inventory in the US because it enabled us to secure bulk-pricing agreements with our supplier,” says Rushmore.

“When the US tariffs were announced about a week later, it suddenly looked like a very good decision because we had pre-tariff stock on hand.”

The episode illustrates an important point: capital discipline does not mean avoiding risk altogether. It means deploying capital deliberately and with a clear strategic rationale. The same principle can also apply to talent investment.

“The incremental ROI you get from an extremely talented person can sometimes allow you to be flexible with respect to spending,” says Verto’s Oyetayo. “Having the right type of talent deployed into the business is very important in a capital-constrained environment.”

Oyetayo’s sentiments are backed by research from EY, which suggests that resilient organisations possess talent able to prepare for future challenges, respond effectively under pressure and systematically learn from setbacks. In uncertain markets, these characteristics and capabilities can become as important as access to capital itself.

Choosing the right growth partner

As funding markets evolve, founders are also becoming more selective about where capital comes from.

“The choice of capital provider is key,” says Kenward.”Private equity sponsors bring more than just capital; they bring connectivity, expertise, know-how and networks that can help unlock new opportunities. They also provide founders with an opportunity to de-risk some of their personal wealth, which can then enable them to pursue a more ambitious growth strategy with the expertise of their new investor by their side.”

For founders, that means reviewing strategic alignment as carefully as valuation.

“Founders should fully consider how their personal values and long-term vision align with the potential investor before making a final choice,” says Kenward. “Selecting the right partner is key. A good way of doing this is to speak with other companies in the sponsor’s portfolio, including those where performance hasn’t played out as expected.”

Some businesses are also exploring inorganic growth opportunities to accelerate transformation.

According to the EY CEO Outlook, mergers and acquisitions are increasingly being used to access technology, talent and new markets at speed.

The businesses most likely to succeed in the current environment will not necessarily be those with access to the most capital, but those that deploy it with the greatest discipline and clarity of purpose.

Volatility has become a permanent feature of the business environment.

Geopolitical tensions, supply-chain disruption, inflation, regulatory change and rapid advances in AI are creating new challenges for business leaders. Yet for many fast-growing companies, resilience is no longer simply about protecting the downside. Increasingly, it is becoming a source of competitive advantage.

The businesses best positioned to thrive are those building resilience into governance, operations, technology and decision-making from the outset.

The latest EY CEO Outlook highlights sustained transformation as a defining characteristic of organisations successfully navigating uncertainty.

Rather than waiting for conditions to stabilise, leaders are continuing to invest in technology, operating model redesign and strategic transformation to strengthen their long-term position.

For UK construction business Reds10, resilience starts with diversification.

“Five or six years ago, we were heavily exposed to the education market,” says founder and chair Paul Ruddick. “I realised that if this tap turned off, we would be in trouble.”

Today, the business operates across a broader range of sectors, including healthcare, defence, education, nuclear and temporary accommodation.

“It’s all about spreading your risk,” says Ruddick.

The company has also sought greater control over its supply chain, bringing more procurement activity in-house and securing longer-term pricing agreements to reduce exposure to market shocks.

“We buy materials raw at source which can often be subject to price fluctuations when there is global volatility,” he says.

The result is greater visibility, improved planning and a stronger ability to absorb unexpected disruption.

Turning uncertainty into opportunity

While some organisations focus on mitigating risk, others are finding ways to benefit from volatility.

For supply-chain intelligence company Zero100, market uncertainty has accelerated demand for its services.

“Instability can often encourage organisations to invest more in technology so they can be more agile, more flexible and more self-sufficient across their supply chains,” says Zero100 CEO and co-founder Olly Sloboda. “All of that has been a tailwind for the solutions, services and guidance that we offer customers.”

The example highlights an important shift. Historically, resilience was often viewed as a defensive capability. Now, businesses are using resilience to create strategic advantage, enabling them to move faster, adapt quicker and respond more effectively than competitors. This requires leaders to anticipate disruption rather than simply react to it.

“You always need to look 12 months ahead,” says Ruddick. “If you’re worried about what’s going to happen in three months’ time, you probably haven’t done your planning properly.”

As organisations become more proactive in their approach to risk, data is playing a more important role in decision-making. For example, Reds10 has streamlined business and operational data into a single board-level reporting process, helping leadership teams identify emerging risks and opportunities earlier.

“Scale-ups should be embracing technology to better prepare for market, economic and geopolitical disruption before it happens,” says Harvey Lewis, lead analyst for technology in EY Insights. “Tools like AI can extend far beyond dashboards and reporting. Leaders can use AI’s reasoning capabilities to test future scenarios, generate synthetic data and explore the consequences of different decisions.”

Building resilience in the age of AI

Artificial intelligence is rapidly becoming another important tool for business resilience.

“Technology, data and decision intelligence are all increasingly central to how scale-ups build sustainable long-term value,” says EY-Parthenon’s Morris. “The businesses that embed data-led decision-making early are often better equipped to anticipate disruption, deploy capital more effectively and scale with greater confidence. The broader question of risks and opportunities of AI disruption remain at the forefront of due diligence and value creation considerations in any transaction in the current market”

However, according to the recent EY AI Sentiment Index, while three-quarters of respondents have used AI within the last six months, only 14% say they would be comfortable relying on fully autonomous, agent-led systems. The findings highlight a growing reality for businesses – AI adoption may be increasingly important for growth and resilience, but it must be accompanied by effective governance, accountability and human oversight.

For many businesses AI offers an opportunity to improve efficiency, accelerate decision-making and extend organisational capacity.

“AI is enabling smaller teams to scale faster than ever before,” says Carolyn Dawson, CEO of the Tech Nation and Founders Forum Group. “But the wider funding environment means founders have to be more disciplined, resilient and intentional in how they build.”

“Leaders can’t keep pace with every frontier AI model, but they can focus on the fundamentals within their control – data, compute, governance, trust and adoption,” adds Lewis. “Get those foundations right and AI can become a powerful tool for helping scale-ups make better decisions and adapt faster.”

With businesses turning to AI to improve operations and resilience, Zero100 has developed AI-driven workflows that synthesise research, customer insights and proprietary data into a live intelligence hub for employees.

“We’ve replaced weeks of meetings, discussions and Excel schedule reviews with agentic workflows that surface the right insight to the right person at the right moment,” says Sloboda.

The result is faster decision-making and more responsive customer service.

Yet the organisations generating the greatest value from AI are not removing humans from the process. They are redefining where human expertise adds the most value. More than two-thirds of respondents in the EY AI Sentiment Index research said the more they see AI being used, the more they value human expertise and creativity.

“One of the risks with AI is that it reduces the pressure on humans to think critically,” says Sloboda. “Yet critical thinking and judgement are only going to become more important leadership traits.”

By itself, technology cannot create resilient organisations.

“It may seem counterintuitive, but long-term resilience depends as much on people with the right expertise as technology with the right capabilities,” says Lewis. “Businesses need a strong pipeline of talent so professional judgement and institutional knowledge aren’t lost when people leave.”

Research from EY suggests that resilience ultimately depends on an organisation’s people: their ability to adapt under pressure, make effective decisions and maintain momentum through periods of uncertainty. Maintaining those capabilities often requires a different approach to talent.

“As you grow, you tend to need more professionally trained people,” says Ruddick. “When you’re a £200m business, you need people with the right experience, clear responsibilities and the ability to be held accountable.”

The fundamentals of resilience

Many of the fundamentals of growth remain unchanged. Strong governance, robust planning and prudent cash management continue to underpin organisational resilience.

“Don’t sail too close to the wind,” says Ruddick. “One of the biggest reasons businesses fail is because they run out of cash.”

The difference today is that resilience is no longer simply about surviving shocks. It is about how to better lay the foundations and prepare for them – through the right blend of technology, talent and planning.

“Success increasingly depends on how effectively businesses balance investment in people, technology and data with capital management and short-term financial performance,” adds Morris. “Those that invest early in scalable systems, robust data architecture and AI-enabled decision-making are better positioned to adapt as market conditions evolve, enabling them to grow at speed, without compromising long-term value.”

The organisations most likely to succeed over the coming decade will be those that embed resilience into every aspect of how they operate, enabling them not only to withstand disruption, but to adapt, evolve and continue growing through it.