Datapath manages networks, servers, and cloud services for organizations. They’re also a managed security service provider, which entails overseeing cybersecurity for companies and “keeping the bad guys out.”

CEO and co-founder David Darmstandler started the tech company with his longtime friend (and now president of operations) James Bates in 2005. And within the last few years, they went from almost 30 employees to nearly 60. So we invited David on the Fastest Growing Companies podcast to talk about their explosive growth.

According to David, it came down to revamping their business and having a team focused on being better every day — whether that meant taking a risk, revising a process, or improving their company from the inside out.

Here’s what he means:

Refining client base to propel growth

About seven years ago, David and James decided to refocus on their client base and refine it so they could laser in on their team’s expertise and focus on a specific niche in their industry.

“We were kind of like a funnel [in the beginning] where we’d just take anything,” David explained. “But we realized we were doing the customer and our team members a disservice by not having a level of focus and expertise.”

Instead of serving everyone, Datapath focused on helping fast-growing companies and public school districts in a 50/50 split. The refocus created more repeatability in what they offer and how they execute. And that meant more profitability (thanks to efficiency) and more referability (thanks to their niche).

“We have a much better chance of propelling growth by having industry focus and expertise than throwing a wide net and being an expert in everything.”
<blockquoteauthor>David Darmstandler, CEO and co-founder at Datapath<blockquoteauthor>

If you want to scale your SMB quickly, consider looking at your client base. And if you have many types of customers, find a way to refocus and laser in on who you serve best. Because when you’re part of a niche, you strengthen your own offerings (with expertise) and potential for referrals (with an audience).

Revising based on feedback

According to David, there is nothing more important than reflecting on ways to improve your company. “You can get halfway down the trail and forget why you’re even there, why you’re doing those things, and why it even matters,” David explained.

That’s why they believe in listening to client feedback for constructive criticism. They try to conduct these meetings at least once a quarter and ask clients, “What are we doing that’s working and what totally sucks?”

David says they also track their net promoter score (or NPS) to collect customer feedback. NPS measures how customers perceive an experience with a brand. They typically arrive as a one-question survey and ask buyers to score company interactions from -100 to +100 (the higher the number, the better).

Then, David and his team respond to the feedback by improving their offerings and making processes more efficient. Which helps the company grow bigger and better.

“We remain humble and don’t think we know everything. And we listen to both our team members and our customers.”

In addition to customers, Datapath also sits down with their employees to obtain feedback and discuss where they can grow. “We’re constantly developing each of our team members,” David shared. “It’s about putting processes into place to mentor and career path people, so they can get to where they’re most passionate.”

Listen to your own customers and employees. And when you get constructive feedback, use it to improve everything you do at your company. Then, be sure to update the knowledge in your documentation so your team is always aware of any changes.

Reinforce culture and relinquish perfection

David talks a lot about the importance of culture and values. And how critical it is to hire employees who culturally line up. “My partner and I still interview everybody to make sure they’re in it for the long haul and gel well with a risk culture,” David explained.

At Datapath, if you’re not blowing it, you’re playing it too safe. Which means they need risk-tolerant people. That’s why they hire employees with “a little rub.” AKA, people who are willing to take risks and go outside the box. That's how they maintain a culture of intentional change and constant improvement.

“If [your employees] aren’t blowing it, it means [they’re] not really trying or not attempting something difficult. They’re just staying safe, and we don’t want that.”

David also believes that when you let mistakes happen, you let growth happen. Because it means you’re letting go of responsibility and delegating the work to someone else instead. And despite any missteps, chances are good that you’ll find a more efficient method (and maybe even more revenue).

“[When] leaders struggle to let go of [perfecton], it keeps them from expanding and growing,” David said. “And it’s impossible if [your employees aren’t] blowing it.” In other words, set the expectation that it’s okay to mess up. And recognize that it’s key to delegation and training.

Reconnect to take care of your team 

Like most businesses, David said they faced some major challenges during the early onset of the pandemic. But instead of feeling frustrated, they believed “it was their time” to step up and take care of employees, clients, and the communities around them.

“We bought thousands of dollars in gift certificates from local restaurants, so our team could go get dinner for their family [with the certificates],” David shared. And he said it’s just one example of how they tried to give back during the beginning of the pandemic.

Plus, now that they’ve transitioned to a hybrid model, David is keen on keeping team members connected. So they have regular check-ins as teams via Zoom every morning. And he keeps a spreadsheet that tracks the last one-on-one time he had with each team member.

“Morning check-ins are great from a tactical standpoint, but we have separate meetings about whatever you want to talk about,” David shared. Even if it's just 15 or 20 minutes, it’s about having a regular cadence and asking how employees are doing outside of work.

“You don’t have to talk about work [with employees]. It’s just about connection.”

In other words, a scaling organization takes care of its team (and their needs) by ensuring leadership is providing a positive employee experience and creating a work environment where team members show up because they feel supported.

Scaling companies need to continually improve their operations. It's not enough to set up shop and rest on your laurels. Instead, remain curious, listen to feedback, and never stop iterating and improving.