Flywheel

What is a Flywheel?

The flywheel is a concept that describes a self-reinforcing loop that drives momentum and growth for a business. The idea is that once momentum is built, it can continue to accelerate and compound over time. For startups, the flywheel effect occurs when small wins and improvements contribute to larger growth cycles, creating a sustainable growth engine.

Components of a Successful Flywheel

  • Customer Acquisition: Bringing in new customers fuels growth.
  • Customer Retention: Retaining customers increases lifetime value and reduces churn.
  • Reinvestment: Profits are reinvested in the business to continue driving growth.

Related Terms and Concepts

Growth engine, momentum, scaling, customer retention