The traditional growth strategies of organic expansion and acquisition require businesses to make up-front investments in additional assets. The need to own physical assets like factories and machinery or intangible ones like information and skills, makes traditional growth strategies risky, due to uncertainty in returns. The pursuit of growth through asset building can also cause a lowering of margins, hitting profitability of the firm.

In contrast, a leveraged growth strategy does not require companies to trade profitability for growth. Instead of owning assets, a company can leverage the assets of other businesses operating at many levels of the value chain, and capture value for itself as a knowledge broker. If, the needed assets exist within other companies, and a firm can mobilize them to support its own growth initiatives, it can capture the economic benefits of growth while avoiding the economic burdens of asset ownership. This strategy involves substantially less risk and offers the potential of an immediate and sustainable boost not only in sales but also in profitability.

For example, a successful manufacturer of home appliances, spotting an opportunity to market new high-end products using recent innovations in technology, would traditionally try to capitalize on the opportunity by hiring a new engineering and design group with the appropriate technical skills, or buyout a manufacturer of such appliances. Using a leveraged growth strategy, however, it would find independent home-product designers and encourage them to work with contract engineering groups to develop innovative designs. It would also develop relationships with various manufacturers specializing in different stages of the production process and use them to actually make the products. Its role would be to manage the process network and facilitate the collaboration of these three groups of companies. They would go alongwith the arrangement because the firm's broad distribution, sales, and marketing capabilities would speed the new line's acceptance in the market. Tapping into others' assets rather than either building or buying its own, would reduce its financial risk, and it can break into markets more quickly, and stay responsive to future technological and market shifts.

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