Stages in business growth (Part 1)
Just like children, businesses grow through predictable phases. We start life as baby startups, then progress to raging growth companies, before settling into a more stable “adult” phase. Here’s my version of this story focused primarily on B2B service businesses. See if you see any of your own experiences in it.
Once upon a time, you had an idea. It wasn’t your first idea, you’ve had a lot of business ideas, but this one came at a time when you were feeling particularly frustrated (or desperate) and needed a change. So you started working on your idea, and before you knew it, you were in business for yourself. (Whatever that means!)
Those first few years were hard. There was so much to do and so much to learn! You didn’t get a lot of sleep. There were plenty of folks around to give you advice (most of it terrible, occasionally helpful) and somehow you survived. (Sounds like parenting a newborn doesn’t it?)
In the startup phase, it’s just you. So you are the CEO, the VP of Sales, the bookkeeper, the IT jockey, you water the plants and take out the trash. It’s all on you!
The key thing you need in this phase is to acquire customers; because without customers, you don’t have a business. In the middle of it, you always feel like you are failing, and like you are a fraud. (“Fake it ‘till you make it,” right?) But if you are lucky, work hard, and find a great niche, you get successful enough to start hiring people. Your baby is now a toddler!
Hiring and managing people is a whole new nightmare that I have to learn! I thought I had this thing down and now this! I’m responsible not just for my failure, but now people depend on me too. Surely the answer is more clients, more projects, more sales…
So when clients say, “Do you do…” you say “YES!” And you take on more work. IT’S ALL HAPPENING. The business learns to walk, and then run! Growth comes almost magically as clients bring you more projects and word of mouth starts to kick in, and you are getting referrals.
So to get it all done, you hire a team. At first, you don’t want to spend a lot of money on your new hires, so you find some young, hardworking, flexible people who will do whatever you need them to get done. So they’re all reporting to you, you give them tasks, and when they hit a roadblock, it comes back on your desk. Every day managing the “team” takes up more and more of your time, and you start thinking, “It’s easier to do it myself.” The more business you sell, the more hours you spend at work…
You are still working too hard, but you aren’t as afraid of failing anymore. You’re starting to fear something else.
What if I succeed?
On Saturday we’ll look at what that success might start to look like!