Scaling a business is not for everyone. But, if you want to get to a different level and grow your business, it is generally best to prepare. Don’t get me wrong. I understand the “Ready, Fire, Aim” approach works for some. Technology has made it easier for anyone to get into business. The term “solopreneur” comes to mind when applying the “Ready, Fire, Aim” principle to starting a business. Anyone, literally anyone, can stand up a business in minutes . . . and this is not a negative thing. This provides a great opportunity for individuals and teams to create and rollout business ideas.
Even so, scaling a business should be more tactical. According to an article on miriam-webstesr.com, scaling a business is ““to grow or expand in a proportional and usually profitable way,” which was explained in an October 30, 2006 New Yorker article by Connie Bruck. The phrase “usually profitable” stands out, which implies that profitability does not always follow scaling in business. In order to be profitable, the appropriate steps are necessary. Below are some key points to consider when scaling a business.
- Make a Plan: As with most things in life, a little planning can go a long way. Planning includes manning things. Infrastructure comes to mind initially. A business of any size that is looking to scale must consider marketing, financial components, business processes, and product or servicing offerings. Another consideration should be given to marketing. Without a plan, most endeavors in life fail. This applies to scaling a business as much as anything.
- Secure Funding/Financial Support: Private equity, venture capital, traditional financing (debt), and “friends and family” are options that should be considered. A business plan is key in securing financial support, which is available in many ways. A business plan or concise “Pitch Deck” will also help develop an idea of how much investment is needed or an appropriate size of the loan. Additionally, the plan will help focus in on how to allocate the funds once received.
- Find the right partners: An entrepreneur, much less a solopreneur, cannot do everything by him or herself. Strategic partnerships should be developed in order to meet growth and scaling. Business development, marketing, procurement and accounting partners are in abundance in the fractional economy. The right partnership, with individuals or firms, can make or break any scaling plans. A diverse mix of relationships, including those with the right mindset is key in prepare to scale a business.
- Set Targets: Creating goals are equally important for business scaling. Cost goals, staff goals and sales goals (even “culture” goals/see above) will affect the short-term and long-term efforts to achieve scale. Make sure that the goals are attainable and measurable. Key metrics should be developed for each category and the right tools should be selected to measure progress. Goals can help a business achieve success at the right pace, preventing scaling at an unsustainable level. While expansion may be the ultimate goal, over-expansion, or expanding too rapidly could lead to disaster. Targets will help pace the growth.
- Monitor Progress: Now that the goals and targets have been developed, make sure to monitor them at regular intervals. Monthly, Quarterly and even Weekly progress reports are key in sustainable business scaling. An abundance of tools exist now that will assist entrepreneurs and solopreneurs in their scaling efforts. Make sure the right products are selected to measure the progress. Monitoring progress will not eliminate all issues, but it does flip the script and helps focus on the positive achievements. Monitoring is also useful in identifying issues as they develop and effectively resolving them.
These key items should be considered when scaling a business. However, other things should be considered, too. Another key item that comes to mind is “culture”, and we will discuss developing culture at another time. Scaling a business can also lead to failure if not handled correctly. It is okay to take you time and ask the right questions before scaling. Look for your competitive edge, define your value proposition and develop an effective plan to implement.
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