By: Keith Krach
Every entrepreneur wants to launch a business and see it grow by leaps and bounds. Part of the dream of developing a new product or service is to envision it conquering the market and spreading like wildfire. Good business plans can help set the stage for growth — whether lightning-fast or slow and steady.
Entrepreneurs should remember that successful upward scaling is not accomplished with a single, fixed approach. Goals and strategies must be revisited and realigned as the company expands.
One helpful way to think about the growth trajectory of a business is to start with two numbers: 1,000 and 1,000,000. Reaching 1,000 customers is the first tier of growth, while topping 1,000,000 is the second; each phase calls for a different approach in strategy, leadership, and operations. Consider the following suggestions for working toward these milestones.
1. Set the bar high.
Starting out with confidence in your product and business model is necessary, and an even better practice is to express that confidence in measurable targets. Entrepreneurs should set aggressive goals and then devise a plan for reaching them accordingly. Don’t be afraid to aim high. For instance, if gaining 1,000 customers in the first year or two seems reasonable, why not aim and work for 10,000?
2. Simplify for the customer.
In the early stages of growth, the value of positive word-of-mouth cannot be underestimated. Startup leaders should strive to present the simplest version of their business to customers, so they can easily understand the brand and help spread the word. Another benefit of this approach is that it helps establish a sense of predictability, such that customers develop a foundation in terms of what to expect from their experience with your company.
3. Scale the offerings first.
One approach to scaling that has become more prominent as a result of the digital revolution is to grow the product or service before doing the same with the company. A startup can often support more customers without increasing headcount by leveraging digital platforms, engaging users, and making it easy for partners to build on the platforms. After the customer growth takes off, the company can then support this by hiring more people.
4. Find the best people.
A key component in the growth of any organization is its people, and entrepreneurs who want their businesses to grow should invest accordingly. This might include supporting the professional growth of key talent, so that their improvement also benefits the company. An additional factor to consider is that many companies have found that low turnover rates contribute to sustainable expansion.
5. Invest in a strong personal profile.
The evolving business landscape has introduced an era in which entrepreneurs find success by not only building up a company brand, but also a personal, public profile. Behind this concept is the idea that consumers increasingly want to feel like they are doing business with people, not with an impersonal, amorphous organization. At the absolute minimum, entrepreneurs should provide a detailed personal biography on their company’s website.
6. Separate work for the company and work on the company.
On any given day, the to-do list for startup leaders can feature just about anything, which makes it difficult to know what mindset to be in and when. Scaling a business upward requires entrepreneurs to understand the difference between working for their companies and working on them. For instance, daily tasks like attending meetings with managers are important, but time should also be carved out for thinking about the company’s longer-term growth.
7. Create a playbook.
In the process of reaching the 1,000-customer mark, entrepreneurs should observe and record what works and then develop that data into a “playbook” of sorts. Having one of these on hand is particularly helpful for those businesses that grow by adding new physical locations or entering new markets. When a new outlet opens in a different region, for example, the employees there can implement the playbook to bring business up to speed.
8. Market accordingly.
When thinking about the various tiers of expansion, one of the most important considerations is marketing. During the early stages of growth, a startup typically depends heavily on word-of-mouth referrals and basic digital marketing. Between the first thousand and 1 million customers, entrepreneurs should leverage the power of social media and other digital tools to target specific demographics. Passing that 1 million milestone typically demands the use of mass marketing campaigns, such as television advertising. The decision to move from one approach to another is among the most important that a startup leader and their team can make.