It's Time to Scale

The skills that are required to start a business are not the same that are needed to grow or scale it.

As an entrepreneur in the first stage of enterprise, you multitask heavily. You run product development, strategy, marketing, customer service and even finance. Overheads are relatively low since you do the work of many people.

But, as your organization grows, there's a small window to train middle managers before the knowledge gap between you and your staff becomes too wide to bridge. Doing everything is just not sustainable. Competent hands are required to deliver on core tasks, so you are free to develop new products and markets.

With that in mind, if you are currently transitioning from a start up to a more structured company, here are some things to note.

1. Mentoring alone does not produce managers.

Deliberate training, skills development, standard operating procedures and key performance indices (KPIs) are essential too.

Many entrepreneurs spend years mentoring young staff, but never actually teach them management in a structured manner. There is no training plan or career path. No process documents to follow or clear measurable KPIs. Everything is amorphous.

And so, only your self-motivated employees end up absorbing mentoring and prioritizing their own training, via personal development, books and courses. Some of those staff eventually leave for more structured companies or opportunities.

2. Don't eat your seed before harvest time.

Succeeding companies usually have a time of plenty when a lot of money is being made. This is a golden time to hire the right staff for your core team. If you miss this opportunity and a season of drought comes, you will no longer be able to afford a structure without assistance.

3. You can't be insular.

You must read widely, attend conferences and even join international fellowships. Seek new information related to your business as well as better ways of doing things. You don't know it all and could quickly become outdated in your organizational methods and processes.

4. Capitalize.

If you do not have the internal funds to build a core team or to develop systems, there are options. But first, come to terms with the reality that you can't bootstrap indefinitely. You will hospitalize yourself or your existing team if you try to expand without enough hands.

If your company wishes to remain independent, then you must capitalize with funds from existing directors or from sales. Sara Blakely of Spanx did this until she built a multi-million dollar empire and eventually sold it. The founders of MailChimp did the same.

But, if you don't mind giving away some equity or control, then you can capitalize through debt or venture funding.

However, please don't capitalize haphazardly. Do a detailed plan and budget for what is required in the next one year first, and then select the cheapest source of funds.

5. Don't hesitate to bring in experts.

You can't know what you don't know you should know. Yes, there are things entrepreneurs grasp intuitively or by common sense. But what experts do, whether in operations, finance or legal, is to develop replicable systems and processes that can scale.

Common sense and entrepreneurial spirit are good. Processes are good too. As you grow, you must move beyond doing things by rule of thumb to documented methodologies. This reduces key man risk and empowers the rank and file.

Are you currently thinking of scaling your business? Then I sincerely wish you the best in your efforts.