Getting a startup off the ground is tough enough, but building the company into a medium-sized business is another matter entirely. A more mature skillset is required to make this seemingly gigantic step at the time which, in hindsight, will have seemed easy enough. Yet, few startups ever achieve it and are quickly forgotten after the business fails.
Here are some tips on how to scale from a startup to a mid-sized business that’s built to survive.
You Are Your People
The sooner you realize that every hire is critical to their business, the better. Unlike large companies with hundreds or thousands of employees where a few bad hires won’t make a difference to performance, this isn’t the same for startups.
A few bad hires can make it harder for smaller companies to succeed. The culture and morale can suffer badly with one or two bad eggs. This is difficult to overcome once it sets in.
Take the perspective that you are your people. With the intention to grow the business, use HR staffing to find excellent human resource professionals that can support the company’s growth, including the staffing roster. Also, bear in mind that staff requires greater support as the expansion continues with more personnel issues, not fewer, as a result.
Nurture Funding & Investment Sources
Many newer businesses struggle for enough working capital to manage the business and have enough left to invest in personnel, technology, equipment, and other necessary items for expansion.
Look as widely as possible for different sources of funding when you’re open to taking on business debt or a silent partner. Business loans and other debt funding is more commonly available to companies that have a reasonable history of trade. However, there are specific business loans for different purposes such as necessary equipment or for expansion that may be worth exploring.
To find new investors for the business, angel investors or venture capital may be suitable. There’s also crowdfunding which provides a way for multiple investors to pool their resources into several businesses to reduce their risks. Some require product prototypes to raise money towards their development, but it depends on the website.
Develop the Management Team
The reality in the U.S. is that over half of small businesses never have any employees or make significant, consistent profits. Business owners that stay small, hold onto the reins of the business too long, and won’t develop a management team to support its growth risk it all.
In your case, while you may believe that you can handle everything, as the size of the business expands with new departments established and higher-level decisions made more regularly, it’s possible to get quickly overwhelmed.
Actively looking for employees who can remove part of the day-to-day managerial burden, frees you up to manage business expansion. Some staff can be trained and promoted into more senior positions to facilitate that if that makes sense too.
Scaling up a business in its formative years is tough. Not many founders succeed when trying to do so. Therefore, it must be approached with care and diligence to get it right.
