Planning for growth when you first start up is a lot like starting a savings account for a newborn. It seems premature, but it’s an absolute necessity.
A few short years ago the company I work for was not much more than four twentysomethings working out of an apartment with the seemingly simple mission of building better websites. Today, less than a decade later, that rag-tag team has grown to more than 150, with offices in three countries and a client roster that includes the NFL and the United Nations, among many others.
It’s been a pretty impressive run, especially considering that many startups fail within the first few years of operation. In retrospect, I credit early planning with setting us up on a path for growth. In other words, our team didn’t fail because business was always conducted with an eye toward the future, and the realization that clients today don’t always mean clients tomorrow.
Here are four tips for making growth part of your startup’s DNA:
1. Say ‘yes’ to success.
In many older companies, bureaucracy dictates that if a business proposal doesn’t have a guarantee of success reinforced with a five-year projection, it should be put aside until it does. This type of thinking is counterproductive for a budding entrepreneur. Your business needs to grow and it needs to grow fast.
To avoid this business blunder, concentrate on removing obstacles instead of erecting them. Stop saying “here’s my concern” and start saying “here’s what we need to do to make that happen.” The worst thing an entrepreneur can do is stop someone from doing something by saying, “No, period.” But if you must, help find an alternative solution.
2. Don’t discount opportunity costs.
More than taxes, health insurance or rent, it is the projects you aren’t launching and the deals you aren’t making that threaten the economic stability your business. The notion of opportunity cost plays a crucial part in ensuring that scarce resources like time and money are used efficiently.
For this reason, you’ll always want to consider other ways to gain market share or build your business. As yourself the question: What should we be doing? Then, let that guide future avenues for growth.
3. Identify and build your customer base.
Cultivating your business isn’t merely one item to be ticked off on a long check list. It’s imperative for the long-term success of your business. Often entrepreneurs come up short because they haven’t properly identified their target audience. If you don’t know who you customers are, you’re going to have a hard time reaching them.
To become better acquainted with your customers, try this exercise: Assemble a list of each of your products/services and identify the benefit of each one. Once you do that, you should ask yourself: Who would gain from these benefits? There’s your market.
4. Analyze your successes and failures.
Think of failure — a lost deal, a missed shipment, a bad hire — as an opportunity to begin again, only this time more wisely. Missing an opportunity to measure a mistake will ultimately cost you down the road. There is much to learn from our failures, and considerable success will come from examining why something didn’t work.
Now it’s true that most people are aware of this conventional wisdom. But so many young entrepreneurs go about examining failures in the wrong way. Studying failure isn’t about finding fault and assessing blame. Remember that the exercise is to see where a wrong turn was made and learn how to straighten out.
What other growth tactics would you suggest startups consider? Let us know in the comments section.