How To Scale a Startup Quickly
With emerging trends across global industries, small businesses are rapidly transforming into vital cogs of every economy. In the United States, for instance, it has been reported that small businesses are responsible for generating about 44% of the country's economic activity, they are at the core of the country's economic growth, and provide roughly two-thirds of net new jobs in the labor market.
However, with the number of small businesses that have sprung up in recent times, one concept that must be diligently looked into, is how to scale your business to become an industry leader.
The Difference Between Scaling and Growing a Business
The concept of scaling a business is often interchanged with growing a business, which often leads to the general misconception that, once a company experiences massive growth within a certain period, such a company has scaled. This is not entirely true. A company grows when it sees a consistent return on invested resources. On the other hand, a company scales by raking in revenue with no considerable splurge in resources.
The reality of things is much different. Growing exponentially —in terms of revenue and size— without a feasible plan to scale makes the company vulnerable to setbacks. This is because scaling the company allows you to provide certain foundational operations that provide a skeletal framework for your company to grow.
This article, therefore, highlights the various steps to take when attempting to scale your business quickly.
5 Tips to Help You Scale Quickly
1. Know Your Purpose
First of all, if you cannot answer the "why" of your business, your business is more than likely to fail. As a business owner, you need to understand the relevance of your company within the economic sphere of your locale. This helps to, amongst other things, communicate successfully with your team.
Effective communication will enable your employees to understand your values, mission, and vision, and align such values with their own. This will in turn lead to employee loyalty— and they’ll consistently put the brand out there. Throw in top-notch services and excellent customer relations into the mix, you’re on your way to long-lasting customer loyalty which is an important ingredient to scaling quickly.
2. Develop A Business Map
Many entrepreneurs have business plans, but few business owners have a business map. A business map helps in effectively communicating how a company is to meet specific goals that’ll enable it to scale. It helps to ask specific, integral questions such as: what's next for my business? How should the company fare after a certain period?
Having a business map puts things into perspective for your business, providing you with a reference as you work towards scaling your business.
3. Establish Your Team
Another important factor to scaling your business is hiring the right set of people. This helps in effectively managing the various aspects of your business. It's not just about building a team, it's about building a great one. Your team should have skill sets that cater to various aspects of the company.
Additionally, your "team" doesn't necessarily mean only your employees only. This includes your external relationships, your partners, suppliers and distributors, and even other organizations or teams that work towards the overall growth and success of the company.
In the early stages it can be difficult to juggle filling a talent pipeline, sorting through candidates, scheduling interviews, and doing the admin work new hires require. Often, hiring an outsourced talent agency or contracting to bring in a recruitment agency in house (acting as a dedicated consultant/talent acquisition lead/recruiting manager to help make multiple hires) can help streamline this process.
The two methods, either paying a commission for candidates hired or paying a monthly fee for recruiting work, are the most commonly used today but can also vary in price depending on the salary level and number of hires you’re looking to make.
In general, you can expect to pay a 20% commission for candidates brought in from an agency, or $10,000 to $15,000/mo for a dedicated recruiter that works alongside your team. Occasionally agencies can also use a split fee structure for dedicated recruiters, using both a monthly fee and a lower percentage commission to lower costs for the client.
4. Perfect your product or service
Most business owners are so focused on the growth of the company, that they sometimes abandon the nitty-gritty of the company —the product or service itself.
When you create a product of excellence, scaling becomes easier. However, excellent products can only be created when you spend time improving and listening to feedback, improving your offerings, and finally meeting the expectations of your customers.
5. Learn To Know When To Delegate
Finally, after you have surrounded yourself with the right people, you must learn to delegate tasks to them. This signifies trust and enables you to attend to other important assignments. It is a very important part of scaling a business.
Your business should be able to thrive even in your absence. Also, division of labor within an organization is a very good way of assessing the strengths and weaknesses of your employees.
Scaling your business is a process and cannot be rushed. As a rule, your business has to grow before it can scale. However, you shouldn’t put all your focus on revenue and "growing" quickly. The challenge with such a notion is that it eliminates the importance of linear growth that every company needs, and negates the period where the bulk of building a successful company lies.