column: Setting the stage for second stage: Tips from entrepreneurs
Congratulations! You’re an entrepreneur that’s made it past the startup stage with your business and are headed toward second stage.
I like to call businesses that are in this sweet spot, first stage—not quite a startup, but not quite ready for second stage. First stage is between what I affectionately call the “I will survive” stage to the “I made it” stage.
So, if your business is focused on growth and aspires to reach second stage, how do you prepare? Here’s what several local entrepreneurs had to share.
1. Share and share alike
At some point you will realize that as the leader of your company you can’t do it all. You’ve hired employees for project-based work, but what about all of the broader tasks including a receptionist, marketing, office management, and human resources?
Megan Torrance of Torrance Learning recommends that you consider sharing a staff member with another company. Torrance advises, “Between 5 and 25 employees, there are several points in which you need a dedicated specialist for some “overhead” type of role, but you can’t afford a person and you don’t need a full time one anyway.”
Torrance shares a marketing, sales, and graphic design staffer with another company and it’s been a real lifesaver.
2. Be flexible—very flexible
Remember how flexible you needed to be during startup stage? You adjusted your marketing and sales approach, your products or services, and pricing strategy. During second stage that flexibility will be put to the test.
Merrill Guerra of RealKidz has this advice: “I think the biggest thing that has helped me to survive is constantly evaluating our strategy and adjusting as needed. Almost no company looks like it was originally envisioned in terms of business model and while it is hard (and painful) to admit a strategy you’ve sunk your whole existence to isn’t working, it’s vital to make that realization and then switch strategies to one that will work.”
3. Keep your friends close Sure you’re in first stage right now, but so were a lot of other businesses that have graduated to second stage. Join groups and find mentors who are willing to let you ask the difficult questions. You’ll get your chance to give back when you become a second stager yourself.
Marisa Smith of the Whole Brain Group recommends that you “find people who have already “been there & done that”—people who can provide mentorship and advice while not being so far removed from your growth stage that they can't remember what it's like.”
4. Be ready to change your role—or not
As you transition from first stage to second, you’ll need to take a good look at your own role in your business. It may be time for you to shift from sales back into providing mentoring and visioning for your employees.
Charlie Penner, regional director of the MI-SBTDC, recommends that you “envision what it will look like as you grow into a second stage company. What will your role be? Sometimes people assume that they’ll keep doing the same things.” Think about how other people might have your role, and other key people might also be shifting around. You might need to outsource some activities, or bring them back in-house.
“Your growth gives you the opportunity to think about which part of the business you like doing best. And remember it’s OK to keep doing that piece.”
So whether you’re a startup, in first stage, or headed toward second stage, keep these tips in mind. Think big, and good luck!