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Growing from a small team to a company with a whole bunch of employees is a difficult but rewarding journey. I had this experience with the last company I built: it began with ten individuals who mostly outsourced services, and then grew into several autonomous teams with diverse expertise. But the journey was not without obstacles.
Many tough decisions (and after all, mistakes) along the way have taught us a lot, so I’d like to share five key insights from my company’s journey that may help aspiring entrepreneurs grow their businesses.
1. Strategy is key
As a startup, we were ambitious, pondering big and expecting rapid growth. We wanted to get busy and jump right into business. This approach definitely had its benefits at the starting: we learned along the way and had many essential lessons.
But over time, it became clear that everybody on the team had different goals and we were all pulling in different directions. We were reacting to current challenges reasonably than working toward long-term goals.
We needed a shared vision. Otherwise, growth wouldn’t be possible.
So we took a step back and focused on developing a strategy that defined our goals and the steps to achieve them. This allowed us to prioritize tasks, allocate resources more effectively, and make sure that each team member was on the same path.
That’s why I recommend here that you just create a clear roadmap for what you are promoting from the very starting. If everyone is working towards one goal, they are more likely to achieve it faster.
2. A brand new team does not mean recent managers
According to the U.S. Bureau of Labor Statistics (BLS) about 20% of latest corporations fail during the first two years of their operation. Fortunately, this was not our case.
Our hands-on approach helped the business grow quickly. But there was a catch: our expertise couldn’t sustain. We couldn’t educate our teams or expand our knowledge fast enough. Because all the team members worked together for a very long time, it was like a blind person leading a blind person.
Reflecting on this experience, I highly recommend hiring qualified senior managers who already have experience to lead the recent business. Of course, you must still invest in your current team, but don’t demand what they do not have; give them time to develop. In the meantime, make sure what you are promoting advantages from experienced leadership.
Hiring highly qualified managers has transformed our company’s operations. They have in a short time identified areas requiring improvement, which has allowed us to cope with the increasing workload. Thanks to them, we have built a solid foundation for sustainable growth.
3. Ideas before data are hypotheses
In our early days, we accepted partnership proposals or began on ideas without doing any internal evaluation. Some projects seemed to have potential, but ultimately many of them didn’t meet our expectations or deliver strong results.
After several similar disappointments, we have learned a easy fact: until the data tells us otherwise, treat every idea as a hypothesis.
That’s when data became our guide. We began to approach decision-making with deep analytics, leveraging competitor data and hiring leaders who could provide priceless insights from their past experiences. Over time, every business move was supported by concrete evidence and strategic insights.
The transition from 10 to 500+ people wouldn’t have been possible without this alteration. If we wanted to grow, we had to recognize projects that did not work out from the start.
4. Stick to your strengths
It might be tempting to expand your startup into multiple areas and directions. However, if not done correctly, diversification can dry up what you are promoting. You should only develop products where you have expertise and proven results.
For years we kept several fully developed products and a team in place despite the indisputable fact that they were unprofitable. We stuck with them and hoped that something would change. But without a real competitive advantage (which we didn’t have) there was no reason to be optimistic.
To validate our ideas, we ran A/B tests using minimal functionality and driving traffic to see the cost per click. Then we analyzed whether to develop the project or close it.
5. Where there is structure, there is responsibility
When we were starting our company, there was no clear division of responsibilities. Roles were loosely defined and we weren’t sure who was responsible for what.
When we had questions about the status of a project, we had to seek the advice of with the entire team, not knowing who had authority. This caused stress for each management and employees.
Over time, it simply became obligatory to implement the structure, but we encountered resistance from employees. However, this was completely normal: according to Oak Engage Change Report37% of employees resist change.
To streamline the process, we held meetings to explain the reasons for the change. The best approach was to explain how each change would profit everyone: What will occur if we implement the change? What will occur if we don’t? Then we initiated general meetings to synchronize the entire company.
As a results of this alteration, employees became less stressed and more focused on their work area. This had a positive impact on their productivity and, consequently, increased revenue.
Growing a small startup into a large company is at all times filled with challenges, uncertainty, and risk. But it will probably be a more enjoyable journey if you’ll be able to learn from the experiences of other entrepreneurs.
Prioritizing strategy over tactical decisions, focusing on strengths and data-backed hypotheses, and supporting expert managers and like-minded employees can allow you to grow your startup quickly but easily. Finding the right balance is key to successful operations and market expansion.