Every entrepreneur who starts their business is going to inevitably deal with the problem of growing, or scaling, their business. The problem is that this term is horribly vague and undefined at its root, if you really look at it.
What does it mean to grow your business? The answers vary from person to person, specifically to help entrepreneurs and businesses through growth, scaling, and similar situations.
One of the most important things to remember about scaling your business, is that it’s not a guarantee. Rather, you have to explicitly build a plan of attack to ensure you grow profitably.
Anybody can expand a business and hire more employees, which could technically be considered growing or scaling. However, not as many entrepreneurs and businesses can successfully scale so they remain profitable on their top lines throughout the entire process and beyond.
You have to implement repeatable processes for your growth, and their experts can assess your current strategy and help you implement new processes, models, and infrastructure to ensure you grow successfully and profitably. When these web-based businesses initially launch, their policies work well for a small startup. But as they experience double and triple digit growth, they face enormous operational challenges that require changes in their technology infrastructure and accounting policies that better reflect their growing business need. It all hinges on the question of what can be changed to make your current model more efficient.
That’s because the constantly expanding and shifting global economy provides a lot of opportunity for these web based businesses to continue to grow at exponential rates. The key to their success, though, is in their ability to adapt their companies from small businesses to large self-sustained and profitable global companies. Some of these companies are growing so fast, and they’re excited, but when you’re building that fast and revenue comes in that quickly sometimes you end up losing money on back end.
Scaling for profitability becomes even more important when you consider the impact it could have on potential investments. What happens when your current infrastructure fails to predict the future accurately?
You’re expecting to collect similar revenue the following month only to find to your dismay that customers have left and there is no predictable revenue. You’re unable to charge the same amount of people, and now you’re top line has come down.
Plus, you can’t fundraise your way out of a financial loss. Sure, you can try, but it’s a hard truth to face when your investors ask to see your plan to generate sustainable revenue over the next five to ten years.
The answer to all of this is simple: implement models, infrastructure, and processes to ensure this doesn’t happen with any type of business.