You’ve survived the early days! Your company is becoming increasingly focused and understands its market position and offerings.
As a leader, you feel confidant and even arrogant now that you’ve been able to prove the sustainability of the company. You are passionate and driven. There is an evangelical side to your belief in your product or service. As a leader, you have built self-knowledge and have started to reach out to improve your external network. A formal advisory group is in the works, if not already established.
Many of the entrepreneurial characteristics you exhibited in your early days are still in evidence, although tempered by learning and experience. You’ve had to move from dreamer to doer. The key focus for you and the company is building out the go-to-market systems and processes.
The business still reflects your personality and style. You are bringing in new people as the company grows; it feels much like a family. The hours are still long, but there is a feeling that the work is contributing to a higher purpose, so somehow the hours don’t seem so bad. Communication is still informal and people still wear many functional hats. Most gravitate to the tasks they enjoy most. There aren’t many formal job specifications; many business processes are rudimentary.
From a customer standpoint, order patterns are becoming established. Unlike in the early days, you have moved beyond having a few customers represent the bulk of your business. Unfortunately, this comes with a loss of customer intimacy. The upside is that you are becoming increasingly objective about the type of customer you’d like to have. You have established some forecasting and fulfillment systems and are starting to create manufacturing standards and to focus on streamlining production.
Cash is still king. Although you are beyond living from cheque to cheque, your working capital needs are high and surprises can still happen. Because of that, you are developing more detailed forecasts and financial and cash flow plans. Expanding your market knowledge, customer profitability, lead generation and sales systems is critical. Key functional competence centres on sales, manufacturing and finance.
Survival is by no means simple at this stage. Many of the issues lie with the founders themselves. Founders can become decision bottlenecks, requiring that all decisions move through them, crippling the company. Conflicts among founders can turn toxic. Arrogance, born of success, can cause over-confidence or missteps in planning. Planning on miracles, betting the farm on long-shot ideas and loss of key employees are but a few problems associated with founder syndrome.
Growth itself is one of the key issues you must deal with. Grow too fast and the business processes and cash can’t keep up. The problem with growing too slowly should be self-evident.
Employee turnover, loss of key experts, new hires poisoning the culture, environmental changes, system flaws and premature processes are but a few examples of problems that can kill a business at this stage.