Terry Rachwalski: Management consultant, Front Porch Perspectives
Regardless of the type of startup, next-level strategy requires questioning, reviewing and taking action on your business model, money and team.
•Are my business model and product relevant?
Startup products often morph into unanticipated incarnations. Unhooking from the original concept and adapting to what the market has told you could mean tweaking your business model or product. You have to sell your value to a larger market and either branch out from or expand your base. This requires assessing product features, communications and your operations. People buy what they perceive to be of value; ask who is buying, what they are paying for and how they want to receive it.
•Do I have enough money?
Most startups fail because they run out of money – period. You can’t run out of runway before the plane takes off. Scary burn rates need an immediate course correction, not loyalty to a business plan. What can you change and what will make a difference? Can you get to market quicker with a less complex product? How can you leverage and integrate PR, social media, partnerships and advertising? Do you have an operational and customer service plan for success and growth?
•Do I have the right team?
Startup skills are not the same as what it takes to build a business or manage one in steady state operation. To get to the next level, be honest about the skill sets that are required. This includes a self assessment about the role you should play.
Boris Wertz: Founding partner, Version One Ventures
The most important piece of advice I could give any startup founder is to work on the business, not in the business.
With early-stage companies, there are countless things that need to get done on any given day and precious few resources.
Many founders get stuck in the trap of the daily grind: they’re putting out fires, problem solving in R&D, looking at the marketing budget, dealing with customer issues, finding the best vendor for x, y and z.
These are all important tasks, but they’re reactive. And when the founders are putting too much of their attention on the daily tasks, no one is setting the vision, strategy and steps to take the company to the next level. Reactive companies only go so far.
This is why it’s critical for startup founders to surround themselves with a great team, which brings me to my second piece of advice: people make the difference.
It’s true that a company built on an average idea and top team can execute far better than a company with a great idea and an average team.
Founders should take a look at their current employees and how they work as a team.
What holes need to be filled? Where do you need to add more expertise?
In many cases, you can determine this by seeing which day-to-day business functions most demand your attention.
Then you’re going to want to hire specifically for that experience, skill set, personality trait, etc.
Rab Kooner: Business analyst, Small Business BC
At Small Business BC we commonly see entrepreneurs who have been in business for a couple of years and feel they’re ready to take their company to the next level. These business owners often face a number of challenges – such as feeling overwhelmed by the roles and responsibilities they’ve taken on, having difficulty with financial management, being undercapitalized and facing trouble increasing production to meet a growing demand.
Before you start hiring employees and initiating expensive marketing plans, this is the perfect time to revisit and revise your business plan. You’ll need to develop a strategy to not only build your company but also to manage that growth. Growing too quickly without being prepared can kill a business just as quickly as having no customers at all.
We also encourage all business owners to hire expert help; as your business grows you’ll no longer be able to juggle all of the responsibilities as you previously did. Assemble a team of expert advisers – lawyer, accountant, banker etc. – to support you as you put your growth plan into play. An accountant can offer you a business valuation, while a banker can help you work out solutions for cash flow, such as a bridging loan or a business line of credit.
My final piece of advice is to take the time and make the investment to implement systems to increase efficiencies. Whether it’s installing project management software or providing staff training on new technologies, as your business grows you’ll want it to run like a fine-tuned machine.