Most entrepreneurs and small business owners – at some point – dream of the time when this thing they are creating will give them freedom. Financial freedom and the freedom to fulfil the rest of their dreams.
The sad reality is that so few do it. In fact, the figures tell us that only 4% of start-up businesses make it to ten years. 4% last ten years. The rest fall by the wayside. That’s a 96% failure rate – which is horrifying.
So why is this happening?
I believe there are three essential stages in a business – or one that will give the owner, the founder, what they want.
Those stages are Start-up, Sustainable and Scalable.
And here is the conundrum – the ones who really want to grow, try to go from Start-up to Scalable – without going through the Sustainable phase. It’s like trying to run before you can toddle.
Most businesses are started by someone who is really good at what they do. The accountant who goes out and starts their own practice, the brilliant coach who knows they can make a difference; the public relations consultant who decides to go it alone.
The thing is – you can be the best practitioner in your field and still have a lousy business. To have a great business, you need to understand the difference between having a job and running a business.
A sustainable business doesn’t depend on its owner to do what it has to do well. It should be able to operate just as well when you’re away as it does when you’re present. If your business depends on you, all it does is place huge pressure on you and teaches your clients to be totally reliant on you, rather than on the business and the great staff you may or may not have.
I have seen businesses that have been going for 15 and 20 years, and yet I would define them as still in Start-up – because they are still dependent on the owner to work.
The real Start-up phase is about getting clear about where the business needs to go, who its market is, the services and products it will provide to that market, how it will differentiate itself and stand apart from its competition, the values it stands for and the timing and financial milestones it will need to meet. And this is where decisions are made about the resources – people, finance and systems – that will be necessary to make that happen.
All of that has to happen in Start-up. Getting all of those things in place will be moving the business towards the Sustainable phase. And once they are in place, the business can then move into the Scalable Phase.
The Scalable phase is where you can expand or replicate your business. Open another branch. Buy a similar business and apply your systems and principles. Replace yourself.
And you simply can’t do that without first making your business Sustainable.
Which stage is your business in right now? Start-up? Sustainable? Or Scalable? Where do you want it to be and by when?
Until next time…
P.S. Learn more about working ON your business with my FREE eBook! Get it HERE!