Its fantastic that this week see’s a whole raft of activity being rolled out to celebrate and promote starting and growing a business as a series career option. As one graduate said to me the other week –
“I couldn’t find a job so I created my own”
– a fantastic mindset that hopefully will continue to build the UK as the start up capital of Europe. With record numbers of start up’s this year, we should be turning our attention to creating long term sustainable businesses which have the capability, capacity and ambition to scale. These are the job creators of tomorrow. Scaling up a company is a massive challenge for any entrepreneur – its takes business acumen, courage, and lots of emotional intelligence – not forgetting energy. Scaling up a business to employ in my experience requires:
- A mindset that is far greater than merely self-employment. There has to be an underpinning ambition to create a business model that involves a team of people fulfilling different roles. All too often people who set up in business merely want to ‘eat what they kill’. The pain of employing others is commonplace – not everyone wants the hassle that goes with creating jobs.
- A clear picture of what the next 3-5 years is going to look like, supported by a clear plan of what resources are going to be needed – finance, office space, people skills, IT and supporting functions.
- Understand the available funding options and use of trusted advice which ensures both the business case and model can withstand scrutiny from a third party debt or equity funder.
- Strong leadership and an ability of the founder to develop both his/herself as well as the team on the top table. Recruiting and retaining high calibre staff is probably one of the most frustrating challenges for any ambitious founder.
- Strongly connected networks of trusted advisers who can help the entrepreneur make the transitions points of growth. This usually involves funders, legal, IT, recruitment, strategic and tactical finance people, marketing etc. NED’s play an important role in opening up ‘connected network’.
- Great housekeeping comes with growth, this means strong governance, great management information, KPI’s – all coming together and reported on a regular board meetings. So many businesses fail to see the benefit of board meetings – as you grow ignore them and you are destined to lose the grip on business performance.
Setting up a business is not for everyone, those not willing to embrace a life of uncertainty should go and get a salaried job. Growing a business is equally not everyone’s cup of tea – hopefully, Global Entrepreneurship Week will get many to give it a second thought.
People often ask what are the essential ingredients to growing a successful business. Cliché’s such as ‘Think Big’, ‘Anything is Possible’ and ‘Dare to Dream’ often roll off the tongue of young entrepreneurs and aspiring new business start up’s. Regularly found in self-help and motivational books, these terms offer a great source of encouragement to the next generation of business men and women – they have a critical place in the growth journey. As a great believer that mindset is critical to success, what underpins real growth of both a business and individuals is deep-rooted ambition.
Successful businesses, communities and ultimately – economies are built on individuals who have this hard-wired ambition. One of my frustrations is that I visit many truly outstanding businesses with growth potential, but what’s holding them back is very often the lack of ambition. In equal amounts I hear the rhetoric of entrepreneurs who talk a good game about what they are going to achieve but consistently fail to deliver on any of the things they commit to do. They talk about what they are going to do rather than what they have done. Ambition needs an engine, it needs action, it requires mental toughness and when failure presents itself – successful ambitious individuals get back on their bike and pedal that bit harder.
When I coach entrepreneurs, I am constantly looking for ambition evidence. Have they done what they said they would do? Did they achieve that target they set themselves? Was that investment made? Did they hit the financial targets they said they would? A consistent stream of excuses of why things have not been done or failure to execute the actions agreed are tell tale signs that the ambition is not for real. What comes along with hard wired ambition is courage and an ability to extend comfort zones and manage risk.
One of the best definitions of ambition came from Elvis Presley – “ambition is a dream with a V8 engine”. Having a business dream is fantastic, however, without hard graft, long shifts and small nudges forward, the dream becomes a hallucination.
The need to help and support medium sized businesses (MSB) is very much at the heart of economic policy making at the moment. The missing component of the great work research institutes, accountants and think tanks have come up with is, just how difficult it is to set up and build one? Having done it with Winning Pitch (and working with a handful of others to do the same) there are so many lessons I would like to share. Here are 10 platforms critical to anyone on a MSB journey:
- Think big – genuine ambition is vital – be clear on your higher purpose.
- Be clear on the business model – a detailed plan to execute and operationalize the strategy to scale is crucial.
- Understand the different funding routes and instruments to fuel growth.
- A high quality senior team is vital, combine this with a great culture and you have the magic dust – values become more important the more staff you recruit.
- Consider the role of NEDs – having someone who has already done it sat round the boardroom table offers many advantages.
- Don’t be too precious about hanging on to your equity – smart people want a share of the value they bring.
- Embed tight operational control and strong performance management – remember it comes down to always having enough cash.
- Establish a clear brand and communicate this with passion – celebrate with fervor what makes you different and why you are the “go to organisation” for what you do.
- Strong internal (in the office) and external (in the market place) leadership is vital.
- Stay one step ahead of your competitors by living in the customer’s world – deliver innovative propositions with an edge.
From a UK business base of 4.8M companies, 99% employ less than 49 staff. So the current stock of mid sized businesses is less than 50,000. We must not only look at helping existing mid sized companies we also need to address how we fill the pipeline – the next generation.
Sustaining growth beyond 50 staff is a massive task – this is why so many entrepreneurs sell out before they burn out. Beyond 50 staff, business help and guidance becomes more sophisticated – PE/VC, NEDs, headhunters, governance, IPO’s, expensive lawyers and financial engineers, corporate finance… trusted support is pivotal to sustained growth. A community of trusted help is vital to the entrepreneurs who are aiming to do something special with their business.
One of the LinkedIn groups I am a member of, asked if anyone had any tips on how to attain a good work/life balance and deal with the pressure and loneliness (at times) of being a company leader. As I got a few likes on my response, I thought I would share it on my blog.
I have always had a keen interest in the entrepreneurial mindset, in fact I have written a book on it as well. Having observed lots of successful business people over the years, it would appear that those who win, have good housekeeping embedded in their company, strong customer focus and one that often gets overlooked – mental toughness and resilience.
Growing a business is a roller coaster and you should expect the unexpected, period. The loneliness of running a business is a reoccurring comment made by individuals I meet – here are some thoughts:
- Many of the things we worry about are of are own making – be careful of the conversations you have with yourself, they can be extremely destructive
- Create space to think – success is 20% thinking and 80% doing. So many business people forget the importance of ‘time to think’ (I walk my dog for 2 hours a day over the Lancashire Moors).
- Have 2-3 people whose views you respect and trust – give them a call.
- Get involved with entrepreneurial networks – we are all worrying about the same things. Be open and share.
- Aim to build a great team who can share the burden.
- Life is short – remind yourself that a late payment is not the end of the world. Far worse things could happen.
- Maintain good health – without it… Say no more.
Not being able to see the wood for the trees is a common feature of life. People regularly talk about being busy and overworked – but just how much of this is self inflicted. All too often we engage in activity that brings no value to achieving our highest goals and ambitions. Without reflective time, our decision making becomes blurred and it is common to lose sight of what we want. The result is stale thought with patterns of behaviour that fail to deliver our deepest desires. Successful people have the fortunate ability to think clearly, this is helped by finding the time to take well earned breaks from being “busy”. This cleansing process provides the opportunity to de clutter the mind.
The practice of finding sanctuary helps to remove mental blockages and fosters a sense of balance between work and play. Without regular periods of reflection you will find yourself eventually in a rut – the place you don’t want to be!
You must think of Sanctuary on three levels of “time out”:
- Daily sanctuary to help us to prepare for the day ahead – time with family, exercise, meditation, prayer, reading. Starting each day with 10 minutes of deep reflection, provides a kick start to focused activity and just being aware
- Weekly sanctuary that helps divert our energies into non related activities like pursuing a hobby, sport or spending more time with family and relationships. These activities release you from the week that was – puts you in a good frame for the week ahead
- Sanctuary includes those activities that most people can only fit in two or three times a year. They would typically involve family holiday’s, short breaks or some form or retreat. This level gives you the opportunity to ask the big questions – what is my life all about? What needs to change? Should I go and do something else?
Dedication to the 3 Levels will open your mind to new possibilities and opportunities. Chasing success can be as destructive as it is constructive – practicing the art of Finding Sanctuary will build perspective into your life and help to differentiate between what is and what is not important, what brings fulfilment and what does not – embed these disciplines into your routine and you will experience a profound improvement in clarity of thought – you will see things more clearly, you will make better decisions and life will feel less hectic.
A mentor is one of the most important tools in an entrepreneur’s kit bag. Growth companies constantly reach forks in the road – so, which way? As your business gets bigger, then hopefully the team you have created will help you to make the decision on which road to take. However, there are often BIG decisions that are outside the scope of the knowledge of the guys sat around the table. Having a mentor – someone who’s experience and judgment you trust can be a serious crutch on these occasions. Asking those very simple questions like, what would you do? How would you approach it? Who should I go and speak to? Who are the best advisers? – to someone who has experienced the scars of the pain you are feeling is all too often the answer. Every successful entrepreneur we have worked with (and that’s thousands) lean on someone they respect, all too often that advice comes over a beer or coffee. It’s not formal, it’s not shrouded in business plans and three-year P & L calculations – its good, solid common sense.
The reality is that there are so many individuals out there who have succeeded in business, who are more than happy to provide a helping hand – the fact is they have not been asked. The wisdom, experience and insight to help us make better decisions often comes free from willing souls, who just want to help others overcome the hurdles and challenges they face.
So the conclusion is, if you are trying to grow your business, find someone who has been down your path – invite them for a coffee and use the magic words – please can I ask your advice. It could be the best couple of quid you have ever spent.
Most of the battles in business you have to win are in your mind first. Your mentor can help you work out your game plan and indeed make better-informed decisions.
Many individuals have big goals but only few put in the energy and effort to attain them. Why is this? Actions speak louder than words and to be grounded for a second, big goals can sometimes feel like an awesome undertaking. That’s when the goal just remains a dream.
Breaking the £1m revenue target, implementing a new quality system, opening up that new export market or whatever it means to you needs careful planning and iteration.
Patience, routine, trial and error and action are important contributors to passing across the finishing line – you just can’t leap to the end point, that’s why so many just give up.
So what tools can we use to assist us get what we want? I was inspired by the story of what made GB Cycling world class and the envy of other nations . Their coach referred to the “aggregation of marginal gains” as being central to their success. In other words small improvements that all add up to a magnificent performance.
My interpretation of this is:
1. Be clear about what it is you are looking to achieve and and nail a measure and timescale to it
2. Put in place the plan of the milestones and improvements that need to be reached and by when
3. Train like crazy and put in the activity needed to get there – KpI’s (that awful term – but paramount to monitoring where you are – be clear on what they are as well)
The GB Cycling philosophy of marginal gains can be of massive use to us in business. The key lesson is that small nudges in the right direction delivers a winning result. Get on your bike and pedal – if you fall off, get back on and pedal faster!