Congratulations! You successfully launched a company and are profitable after two years in business. What’s next? As you work on answering my question, thoughts run through your head. How big can we get? Do we need outside investors? Do we need to have a big campaign or have a celebrity endorse our product?
Invariably you start to hear the “myths” of what it takes to move your business to the next level. Before you make a mistake, or even a series of mistakes, let’s debunk some of the more popular misconceptions about small business growth.
1. You Need VC Dollars – Myth! Many entrepreneurs think the surest path to success is to take money from venture capitalists, hand over an inordinate amount of equity (depending on the stage of your business when you take it) and let them tell you how to run it. According to Dileep Rao, an author of several books and numerous articles on financing options for startups to growing businesses, “99.95% of entrepreneurs should stop wasting time seeking venture capital.” I couldn’t agree more. When it comes to small business growth, a traditional small business loan is often better than VC dollars.
2. You Need Your Marketing Campaign to Go Viral – Myth! The meteoric growth in social media usage has created more than a few Internet darlings among small business owners. One of the few downsides to instant fame is not having the capacity to deliver on the increased demand for your product or service. It’s akin to Jonah swallowing the whale.
Some people may argue that you should never shy away from opportunities that can grow your business exponentially. I would counter that, unless you are mentally and physically prepared to grow your company tenfold in a year, focus on organic growth which allows you to build a firm foundation and gives you a better chance at long-term success. You want a sustainable business–not to be a flash in the pan!
3. You Need to Be on Every Social Media Platform – Myth! Social media has fundamentally changed the way we communicate with each other. What platforms do your customers or clients use to communicate about your business or industry? Do they use Facebook? Twitter? LinkedIn? Pinterest? A community web site?
Social media should be viewed as a means-to-an-end for your business. You can use it for customer service, acquiring new customers, market research, competitive analysis, and building your brand, to name just a few options. You may find out that you only need to be on one or two platforms (e.g. Twitter and LinkedIn) to connect with a majority of your target audiences. If you haven’t started using social media or you are still in the trial stages, take the proper amount of time to develop your voice and followers. Think of learning social media as going to college. You can’t take 128 credits in one semester and you won’t learn social media in 30 days. Give yourself, and your employees, enough time to learn how to use it properly. Soon, you will have a new appreciation of the opportunities that exist in social media for small business growth.
4. You Need to Be in the Tech Industry – Myth! Much like social media, the tech industry is playing an important, supportive role in the growth of many entrepreneurial companies in a variety of industries. Technology, like social media, is also a means-to-an-end. Opportunities abound for growing small businesses in financial services, retail, healthcare, education, energy and other industries. Keep your finger on the pulse of how technology is transforming your industry. This approach will help with small business growth and allow you to take advantage of opportunities that arise and keep you relevant in the marketplace.
For a bonus, here’s a fact about small business growth that is true: Have you ever used your smartphone as a GPS device? It’s incredible how you can enter an address into a mapping device and it tells you everything you need to know about going to a place that you’ve never been to before. It even gives you real-time traffic and alternate routes that might get you to your destination faster.
Can you imagine having a GPS device for your growing company? It could tell you what deals you should go after and what deals you should drop. It could tell you where your revenue will come from and what will happen with variable expenses.
The more you plan for your success, the better your odds are for achieving it. Map out your small business growth plans—revenue, expenses, new products/services, partnership opportunities, etc…Also, play the “What if” game which means creating a contingency plan (e.g. What if that big account doesn’t renew next year? Where will my revenue come from to help me reach my goal)?
Having a GPS plan in order to successfully grow your business is NOT a myth. It’s probably the best approach you can take in order to take your business to the next level.