How do I know when my company is ready to scale?

Posted by Robert Norton on

To me, scaling means growth over 50% per year, which can become exponential in a few years. That kind of growth requires that a company be very developed in its internal processes and systems. And it must also have a serious and experienced management team.

Planning this growth is complex and will usually also require outside capital.  You also need complete systematization in each area of your business, not just to “Do it” but also to hire people, train people and manage those people too. So, with five departments this means four times five total procedures or systems to “do it” (i.e., sell, delivery, generate leads), hire, train and manage (by the numbers).  Or about twenty total systems. These may be simply a few pages, and I usually recommend a flow chart as a visual helps people learn and improve these as more employees join the company. 

Shifting gears as a company moves to rapid growth is very difficult, and few figures it out themselves. They need help from those who have done it before. Contrary to popular belief, behind every success is both a team of experienced people and usually a long story of trial and error (pivots) that never make it into the press or “history” because people tend not to brag about the mistakes.  PayPal started as a company planning to send money from one PDA to another only while the people were in the same room. It pivoted and adjusted to become what it is many times. Though almost everyone signed up for a PayPal account, only after they offered the previously unavailable ability to send money by email. All super successful companies do something others cannot or do it a lot better. A differentiated product or service is usually required to scale, too.

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So, if you have a strong management team, a differentiated product and are mostly systematized you may be ready to grow faster. We also believe that management systems are required to keep the wheels from falling off as the company accelerates. You can read about these six systems here. Three should be installed between five and 25 employees and the other three before you reach fifty employees to control your culture and growth without having lots of problems as you grow. You can also see our specific courses on preparing for growth here.  And see all our courses and coaching programs related to scaling here.

Also check out my blog where I have loads of articles on entrepreneurship, scaling and raising capital.

Click here to visit my Blog

Another consideration before you scale is building a board of advisers and or directors that can help to provide independent input and strategic direction, as well as connections. There is an old saying that says lunch with a wise person is worth reading fifty books.  Although I strongly recommend you do both as there is no better way to avoid the mistakes of others than learning from lots of people. And having a good mentor that has already done what you want to achieve.  So, if you want to get your company to $10M, $25M or $100M be sure to have someone on your advisory team that has done exactly this before.

I currently limit my mentees to five at a time, with weekly calls. This program is $2,000/month and can generally double a company’s growth rate and/or revenue within six to twelve months.  Call (619) SCALE06 if you are interested in applying or being on the waiting list.

Bob Norton is a long-time Serial Entrepreneur and CEO with four exits that returned over $1 billion to investors. He has trained, coached and advised over 1,000 CEOs since 2002. And is Founder of The CEO Boot Camp™ and Entrepreneurship University™. Mr. Norton works with companies to triple their chances of success in launching new companies and products. And helps established companies scale faster using the six AirTight Management™ systems. And helps companies successfully raise capital.

Call (619) SCALE06 or email for a complementary strategic consultation

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