Everyone wants growth – the question is what to do when you get it. Each week SmartCompany talks to SMEs about the emotional, strategic and leadership effort that it takes to keep your company stable (and your staff energetic) as your reach rapidly grows.
Luckily, there’s no shortage of advice from entrepreneurs who have faced these challenges and come out the other side. Here are five tips from previous finalists in SmartCompany‘s Smart50 Awards for how they managed their growing businesses.
1. Don’t be afraid of raising capital: Vinomofo, Smart50 class of 2015
“We had gotten to the stage where [co-founder] Justin [Dry] and myself both had that real, genuine belief in our guts that Vinomofo could be this thing that is useful to everyone all over the world – that we could be an Uber or Airbnb,” Vinomofo founder Andre Eikmeier said in April.
“We started thinking about the rest of the world and reaching the rest of Australia a lot faster, and we came to the realisation that without the funding we’re actually holding back what we think we can achieve.”
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With this belief, the co-founders embarked on their first $25 million capital raising, which will help them expand into the US in March 2017.
2. Consider selling a stake in your business: Adore Beauty, Smart50 class of 2014
In 2015 Kate Morris sold a 25% stake in her online retail business Adore Beauty to Woolworths. She said at the time that while taking on an investor wasn’t always a key goal, she was aware of the resources it would provide.
“It wasn’t something I was some necessarily aiming at,” she said.
“I really think a lot of businesses sometimes have a primary focus of ‘who can we get as investors’, but that’s the wrong way to go about it. You’ve got to think about what’s right for the customer and everything else comes after that. If you build a strong business, then success will follow.”
“[Woolworths] has a lot of recourses. This is a new vertical for them, premium beauty, but they already have a lot of core resources for running an online business.”
3. Get help from the experts: Punters.com.au, Smart50 class of 2015
Punters.com.au founder Luc Pettett recently sold his business to News Corp Australia and will stay on as chief executive. It’s a decision he believes is “a great result” for the business, but one that also took mental energy. To deal with that emotional toll, he recommends thinking about involving someone who is independent in deal negotiations.
“Much like selling a house, you need someone who is professional to help negotiate in between [the buyer and seller],” he said.
4. Look abroad, and fast: National Crime Check, Smart50 class of 2015
The National Crime Check business grew by 133% between 2014 and 2015, but as founder Martin Lazarevic told SmartCompany last year, once the technology for the criminal history check provider was in place, it was time to “understanding how to push internationally quickly”.
“We are trying to change consumer behaviour to offer up a compelling alternative that can be easy to do and achieve the same end result,” he said.
“We have identified some international markets that would significantly benefit from our online solutions.
“We are looking to take what we have and implement the models into other likeminded countries where police checks are prevalent.”
5. Know the type of people you want in your business: Supercheap Storage, Smart50 class of 2015
Storage experts Edward and Jordana Thirlwall have 27 franchises under the Supercheap Storage umbrella, and have faced the challenge of finding the right people that will deliver for the brand.
“Managing customer expectations professionally and efficiently is vital in this competitive market, so we need to ensure that we have the best franchisees on board,” Edward Thirlwell told SmartCompany last year.
“We now have a set criteria for anyone looking to become a Supercheap Storage franchisee. Prospective franchisees must be a good cultural fit, have a desire for success, ambition to be a small business owner, happy to get their hands dirty and get involved in the business.”