Lifestyle or Growth – Your Choice
When starting a business, the excitement of creating something from scratch, the often painful process of learning the ropes as you go and the worries about how to pay for everything, rarely leaves time for considering whether the business you just created will result in a comfortable future for you and your family or a runaway success which builds into a high growth company.
In the first couple of years it really doesn’t matter what your expectations are regarding growth, you just do what you have to get to the next step; your first employee, first profitable month, a profitable year and ‘yippee’ congratulations from the Bank Manager. There is a point however, by accident or design, when you will have to make the choice.
Now admittedly for many the choice will be made by accident or external circumstances. And the majority of small businesses stay that way providing a good living for the owners. There does reach a point though where it is time to ask yourself the question ‘what do I want to achieve with this business’.
There have been some who were so confident that they would be the next Facebook or Amazon that in the first year they were planning which corporate jet they should buy! No, really, I’ve met people like that who were yet to make a profit but already spending it. The reality is that most small businesses will stay that way but still be considered successful.
For some though, the chance might arise where your product or service attracts the attention of investors who are willing to fund your growth plans, for a significant share of the profits of course, and help deliver that pot of gold at the end of the rainbow. Bringing in Venture Capital is not for the faint hearted. Forget what you see on Dragon’s Den in the UK and Shark Tank in the US. These are entertainment shows and not how it works in the real world. It is a long (6 to 12 month) process which will dominate your life and have you questioning your sanity even if you are successful. I’ll cover this in a separate blog but sufficient to say that it works only for a few and, sadly for some, results in them losing control of their business.
On the other hand, if you can build a solid business, grow modestly, employ a small team and generate enough profits to top up your pension pot each year, have decent holidays and enjoy life, what’s not to love. Staying small enough to control events, be profitable and grow the team you enjoy working with has a lot going for it. Most small businesses which grow into successful owner managed mid-sized concerns don’t start out with a grand plan. They just get on with the job of growing there customer base, offering good service and building a loyal employee team. It’s not rocket science.
So, before you worry about which direction to go in, do what comes naturally. Build the business, concentrate on the fundamentals and sooner or later the opportunity will appear when you might need to make the decision. If it does, good for you. If not and after 20 years you retire with a fully topped up pension and set sail into the sunset, don’t think twice about Jeff Bezos or Bill Gates. They have their own problems too.