The lure of entrepreneurship has never been stronger. However getting solid information on what’s actually required to make a go of things with setting up a new business is still a surprisingly difficult task.
A worrying number of first-time entrepreneurs jump straight into starting their business with very little idea of what to expect at the various stages they’ll inevitably hit along the way.
Though every business is naturally different, there are distinct stages that are shared across virtually all that you’re almost certain to encounter along the way. In this article we’ll tackle this subject head-on and take you through the six steps of the entrepreneurial ladder that you’ll have to climb along the way to your eventual success.
Let’s start with the most fundamental step of all.
There’s no getting around it, job number one in your new business is simply survival. If that hasn’t already become apparent, don’t worry – it soon will! Though you’ll naturally face into starting up a new enterprise with a song in your heart and the requisite amount of positivity, the reality is that those early stages are usually no picnic.
Statistics vary across countries and different niches, but the stark fact is that roughly a third of small businesses will go under within the first two years. The most immediate priority you’ll face on a weekly level is simply keeping the show on the road and getting through to the next month.
- Breaking Even
Assuming you manage to keep the wheels on through stage one, stage two is all about getting to the point where you’re reliably breaking even and, ideally, turning a small profit to boot. The key concept here is predictability. Small businesses are inherently fluid environments and you’ll probably have to navigate a lot of “feast or famine” stages when you’re just starting out.
Getting to where you know in advance that you’ll be at least breaking even each month is a key stage. Make it to this point and a lot of the day-to-day terror you’ll have been battling along the way will start to dissipate.
- Expanding Your Areas Of Control
Once you’ve successfully survived those tricky initial stages, your attention is naturally going to shift to securing the gains you’ve made and laying the foundations for stable ongoing growth.
In this phase, you’ll be focusing obsessively on defining and implementing systems and procedures that provide the operational scaffolding for your future. Your operation may still be a tiny one in terms of personnel at this point, but it will be an increasingly well-organised one.
- Building Out A Team
At some point in your business, you’ll inevitably have to hire to really expand your sphere of influence and start scaling. If you don’t do this, you are essentially stuck with a job rather than a business.
In stage four, you’ll be focusing on initial hires and building out a team. This is a massive inflection point for virtually all businesses. Get it right and you set the stage for truly transformative growth. However, hire poorly and fail to truly systematise and you risk simply multiplying any existing problems you have.
- Pulling The Strings
Once you’ve got a smoothly running team in place that can largely manage themselves, you’re free to turn your attention to working on the business rather than in it.
This is a massively rewarding stage to get to as a business owner. You’ll find yourself exploring whole new areas of creativity and control as you concentrate on the bigger picture and lock in ongoing profit creation and reliable further growth.
- Building An Empire
In the final stage, your business exists entirely on its own as a smoothly running separate entity. You’ve got effective management in place, it’s spinning off a reliable stream of profits, and you’re entirely free of having to deal with day-to-day operational concerns.
You’re now able to widen your entrepreneurial horizons and consider a whole new set of options. This might include everything from selling up entirely to exploring the huge range of partnerships and investment opportunities that will now naturally come your way.
How quickly you hit each one of these stages will vary wildly from person to person, but once you embark on the entrepreneurial journey you’re nearly certain to encounter all of them in sequence at some point.
Having this potential roadmap ahead of you will go a long way towards providing perspective and helping you battle through when you’re stuck in a particular phase, as well as giving you a clear immediate goal to strive towards. Stay focused on the bigger picture and it won’t be long before you find yourself at the top of the ladder surveying the view!
Tracey Daniel and Jane Challinor are the founders of the Real Business Group, an organisation which assist entrepreneurs and business owners to reach the next level in their business. To double your sales and profits in the next 90 days , sign up for their free Path to Profit event at http://www.realbusinessgroup.com.au/free-event