How maturing startups respond to growth impacts their success. As an entrepreneur struggling to manage your maturing startup, you need to learn how to survive the new stage of your company’s growth cycle that you are entering. We caught up with former Angellist Partner Lee Jacobs to get his take on how maturing startups should manage growth. He offers some key management techniques to implement in your startup. Whether you have an ample amount of funding or not, strong management skills can save your startup and help your business overcome challenges to growth. Follow these expert insights on maturing startups from a seasoned investor.
Get Access To Capital
Managing startups, entrepreneurs need to have a clear sense of the capital requirements for their company. In an early stage startup its difficult to predict revenue, but much easier to control your costs. It is a good idea to do 6 month plans in order to understand the cash needs of the business.
If a company decides to raise capital from investors, people like Lee Jacobs expect founders to present the opportunity clearly. He explains, “Sure, there are investing areas and industries where I’m more interested than others, but what I really try to do is start with a blank slate and have the entrepreneur tell me why a particular opportunity is interesting. And then I get excited”.
If you receive funding from an experienced venture capitalist, they can assist you in determining how you should use the capital to grow your business.
The Story behind the business matters
Every business starts with a founding narrative. As the business matures, decisions are made along the way the effect the trajectory of the company. Various product decisions, hiring plans executed. Being able to articulate why decisions are made are important as you scale your company.
Jacobs notes, “Every opportunity and business is unique. For example, in certain market with long sales cycles, you wouldn’t expect a company to have millions in sales in the first year. What I care about is the story and how it got there.”
If you want to motivate your team, you need to show that you are motivated as leader to achieve a greater core vision and values. More so, you need to communicate your story to investors, employees and potential customers. When consumers or team members feel a brand’s energy and commitment, they will support the company. Thus, you need to stay interested in market opportunities by creating your own story.
Focus On The Relationships
Strong connections between employees, founders and investors are crucial for any growing company. , Jacobs had the following to say, “”When investors and founders share a common vision, it sets the foundation for a strong relationship moving forward.”
When startups begin expanding, entrepreneurs often acquire many new responsibilities and forget to communicate with their employees on both personal and professional levels. As a result, company culture suffers, and employees become unhappy with their daily work days. To avoid losing employees as your startup matures, constantly put in the effort to build relationships throughout the company.
Have Deep Customer Empathy
Asked about what type of founders are most successful, Jacobs replied, “Entrepreneurs need to solve a need for customers. This begins with understanding problems and having deep customer empathy.”
In order to have real customer retention, founders needs to continually be in touch with the needs of the their loyal base. It is easy to get lost in the prioritization of other things– but startups will die without staying on top of what their customers need.
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