Friday, June 14, 2024
CEOWORLD magazine - Latest - CEO Agenda - Three Tips to Scale Your Business as a Startup Entrepreneur

CEO Agenda

Three Tips to Scale Your Business as a Startup Entrepreneur

Scaling a startup is not easy by any stretch of the imagination. Startup founders often need to leverage credit to bootstrap their businesses before seed or angel funding is available. However, suppliers may not take card payments due to margin concerns, or your business may need to use credit when finances are tight.

Founders also can struggle with a lack of other resources, including personnel and burn out, because they try to do everything themselves. And then there’s the fear-fueled failure to try. There’s never going to be a right time to scale, but at some point – if you hope to grow – you have to just go for it.

That’s why freeing up credit is important; it ensures your supply chain is unimpeded and your business can gain traction. But it’s easier said than done. In fact, according to CB Insights, one of the top three reasons startups fail is because they run out of funds. Nearly a third (29%) of those surveyed blamed this for their company’s demise. Similarly, 8% of respondents cited a lack of financing and/or investor interest.

Below are three key areas to examine when it comes to scaling your business, including why freeing up credit is key to ensure an unimpeded supply chain so your business can gain traction.

Build a residual cash flow

To sustain any operation larger than yourself, you’ll need money. Credit is critical to your scaling journey. It’s not as easy to get money as you might think. By the time you need something, it’s critical that you have it – but when you’re building your business, what you need is not as easily accessible. That’s the startup irony.

Digital tools cost money. Consulting does too. So do the salaries of employees that you’re going to hire. That’s why you need access to a stable, healthy cash flow that will sustain your expansion plan. Otherwise, you’re just building a ticking bomb that will waste a lot of your and other people’s time when it inevitably explodes.

The time to get or build credit is before you need it. You never want to start borrowing when things are going wrong. You want to do this while business is going well so that credit is available to you when you need. Strike while the iron’s hot.

There are a number of options for securing funding, including conventional term loans, short-term loans, business lines of credit and business credit cards. More recently, there’s been an uptick in the use of things like crowdfunding to help secure funding. However you do it, the key thing is to work on this before it becomes a problem; you have to think ahead.

Automate where you can

Where do you generate the most value, and where do you generate the least value for your business? Making this distinction is the first step to scaling your operation. For instance, you may be great at sales and at graphic design. You should keep doing those things and try to automate everything else. The word “automate” could have several meanings here. You can hire freelancers or agencies to do it for you, or you can use digital tools that help you speed up the process.

Understand there’s never a good time to scale

There will never be an ideal time to scale – there’s always going to be some circumstance that could be better. But it’s also true that without making the decisive move, without trying to scale your operations, you’ll never grow to the point where you want to be.

When you build a business, you want to deliver value, but then you also want to be able to scale that value. And to scale, you need systems. You can’t build your dreams with your hands in your pockets; at some point, you have to decide to grow and make a move in that direction. But nothing will ever change if you don’t make that first move.

A scaling mentality

You may have the best business idea and the world’s strongest, hard-charging mentality. But if you don’t have access to finances – before you need them – your brilliant idea is destined for the ash heap of startup failures. A true startup mentality also includes a growth mindset, and that means finding greater financial resources than you have. As the saying goes, “You have to spend money to make money.”

Build a residual cash flow, and establish credit while things are going well. Outsource whatever tasks you can’t do or that don’t deliver value to the company; stick with your areas of expertise and automate the rest. And don’t give in to fear. Remember that there’s never a perfect time to scale. It has to be done if you want to grow and succeed. Secure your finances and make that move.

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CEOWORLD magazine - Latest - CEO Agenda - Three Tips to Scale Your Business as a Startup Entrepreneur

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Chase Harmer
As the Chief Executive Officer, Chase Harmer is the visionary for PayCertify, a worldwide payments company that works with business in the e-commerce, healthcare and travel verticals, processing billions of dollars in transactions annually. Having started in banking at the age of 19, Chase has built portfolios processing billions globally and created several patents through his two decades of experience. Chase Harmer is an opinion columnist for the CEOWORLD magazine. Follow him on LinkedIn.