In the old days, start-ups and new businesses blew through their funding rather quickly for the sake of short-term growth. This was almost the norm, with a lot of start-ups aiming for a bigger round of funding as their primary objective. The approach was not the best one to take for obvious reasons. Burning through capital is also not how you take your start-up to the next level.
What you need to aim for is sustainable growth. More importantly, you need to know how to maintain a sustainable rate of growth that is suitable for the business. When the ideal rate of growth is achieved, the company can grow exponentially over a longer period of time. Growth itself is more manageable, allowing you to meticulously plan every step.
While aiming for sustainable growth is a must in today’s challenging market, it is far from easy to do. In order to achieve growth in a sustainable, manageable way, you need to have the right ingredients. There are six secrets to sustainable growth that you can use as you try to develop your start-up with a new round of funding.
Better Human Resource Management
Human resources are your biggest assets. Before you can think about training programs, employee engagement, and personal growth, you need to first lay the foundation for a sustainable HR growth. This means creating a strong HR management team to handle everything from start to finish.
Before investing in employees, invest in your HR management team first. You can look into HR courses and various training programs to help HR executives expand their skillsets and knowledge. Formal courses are worthy investments to make simply because they give access to HR management instruments that you can benefit from in the future.
More companies are investing in better HR management, which is why there are more training programs on the market. You can find out more about the available HR courses and HR qualifications here. Planning a set of programs to expand your HR team should be easy.
Employee Development
Now that you have a strong HR team ready to tackle the biggest challenges, it is time to invest in the employees. Many start-ups forget about how important it is to encourage employees to grow. This is because they don’t realise that the growth of employees translates to the growth of the company. When employees pick up new skills and enhance their abilities, the company benefits from those new skills just as much.
Similar to developing a strong HR management team, employee development is all about planning. You need to match employees’ passions, interests, and existing skills to the programs provided for them. Just like with HR courses, there is no shortage of options when it comes to training programs and courses that elevate employees to a whole new level.
There is another approach you can take to encourage employee development, and that is by positioning the company as a facilitator rather than the provider of development programs. Through simple policies like allowing employees to take courses during company time and giving financial aid to workers who choose to pursue a higher degree, the same rapid and sustainable growth can be achieved.
Aim for Efficiency
Efficiency is how you remain flexible. This too is an aspect that gets neglected by many start-ups, especially those who received a lot of funding. Many start-up owners make the decision to move to a bigger (and fancier) office, to recruit new employees, and to invest in other things that don’t always play well with the overall efficiency level of the company.
Sure, moving to a bigger office is a great decision. Hiring new team members to strengthen different parts of the company is a great thing too. However, these decisions need to be made with operational efficiency in mind.
Is a bigger office really necessary? Is it worth the extra overhead costs that the company will have to absorb after the move? Questions like these are crucial and will reveal so much about whether a decision is right in terms of efficiency. When the steps you want to take significantly reduce operational efficiency, taking the time to find alternatives is how you keep your start-up flexible and sustainable.
Drive Effective Operations
Efficiency is only one part of a complex equation. There is also the need to maintain operational effectiveness. Employees must be effective most of the time; I said most of the time because allowing employees to go beyond the operational boundaries is a good thing for the company too.
There are multiple ways to improve operational effectiveness, but the most important step to take is creating a suitable work – and operational – environment. Provide employees with the necessary tools and instruments so that they can perform optimally at every turn. Make sure employees are working with each other rather than competing for unnecessary reasons.
The more you focus on operational effectiveness, the more you will realise that having a positive corporate culture is important. A culture that supports effective and efficient operations, cooperation, and growth is a culture that will transform the start-up into a desirable, supportive work environment.
Don’t Forget Sales and Marketing
Sales and marketing are two different things, but they are equally important for the sustainable growth of the company. You cannot put emphasis on one and completely forget the other. Marketing is a way to build your brand, to add value to your products and services, and to generate the right level of credibility and long-term relationships.
Sales, on the other hand, is how you convert all of those assets into actual paying customers. It is easy to see how good marketing makes sales easier, and how sales done right can help boost marketing efforts and increase exposure.
Investing in marketing is now measurable. You can keep track of different performance indicators or KPIs and fine-tune marketing campaigns to the last detail. As a result, there is no need to burn through the funds you have available just to acquire new users. You just have to invest more in doing marketing the right way, and the rest will be downhill from there.
Lead by Example
Last but not least, there is the fact that sustainable growth depends highly on your leadership. The decisions you make as a founder and CEO of the company greatly affect how the company grows, including whether the company can maintain a sustainable rate of growth over a long period of time.
We already discussed a few examples of how a simple decision can change a lot. Immediately deciding to move to a fancier office after a round of funding may seem like a good idea at first. After all, you are boosting the value of the company and increasing its credibility. However, that same decision also results in additional costs that burden the business. Without a steady income, maintaining a healthy cash flow will get more and more difficult.
Deciding not to move to a bigger and more expensive office, however, has drawbacks too. You may not be able to hire more employees with the limited space. Changing the work environment isn’t always possible either. That said, this can still be the right decision to make when you consider the cost savings and the level of efficiency you are already maintaining. In the end, the decision is yours to make.