So who the heck am I and why would you care what I have to say? I encourage you to visit the How I Help New Business Owners page to learn why you should care and how I might be able
This is my blog where I share some free info to help you plan, launch, and grow your business. I try to cover the topics I’m most frequently asked about but if you have a question you’d like me to answer,
I’m excited you’re starting a business and interested in working with me to make sure the startup process is as painless as possible! Before we get into how you can work with me though, let’s first be sure that you should work with
Not sure if I can help you? Here are some examples of what I do: This is a pretty typical situation: I received an email from an aspiring entrepreneur. The email explained his idea for a political social media website that
Before I get into the post for this week, I have to give a shout-out to the amazing team at Colombia 4.0 – Elkin, Ana, Ivan, Alex, and everyone else…thank you sooooooooo much for the wonderful experience! I was already in love with Colombia but you all reminded me why 🙂 It was an honor to be a speaker there and I hope I can get a copy of the video of my talk to share here on New Venture Mentor.
Okay, now back to this week’s post.
Today I want to quickly discuss the idea of scaling up your business because I see a lot of new business owners get tripped up by this.
First and foremost, a scalable business is one that can maintain or improve profit margins as sales volume increases. A house painting company is not scalable because in order to paint more houses you need to hire more painters and you need to buy more materials so margins don’t really increase much with each new sale. A software company, on the other hand, is often able to scale quite well because you don’t need to add a new programmer every time you add a new customer so the cost per customer of your offering goes down with each new customer added.
A business that is looking to raise money from angel investors or venture capitalists needs to be a business that is scalable, that’s the only way the economics works. An angel or VC makes money when she can exit that company at a much higher valuation than she bought into it at, and that only happens when you’re able to scale. If you don’t have a scalable business, you probably shouldn’t waste your time looking for equity investments because they’re going to be nearly impossible to get.
It’s important to note, however, that when you’re first building your business, you may have to do unscalable things in order to build a scalable business, and that’s okay. For example, the founders of Airbnb initially went out door to door themselves to recruit hosts for their platform. Clearly, that’s not a model that could be scaled well. However, they needed to get that initial critical mass to prove their concept, so that unscalable activity of the founders knocking on doors and talking to people was the only way to get to the scalable business that they built. Ash Maurya has a whole post on this, which I recommend you check out.
So, do you need to build a scalable business if you want to have the next hot VC-backed startup? Yes. Does every single thing you do at every single point in the development of that business have to be scalable? No.
As you build your business, make sure you’re thinking about what your growth goals are and that you’re being strategic about how to get there. That will likely require some real consideration to be given to how to be scalable, even it means doing a whole lot of unscalable work in order to get there.
It’s guest post week again and today we have Rachael Everly sharing her perspective on the importance of getting an outside perspective as you begin to build your business. Here’s Rachael: It’s an established fact that managing a small business
It’s guest post week again. This time we’ll hear from Suzanne Vallance of Ferrari Packaging. Here she is 🙂 ***** The rise of e-commerce has led to more packages being delivered than ever before. In 2015 it was predicted that
Today is going to be a short and sweet episode but I hope you’ll all take it very seriously because I want to talk about empathy. I know the title is a little click-baity but it’s the truth. In my
It’s guest post week again and today we’ll hear from Nathan Hirsch about the pros and cons of hiring remote workers to help you build your business: The Power of an Online Workforce In today’s increasingly web savvy world, business
This week I want to share an amazing tip for getting honest feedback on your business idea. When you’re considering launching a new business, one of the most important things you can do is get out there and ask everyone what
It’s guest post week and today we’ve got some advice on surviving the dangers of the connected world from David Share of Amazing Support: Once upon a time a cybercriminal would deem you a target if you had something of
Today is another quick episode because I want to talk about the importance of finding a wing(wo)man. As we all know, the wingman or wingwoman is the person that goes to the bar or the club with you when you’re
It’s guest post time again. This week we’ll hear from Wendy Dessler: Getting paid is one of the major reasons why companies get into business. For businesses of all types – and this is especially true for new small business