I often get the opportunity to talk to several of my peers, those people I know who were either wise enough, brave enough or stupid enough to walk away from well-paying secure jobs and throw themselves into a new venture starting their own business or being part of a start-up with others. None of them called themselves entrepreneurs, they just knew they did not want to work for somebody else and had an idea they thought would pay their mortgages and might just make them wealthy.
Many of them failed and went back to work for somebody else. Some have tried again and again, and still are. A few have been very successful and are now running healthy and profitable businesses or have sold their business and made a few lifestyle choices of their own.
Whenever I ask this last group, the successful ones what were a few of the defining moments for them, and some of the hardest things they had to do, there was something they all had in common. They repeated the same piece of learning again and again and it’s the “rule of two’s”.
I’m not going to tease you and leave you wondering until the end of this piece what this rule is, many of you may know it already, but for those of you who don’t, or who are just starting out building your first business, here is what they discovered.
When, and if, your business gets to either two years old, or has annual revenues of two million dollars, pounds, or euros, it’s a very good idea to seek external help at a senior level. I do not necessarily mean get additional growth funding and accept the help and advice of your funding partner, although that can be one way. I mean accept the fact that you, as the leader of your business, are probably becoming a roadblock to its continued growth and wellbeing.
Your business is probably big enough and complex enough by now to require you, as the founder and creator to step aside and hire an experienced person and have them work as your CEO. Let them start to run your business with you. Let them help you put the strategy, organisation, and processes in place that your business is already in need of in order to let it become an adult, to help it grow up and become something that is on the way to five million and above in annual revenues.
Every successful person I spoke to when I was thinking of this piece said the same thing in different ways. “I was working twenty hour days and still I could not answer all of the questions my people, clients, and suppliers were asking”. The more telling fact was that those people I spoke to who had failed said pretty much the same thing.
In the first year of a start-up the founder is everything, you answer the phone, make, or support the sales calls, handle the lawyers and accountants, select and negotiate the locations, create or hire the marketing, raise and make sure the invoices are paid and a myriad of other things. Basically, you do it all and at one point it must stop, or the business will.
Most people I spoke to hired others into specific roles such as sales and marketing, finance and many others and had them report directly to them. Those people hired in this way often found themselves waiting around to get the approval of the founder, the great “roadblock” in the business. Many of them left the company because of that. Founders tend to be zealots, passionate control freaks and they don’t believe anybody can feel about their business the way they do. The truth is they don’t!
So, when you are starting up a business, and you are building your business plan make sure that as you hit that first “two” you are allowing yourself scope to have an organisation capable of growing profitably without you filling every role in it. Remember it may be rare for people you hire to feel the same way about your business as you do, but also accept the fact that you don’t know everything and let your people make decisions on behalf of the company. Step aside from the daily running of the business and trust others to help you do that. You will still work twenty hour days, but you will be more productive and add greater value to your business. The only downside is that you will not just worry about if you can pay your mortgage, you will worry about if your staff can pay theirs…and that’s the way it should be.
