According to a recent U.S. Census Bureau report, there are over 30 million small businesses in the United States.
Each of these business owners had to come up with an idea and execute it on a budget. To scale your tech business, you’ll need to be just as in tune with your finances as you were during your startup phase.
Technology startup costs can be substantial. Scaling your business will also cost your company, so it’s paramount that you’re ready to take on the investment.
But, with the right tools, ideas, and strategies you will see a return on your start-up costs and investments through your business’s profits.
So if your business is ready to scale and you have a budget to stick to, then you’re probably wondering how to make it a reality.
Read on to discover 5 do’s and don’t’s to scale your business on a budget.
5 Do’s and Don’ts to Scale Your Business on a Budget
Business growth is a key component to success and longevity. Businesses are an investment, so making wise business decisions to scale your tech business is vital. Explore the following do’s and don’t’s to make sure you’re setting yourself and your startup business up for success.
1. Do Create Structure
Before you scale your business, it’s important to create management/employee structures. Aim to keep teams small so that managers aren’t overloaded and employees feel heard and valued.
It may seem like a pain to have multiple managers reporting to you, but it will help everyone to do their jobs more efficiently. It will also teach your employees how to communicate better and solve problems promptly.
You’ll also need to learn how to be the best leader for your startup to scale effectively. Practice actively listening to your employees, experiment, and be transparent.
2. Do Pump the Brakes
If now doesn’t seem like the right time to scale your business, then pump the breaks. Pumping the breaks doesn’t mean that scaling your business won’t come to fruition. It just means that you may need more time to get important components like marketing and customer relations in order first.
3. Do Cultivate Pride
Give your team something to get excited about. Get them on board with a cause and cultivate a sense of loyalty and pride in your company. When your employees feel a sense of loyalty to your startup business, they’re more likely to come up with creative and innovative solutions.
4. Do Manage Your Finances
Before you scale your business, assess your current financial status. Take a look at your expenses, profit, and your bottom line.
Scaling your business will cost money so you’ll want to make sure that you invest wisely. You also want to make sure that your scaling costs are manageable. Start by collecting a list of all potential scaling costs to get an idea of how much capital you’ll need.
Then, consider whether you need additional capital or if you have enough to spare in your profit margin. Also, determine your risk tolerance level. If the budget seems tight, then don’t hesitate to go back to the drawing board or wait until your finances are healthier.
5. Do Achieve Your Goals First
One of the most important signs that it’s time to scale up is when you accomplish your initial business goals. For example, you’ve reached a specific profit margin, achieved a certain amount of sales, or hired a specified number of employees.
Once these goals are met, then consider scaling your business. Scaling your startup business before these goals are met could lead to a lot of confusion about what move to make next.
6. Don’t Live in the Past
When businesses do things the way they have always been done, innovation suffers. Don’t be afraid to leave business processes in the past if they don’t seem like an asset to your company. You can also outsource non-essential duties to other companies to ensure your business has more time to focus on scaling the company.
7. Don’t Ignore Your Limitations
Ignoring your limitations could cause your business great harm. In fact, ignoring limits could even cause your business to fail. That’s what happens to 74% of tech start-ups who decide to scale up before the time is right.
Some limitations to consider include your capital, your current computing systems, and how many employees you have.
8. Don’t Gloss Over IT
Tech companies know all about IT. But, is your IT system currently prepared for scaling up? Before you go full speed ahead, make sure to check in with your IT system’s capabilities.
Make sure your servers, CRM systems, and all other computing systems are ready to handle a surge in business before you scale.
9. Don’t Hire in a Pinch
Take your time and hire the best people for your company. Don’t feel pressured to hire more people just because you have a vision of scaling up. Hiring more people could also be a sign to slow down to avoid draining more resources.
Scaling is a process. It’s best to have the right people to support scaling your business than to have semi-qualified employees just trying to do their jobs.
10. Don’t Be Carelessly Optimistic
Optimism is a wonderful quality, but in business, you need to also be realistic. Avoid getting overly excited about an idea or strategy without thoroughly studying it and testing it first. There’s really no rush and you’ll be happy you looked at multiple strategies instead of settling on the first one that sounded like a great idea.
Be optimistic, but don’t be careless about choosing the best strategy to scale your business. Sometimes the best strategy is to not scale at all until you’re completely ready to handle the additional responsibilities.
Scale Your startup Business the Right Way at the Right Time
Scale your business when your business, employees, and systems are ready for it. When it comes to growing your business, timing is everything. The right timing means that your startup business is ready and able to handle a surge in growth.
Want to learn more about scaling your startup? Let’s connect! Contact me today for more startup advice and guidance.
