You’re on the cusp of a business milestone: your first year to post $1 million in revenue. Time to celebrate. But better keep the party short as you now have to gear up for a new and probably more challenging phase in your career as an entrepreneur.
Recording your first million means your business is growing and succeeding. But as you rack up more sales and more marketplace wins, you’re bound to encounter more and sometimes bigger hurdles. Chances are you’ll need more people, more skills, more money and, most important of all, more patience and wisdom.
That was certainly my experience when my company, BlueVine, hit the million-dollar mark a couple of years ago. And that’s what many other small businesses on the verge of becoming significantly bigger go through. For most fast-growing small businesses, reaching that milestone means important changes. Here are four of them:
Be ready to hire more people.
You probably took on multiple roles as you were starting your business. You were head of the company, as well as the accountant, the press release writer, the social media manager and the cleaning guy.
You brought on more people as the business grew. By the time you close in on the million-dollar mark, your human resources needs are likely going to be bigger and more complex. You’re no longer just the head of the company with an immediate staff.
You need people to focus on more specialized functions, from finance to sales to marketing. Eventually, if you continue to grow, you need a management team in place to make strategic decisions.
Hiring itself becomes a formal process. When you’re a small company, you hire people based on who you hear is looking for a job. So you rely on your network or the networks of friends. When you’re already around 10 people, your search for talent becomes more sophisticated, involving professional recruiters and advertising.
Let me stress an important point here: as you become a million-dollar company, hiring and growing your organization will be one of your primary concerns. In fact, that’s where I think BlueVine stumbled a bit. We should have hired faster and more aggressively. When your company is growing fast, you simply can’t underestimate the importance of talent.
Be ready to make changes in the way you operate.
Like most entrepreneurs, you may have started your small business based on a basic legal structure, as a sole proprietorship or a partnership, perhaps. You may have had to change this as you got bigger, transforming the business into an LLC or a corporation. Now, you may have to make more changes in your legal structure as you get bigger to ensure that you have the necessary legal protections in such areas as liability, taxes, contracts and intellectual property.
This is an area where some business owners make serious mistakes. Many of these legal issues are complicated and it’s…