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Sweet marketing music

Tanner Montague came to town from Seattle having never owned his own music venue before. He’s a musician himself, so he has a pretty good sense of good music, but he also wandered into a crowded music scene filled with concert venues large and small.But the owner of Green Room thinks he found a void in the market. It’s lacking, he says, in places serving between 200 and 500 people, a sweet spot he thinks could be a draw for both some national acts not quite big enough yet for arena gigs and local acts looking for a launching pad.“I felt that size would do well in the city to offer more options,” he says. “My goal was to A, bring another option for national acts but then, B, have a great spot for local bands to start.”Right or wrong, something seems to be working, he says. He’s got a full calendar of concerts booked out several months. How did he, as a newcomer to the market in an industry filled with competition, get the attention of the local concertgoer?

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by Leigh Bailey
February - March 2011

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How to move from start-up to grown-up

If your answer to this question is an immediate, “yes,” you may be ready for the next cycle of your company’s growth. However, these next questions are harder to answer: What does that bigger company look like? How will your role change in this bigger company? What will it take to get there?

Over the years, I’ve met many entrepreneurs who are highly strategic and have designed a formula to eventually step out of the way and allow a new leader to step in without the company missing a beat. These serial entrepreneurs enjoy the thrill of starting a new venture and developing it enough for others to take it to maturity.

Still other entrepreneurs – the majority of them – are technical experts who grew a firm organically based on demand for their product or service. Their personal credibility and expertise are often the brand or face of the firm. People buy because they trust the entrepreneur to deliver something they value.
Time to change

In order for you as an entrepreneur to move from the start-up and survival phases to the level of a grown- up and sustainable business, you have to answer the questions above. Just as importantly, you have to understand what is required of you personally to reach the goal.

Here are several areas that entrepreneurs must explore to change their thinking about themselves and their businesses before they can grow their businesses to the next stage.

1. Consider the costs and benefits. There are benefits and also costs for an entrepreneur to transition to a larger organization. The benefits include more revenue and sustainability, more capital for innovation, larger clients and perhaps more life balance.

The costs could include moving away from the hands-on client work that you love in order to run a company. It could include more time in the office rather than less in the initial growth stages. It might require tough decisions about personnel or a pet business focus that isn’t profitable.

Weighing out these costs and benefits, you have to decide if the benefits outweigh the costs in the long run. Are you willing to pay the price and put in the sweat equity to grow the organization, or are you content to stay more entrepreneurial?

2. Pinpoint value. Does your business have the potential to grow? Entrepreneurs are naturally optimistic and hard working, often believing that their sheer will and labor can overcome any obstacle. In truth, you need to understand the true value that your product or service brings to the market.

This step requires thorough market analysis to determine your competition, see opportunities that they have missed and understand what you have that they don’t. This is the process of moving your organization from a personal brand to a brand that communicates a unique value proposition to customers.

You might think that you handled this due diligence when assembling your initial business plan. The truth is that your business plan must evolve from individual value to corporate value. Just interview a few of your current customers. If they mostly talk about how great you are, you know that the survival of your business still depends too much on you.

You need to understand how your organization delivers value without you in the picture. It’s a humbling exercise, but critical for growth.

3. Chart a course. It’s time to create a strategic plan, which becomes your road map for business development and marketing, talent, budgeting, information technology and the creation of intellectual property and processes that will sustain growth.

Define destination

How do you know that your strategic plan is the right one? It comes down to those initial questions: what will your business look like a year from now or five years from now; what is your destination? Your strategic plan works backward from that destination and lays out the steps to get you to that vision.

If you are unsure of the process for developing a strategic plan, consult your network of advisers. Talk to fellow entrepreneurs who have built grown-up organizations. Ask them to review your plan to identify gaps or challenges. Set meetings with your CPA, banker and attorney to discuss.

4. Assess the talent. In order to execute your strategic plan, you need to assemble and align your team. Decide on the core strengths or competencies that will be necessary to complete each phase of your plan. Then assess your current talent to identify where you have the right strengths and where you have gaps.

Through this process, you are likely to discover that some of the leaders that succeeded when your business was in the entrepreneurial stage are not ready to lead a bigger firm. Some of your current leaders can be developed; others will need to be replaced with new talent. This is one of the painful but necessary parts of becoming a grown-up business.

5. Systematize critical functions. In addition to talent development and alignment, grown-up organizations also develop proprietary systems and processes that support the onboarding of new people while also building efficiency and value.

You’ll need efficiency to increase your customer base. Designing and building repeatable processes that deliver consistent high quality results is one of the best ways to invest in the value of your business.

6. Let go. With all of these pieces in place, what is left for you, the entrepreneur, to do? In fact, this is where the true leadership transition takes place. By freeing your time from day to day management, you become the leader who assures alignment between the strategic plan, your people and processes and your ultimate destination.

This is a difficult transition for some and a leadership breakthrough for others as they let go of the old roles to oversee a larger enterprise.

Isn’t this, after all, the true mark of the entrepreneurial leader? You make a difference, you make a living and you’ve made a life.