The Best Investments Entrepreneurs Can Make At Every Stage of Growth
There’s one question I get asked by entrepreneurs all the time:
What’s the most important thing I can invest my money and resources to make sure my business grows?
If you’re an entrepreneur, you’ve probably asked yourself the same. I know I have.
It always seems like there’s not enough money or time to allocate to all those important things. And that’s problem number one.
Problem number two is that there’s no one-size-fits-all solution that’s going to help every entrepreneur out there.
The answer depends on the stage your business is currently at.
If you’re running a 100k MRR business and spending 80% of it on overhead costs, you’re probably going to want to automate as many tasks as possible.
On the other hand, if you’re only starting out and your business is still your side hustle, you’re going to need to get profit to make it full-time. Fast.
9 Stages of Growth
We’re going to be using Alex Charfen’s data for different stages of entrepreneurial growth.
[Image source: Alex Charfen, http://billionairecode.com/hosted/images/6d/294020d63911e88bec41cf7da3afb2/BC-Accelerator.png ]
Alex sums up the process nicely. Each stage of your business’ growth needs different things, so responding to a question of what you should invest in now depends on what your business needs now.
Growing Your Side Hustle to a Business
This is the first stage of the entrepreneurial journey. Usually, before we reach the $100,000 mark, we’re still at the part-time mark and our businesses are side hustles we’re looking to grow.
The main thing to do at this stage is finding product-market fit.
What does this mean? Should you invest in tech?
All you need to do at this stage is put out feelers and see how people (the market, your audience) respond to your idea.
Let’s say you’re developing a new product that’s going to help 20–30-year-olds develop their careers much faster than with traditional channels.
You need to get out there and tell them about your idea.
You need to talk to your audience and see whether they think it’s useful and whether they even understand why they need your product.
The best thing to invest your money and resources into at this stage is creating content.
Create content that’s going to reach and resonate with your audience. This can be blog posts, eBooks, videos, webinars — anything that adds more value.
Content is king, after all.
For example, I’m doing it with Facebook Lives to get in touch with the people who are my target audience, and to understand how I can develop my product to best serve their needs (product-market fit is all about that).
I’m still agile in my approach so I can change strategies and adapt my product to what my audience responds best to.
If you invest in tech at this stage, you’re still unsure of the product-market fit, and the chances of losing money by investing into the wrong thing are very high. It’s better to get in touch with your future customers and find the ones who need your product or educate them.
Of course, you can also add people to your mail list with tools like MailChimp which are free for up to 2,000 subscribers.
And this is another perk of creating awesome content — people will want to read more, they’ll want to stay informed on what you’re doing.
Promoting Your Ideas
When you’re at the $100,000 mark, that’s when you should start asking people if they’d like what you have to offer.
By then, you’ve gained their trust with valuable content.
And your main mission at this stage is spreading your voice, promoting your content even more until you’ve grown from $100,000 to $300,000.
If you want to invest in something when you’ve got quality foundations like the ones you’ve set with content, invest into technology that’s going to help you reach even more people.
Next Stop: Leveraged Sales
The next stop is definitely sales.
Sell as much as possible.
You’ve found the right kind of customers, motivated them with content, and its time to leverage that (and tech) to get sales.
If you’re doing it right, you may find that the best thing to invest in here is automating your sales process.
You want to be focusing on scaling your business and increasing sales, and you can’t do that if you’re still doing everything manually. That’s why we need some degree of automation to get leveraged sales.
Yes, I often talk about not needing CRM systems (customer relationship management systems) but they can be a good fit if you’ve got specific needs.
If you need something right now, improvise a CRM system to get leveraged sales with Trello and Zapier.
For streamlining bookings and learning more about clients’ unique needs, check out Calendly.
At this stage of your business’ growth, you need to introduce some degree of automation to be able to generate even more revenue.
Creating Systems & Processes
Once you’re en route from $300,000 to $1 million, you can no longer say that you’ve got limited funds.
However, your needs change. You no longer need to push as hard on sales manually, or focus on getting your content out there.
What you need are systematization and processes.
You want to create systems and processes that reflect the methods that helped you reach this level of success. If you want to replicate them and use them to fuel your future growth, you need to make a system out of these behaviors and methods.
This is the point where you get a bit more into automation. You use software like Process Street to help you understand, organize and optimize your process and workflow.
You may also need more advanced communication systems to keep everything up and running successfully. Usually, entrepreneurs use Slack to communicate with their teams, and Intercom to communicate with customers.
The main goal of this stage is understanding what methods led you to success, and turning them into systems that will keep the machine going, bringing you even more revenue as you focus on different strategies.
Do We Need Tools to Grow as Entrepreneurs?
You can reach your million in revenue without spending a single cent on tech, but it can be time-consuming. That’s why I encourage tech in moderate amounts to make the workload easier.
However, the main thing to remember is that you have to focus on things that bring immediate value and explain the benefits of your business for your potential customers.
After that, conversion becomes a piece of cake.