In my previous blog post, I outlined the four phases of company growth I use when business planning for startups. In this post, I will explore the first phase: the startup phase.
This period is marked by uncertainty, rapid change, and the need for adaptability. In this article, I’ll share my personal experiences from my time building Elabor8, and some insights on how we navigated the challenges.
Wearing Many Hats and Overcoming Challenges
The early days of a startup company can be a whirlwind of activity, with founders wearing many hats and taking on a multitude of responsibilities. As a founder, you’re both operating and managing the company, filling in gaps and making crucial decisions.
Keeping It Small and Focusing on Core Competencies
In our early days, we kept our operational footprint small to minimize overheads and maximize efficiency. We avoided taking on too many responsibilities and instead, we split up as founders and took on functional responsibilities that correlated to our strengths and used specialist service providers in a part-time capacity where we needed to fill in gaps in our expertise. Namely in finance, accounting and legal.
To keep our costs down we leveraged SaaS-based IT solutions, which were still relatively new and forward-thinking at the time (circa 2010) and we intentionally created a serverless IT infrastructure, using SaaS solutions exclusively to ensure we could avoid having expensive servers to administer and administrators to administer them.
We were fortunate that the Google App Ecosystem was available to us, and we fully leveraged this marketplace, which allowed us to bolt on various applications to provide solutions for each of our functional areas including marketing, sales, recruitment, and HR. In the early days, we took advantage of Xero, which was a pioneer in cloud-based accounting software so that we could easily collaborate with our accountant. We were also early adopters of Trello for managing business operations with simple and visible workflows, and we used PipeDrive and Contactually for CRM, and Recruiterbox for recruitment to give us best practice functionality and process. Over the years, we have upgraded these solutions to maintain best-of-breed systems in each respective domain.
The Difficulty of Getting Off the Ground
Starting a company from scratch can be a daunting task, and it’s natural to feel like nobody cares about your vision and mission. I remember often lamenting that we were trying to bring something new and innovative to the marketplace, but that the marketplace didn’t seem to care. We encountered this sentiment frequently, especially when dealing with procurement teams who often seemed more interested in cutting costs than helping their organisations execute their strategies by taking advantage of the best possible vendors and partners (but that is a topic for a whole other post). Moreover, even when we succeeded we faced the challenge of long and complex procurement processes, which proved to be a significant hurdle in securing our first major clients.
In our initial attempts to win business, we failed to secure contracts with our first two major clients. They were understandably cautious about engaging a brand new service provider with no assets and clients, let alone young and unproven operators. To overcome these concerns, we had to leverage our relationships and influence various stakeholders within those clients.
In both cases, it was only by having the founders personally oversee the work on-site that we were able to alleviate their concerns and establish the initial relationship. By demonstrating our expertise and dedication, we were able to break down the barriers and secure the trust of these clients and their operational teams. This experience taught us the importance of building relationships, persistence, and the value of personal involvement in winning over clients during the startup phase.
People First
In a services business, well in any business really it is essential to understand that business is done between people, not companies. In the early days, we put a significant emphasis on recruitment, recognizing that our people were the backbone of our business. Our website initially focused more on our own aspirations and ambitions rather than directly addressing customer needs.
For at least the first five years, all three founders personally conducted detailed competency interviews with every new employee. Additionally, for at least the first ten years, a founder was involved in the final cultural assessment for all employees. This approach was crucial in building a team that shared our values and was committed to delivering exceptional service.
We instituted very detailed competency assessments and role-plays in our interview process. These measures helped us attract a cohort of humble, dedicated, and eager-to-learn individuals who were committed to honing their skills and delivering outstanding results. By implementing most of our quality assurance within the recruitment process, we were able to give our people more autonomy and trust them to work with minimal oversight.
We also built a career development framework early in the company’s history, which helped our employees identify their career paths beyond their time with us and ultimately accelerated their careers. The results of our approach were evident in the success of our alumni, who often credited our career development framework with helping them pivot into more fulfilling and successful roles. It was extremely rewarding to see the positive impact we had on our employees’ careers and to know that our focus on people-first had contributed to our company’s success.
Business is Done between People, not Companies
The early years of a startup can feel like an eternity, and it’s crucial to stay focused and adaptable. We found that it took at least five years for our company to establish itself, build a reputation, and gain traction in the market. During this time, we prioritised building strong relationships with our clients and our community.
Within a B2B context, delivering exceptional outcomes for your clients is key to long-term success. We aimed to engage our customers not just by providing a service, but by helping them to realise their vision and progress their careers. By staying apolitical and consistently delivering results, clients will often bring you in again and again as they move around the industry. We were fortunate to work with several key clients across various organizations, and our focus on delivering high-quality service paid off as they continued to bring us in as their needs evolved.
Lessons Learned
In summary, the startup phase of our company was a challenging but rewarding experience. We learned the importance of:
- Leveraging low-cost operations to keep costs low
- Prioritising recruitment and building a strong team culture to ensure exceptional service delivery.
- Delivering exceptional outcomes and building relationships with clients
By heeding these lessons, we were able to navigate the challenges of the startup phase and lay the foundations. As you embark on your entrepreneurial journey, remember that perseverance, adaptability, and a commitment to your customers and employees are key to overcoming obstacles and achieving success. Stay tuned for my next blog post, where I’ll delve into the stabilise phase.
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