From Elaine’s Notebook: Scaling, the Impact on You as a Leader

Attend any Entrepreneurs’ Forum event and you’ll likely meet Elaine Stroud – the Forum’s CEO, a champion for North East entrepreneurship and an avid note taker! In this article she details what she learned at our round table discussion ‘Scaling, the Impact on You as a Leader’ led by hedgehog lab co-founder Sarat Pediredla.

According to the ScaleUp Institute, scaleups generate 58% of the UK’s overall SME output and their contribution to our science and technology advancing, including creative, finance, manufacturing, wholesale and green industries is significant.   

This brought us together this month, at our latest round table, to consider how scaling up impacts the leader. We invited Sarat Pediredla, co-founder of hedgehog lab, to host a discussion based on his own experiences.  

Here’s the key points we discussed which I hope are useful considerations for any entrepreneur considering business growth.

1. Make sure you are clear about your motivation to scale your business. Entrepreneurs sometimes feel that there’s an expectation that they should be going for growth all the time.   It was clear from this discussion that growth isn’t for everyone and that entrepreneurs can lead impactful, successful and rewarding businesses without scaling up. Scaling isn’t for everyone and it’s your business so make the decision that’s right for the type of business you want to own.
2. Organic growth is OK but scale-ups need cash and you should be open to investment. A good business will be attractive to investors, meaning you can use external money, rather than your own, to fund expansion, which can reduce your personal risk. Bringing in finance also brings professionalism to your business. Educate yourself about finance as it can be confusing and it’s important to get the right fit for your business.
3. Get the right people in the right roles for growth. Consider if your current staff have the experience to help you grow and run a much larger business. Either invest in training them or find staff which are more equipped to help you scale.
4. Make yourself replaceable in your business. If you’re not interested in this question then ask yourself why you are scaling. In a small business, the owner/ founder is the critical to every decision. This won’t work in a scaled business and you’ll need to bring in other people to reduce the reliance on you. Consider if you have the skill set to be CEO of a larger version of your business.
5. Be clear on how comfortable you are, as the owner, with risk. Scaling up has increased financial risk and loss of control risk. 
6. Scaling up will take you out of your comfort zone. Get a business coach, mentor and/ or external advisors to help you to develop and make good decisions. If you don’t have a formal board then seek out people who can help you in the areas where you are weaker.