How to scale an SME
Scale and next-level growth are frequently-used terms, often with a good dose of hope and prayer. What do they mean and more importantly, how do you attain them, is the question any SME investor should be asking.
Without achieving scale, growth brings chaos and chaos invites risk. Yet without understanding how to scale a business, that is, without understanding how to grow the capacity of a business to deliver massively increased services or products, how can you understand risk in terms of growth and scaling?
Often people think that a business plan and money are the seeds that will nurture scalability. It’s sadly not that simple. A business is like a person. It starts and builds and develops through a business lifecycle. Each stage requires right action and leadership to get it built through these stages of growth and development. Faltering on any one of the stages stalls that growth and progress.
A person is born and grows through life stages, too. For example, at five years of age, a child cannot lift more than, say, a 5kg weight. The child simply does not have the bone density and muscular structure to cope with more than 5kg. A business's "bone density and muscular structure" are made up of its system of delivery and the mind-set and behaviour of the founder. Both need to change over time to support the scaling of the business, because getting this wrong is what leads to the weight of growth collapsing the body of the business (and the entrepreneur).
Aurik has developed an investing approach and methodology that is integrated with the business lifecycle. Our underlying data management system enables us as fund managers to measure and determine the optimal points of support and funding to ensure that scaling will be achieved. It’s a slightly old fashioned approach to building a business if you are an impatient investor or entrepreneur. But if it grows too fast, then it’s probably a weed!
Let’s work together and put a considered, patient SME strategy in place so that your organisation can capitalise on SME growth, innovation and secure commercial and financial returns for the favour.