I work with a lot of early-stage founders. Usually the challenge is bringing in systems and processes and finding leaders and managers to take over parts of the business that the founder can just no longer handle because of the volume. This is a key inflection point where a founder needs to start relying upon people to run deliverables and manage clients. And it’s a big shift for many founders.
The challenge is when they hit about $10 million in revenue, a lot of times the systems they built work well for a smaller company, but as they add more people, more processes, more systems, those existing systems start to be the bottleneck to the next level of growth. They’re so happy that a system can run without their day-to-day involvement and oversight that they’re hesitant to touch it. Unless a founder is willing to break and take apart an existing system to build a better system, they’re going to continue to stay stuck.
1. Sales still runs through the founder.
A lot of times the founder is directly involved with and managing and running the sales process. They’re often the ones who are closing the deals, meeting with prospects, and writing the proposals. A CEO needs to be focused on strategic relationships and external relationships, not running the business internally.
I was very involved in the sales process, and I found myself writing proposals in the middle of the night because that was the only time I had to catch up on things. During the day, I was trying to manage the company, work on administrative items, manage clients, projects, look at systems, manage payroll.
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I decided to hire a sales manager to run the overall sales process. Ultimately, I had to get out of sales completely, which was a big step for me because that was my background. I liked it. I was good at it. I generated a lot of value and my ego was tied into it.
2. You still say yes to everything.
In the beginning, you’re saying yes to just about anything that comes over the transom. The challenge is that the client base and your products and services become so diversified that it becomes impossible to manage them and scale them effectively.
A founder I interviewed was running a search marketing agency. In the beginning, they were very focused on search, but started to take on other engagements like web development, Facebook marketing, and Instagram stories. For a services company, you add a new service, it requires a process, a team for delivery, templates, systems, expertise. He had to learn how to say no to additional services like TikTok and Facebook marketing.