Get Scaleup Smart: What I learned about value creation AFTER I sold my first company
When I launched my first business, Rock Media, I was doing everything from product development to sales and marketing, from operations and paying suppliers to completing tax returns. This made it very difficult to carve out time to look further ahead and wasn’t conducive to achieving true scale.
After selling the company in its fourth year, I was lucky enough to be invited to advise on buyside M&A for a major corporate. I swiftly learned all the ways in which I’d left value on the table!
Looking back, I really hadn’t given myself a chance to maximise on my vision. I didn’t fully commit to building a team or implement processes which enabled me to remove myself from the detail and focus on my bigger objectives.
In some ways, that’s OK. I created a product and market position that made my business desirable to a buyer; I learned a lot through the sale process; and it got me a seat at the big table, investing tens of millions in acquisitions, at a relatively early stage in my career.
Work on your business - or be dragged into firefighting
But it left me with unfinished business. In the following years, I led many acquisitions as an adviser, whilst building up new companies with my own capital and new teams. Each investment, each transaction, each pivot taught me something new about scaling up. All the time I was seeing what happens when entrepreneurs don’t step away from the frontline and plan for growth:
Missing or misjudging opportunities
Churning valuable customers
Eroding market or audience share
Weakening brand value or reputation
Losing talented and engaged team members
Offering misaligned value propositions
Burning out
Business failure
I had always thought that the media business (that’s my sector) was about building great products and selling them to the right people. I hadn’t thought deeply about people, process, and culture – but those are your biggest priorities if you want to build a sustainably scaling company.
I’ve seen how easy it is for entrepreneurs (and trust me, I’m no exception) to get distracted by new products and business models if they haven’t built the right culture and a robust operating model.
“There’s also a temptation to hold on to founding staff members; but your launch team (adventurers) will almost certainly be replaced by a “Scale Team” who are more like city planners, to quote Adam Raleigh of Markets Group.”
Broccoli and push ups
Here’s the hard news: when you started your business, it’s very likely that you played to your strengths: research, product, sales, or community-building. But as your business grows, it becomes hard to balance the company: for example, a narrow focus on research and content can distract from the hard but essential work of building a predictable and scalable sales operation.
In order to scale your company, you need to build strong foundations in the areas that don’t necessarily come easily to you:
Sales and marketing
Structured, data-led decision-making
Regular financial reporting and forecasting
Team capabilities and development
These are the “broccoli and push ups” of successful entrepreneurs: you don’t want to do them, but you know they’ll make you fitter, and you’re always proud of doing them afterwards!
The Scaleup Toolkit
My team at Collingwood Advisory has talked to hundreds of entrepreneurs about this problem, and the message is clear. Even for entrepreneurs who’ve held senior roles in other companies before they start their first business, it’s planning that is the first thing to go.
So we created The Scaleup Toolkit to give entrepreneurs a framework for catalysing change. You can download a copy here.
About the author: Piers Bearne
Piers Bearne is the Founder and CEO of Collingwood Advisory, the leading value creation advisers to independent media companies. He has built and sold three businesses, led multiple buyside and sellside transactions, and is a former MD of Terrapinn and CEO of Clarion Conferences.
Did you miss Piers Bearne's session at Agency Growth Events Season ONE?
Livestreamed over three virtual events in Q4 of 2021, Agency Growth Events brought together experts from the worlds of Digital Agencies, Media, and Management Consulting to talk about How to Grow a Digital Agency.
Watch📹 “Smart Value Creation” by Piers Bearne, Collingwood Advisory.
