Launching a startup is a courageous step, so if you’re now looking to grow your startup business, congratulations!
Surviving the startup phase is a huge achievement, and the fact that you are in a position to grow should give you the confidence you can.
Although a lot of information is available regarding starting a business, not so much exists around growing it. Having a growth strategy is essential to ensure your business thrives.
To demystify how to enhance your business, our team has provided the answers to some of our client's most frequently asked questions related to growing a startup business.
How do I know I am ready to grow my business?
It is not always easy to know when your business is ready to take the next step in growth, whether hiring your first employee, partnering with an overseas distributor, or seeking investment; however, if the following applies, your startup is probably ready to move on to the next level:
- You are turning business away because you are at full capacity (although check you do not simply need to raise your prices)
- You have regular customers who are asking for different products or services or more extended opening hours
- Your cash flow is steady, and your profits are increasing
- The industry you operate in is growing
Trust your intuition and listen to it when your gut signals that it's time to take the necessary risks for your business growth. Explore Startups Magazine for additional valuable resources to fuel your entrepreneurial journey.
Do I need to revisit my business plan if I want to grow my small business?
Regardless of how comprehensive your business plan is, if you are ready to grow your business, you will probably need to revise and refine your business plan, especially if you seek investment.
Although the core values and reasons for your small business’s existence will remain stable, your goals must be flexible enough to take advantage of new opportunities that appear and unexpected challenges.
One successful strategy you can adopt is to diary 60-90 minutes a quarter to review and revise your business plan with your senior employees.
Where do I find the funds to expand my business?
Even if you bootstrapped your startup, unless you are turning over massive profits, you would need to take out a business loan or attract an investor to achieve your commercial ambitions.
Access funds via a loan
If you plan to access funds via a loan, ensure you have the loan agreement checked by an experienced solicitor before signing it. Business loan contracts can contain lethal traps for the unwary. You should always try to protect your interests by taking professional advice.
Receive funds from investors
The other way to get the capital you need to grow your business is by taking on an investor. This can be achieved through seed funding, where family, friends, and/or an angel investor provide the money you need in exchange for a share of the business.
If you have already been through a seed funding round, it may be time to seek Series A funding from a venture capitalist. We have written an extensive guide on Series A, B, and C funding.
When approaching investors, you must present a business plan and a pitch deck. The latter is a series of slides used to tell an engaging story about your business and answer any questions a potential investor may have.
A pitch deck should support your verbal presentation but contain enough information to be viewed as a standalone resource for your business.
What are the legal requirements for hiring an employee?
Hiring your first employee is a significant step and one that should not be taken lightly.
Before you place an advertisement, consider whether the position could be filled using a self-employed contractor or freelancer. If everything points to the need to hire a part-time or full-time employee, you need to ensure:
When you advertise for the position, the advert complies with the Equality Act 2010.
This means It does not discriminate directly or indirectly against anyone with one or more of the nine protected characteristics. The nine protected characteristics are: Sex, sexual orientation, race, gender reassignment, pregnancy and maternity, religion or beliefs, marriage or civil partnership.
You present your new employee with a Written Statement of Particulars.
Although you do not have to provide an Employment Contract, by law, all new employees must have a Statement of Particulars which includes details such as how much and when they will be paid and the hours and location of their work on their first day.
Your employment contract and staff handbook set out all the necessary terms of employment, including grievance procedures and anti-bullying policies.
It’s always best practice to have an employment law solicitor check that your contract and staff handbook is legally compliant and protect your interests.
If you have an employee share scheme in place, you have relevant documents to provide to a new employee.
Attracting high-skilled people is key to expanding your business. Offering an enterprise management incentive (EMI) or a growth share scheme specifically designed for small, higher-risk companies will offset the reduced salary you can offer compared with large, well-established organisations.
The above is only a small sample of employment law matters you must consider when hiring your first employee. To find out more specific information relevant to your business, speak with our expert employment lawyers.
How do I build my brand?
Growing your business does not necessarily mean taking on staff or launching new products; it may involve creating and developing a strong brand.
To achieve this, you must have a regular social media presence, a clear business vision and strategy, and intellectual property protections in place. It will help to save time and energy, counting on a sales and Marketing department to support your company on this journey.
Concerning the latter, if you have a unique business name, symbol, or even smell, it can be protected by applying for a trademark.
And if your intellectual property consists of a new invention, it is vital to patent your innovation.
Intellectual property is a specialist and often complex area of law. If you want to protect your IP and/or deal with an infringement, our intellectual property lawyers can help.
Should I work with a mentor or business coach?
Growing your small business can feel isolating as you must shoulder all the risk. Most entrepreneurs experience sleepless nights worrying about whether they are on the right track.
A business mentor or coach can provide a wealth of information because they have been in your position.
Having someone who can give you regular goals, and listen, to and evaluate your ideas is an invaluable resource worth investing in.
Several organisations provide mentoring and business coaching. Check out mentorsme, recommended on the GOV.co.uk website, to find out more.
Get legal assistance from LawBite
Expanding your startup to the next stage comes with risk. However, with a clear strategy, steady cash flow, and the right professional advisors around you, you can meet this next challenge confidently and successfully.
LawBite has helped 1000s of startups and small business owners achieve their commercial ambitions. To find out how we can support your business expansion and provide affordable and accessible legal advice, book a free 15 minute consultation or call us 020 3808 8314.
