Are You Running Your Business Like A Lemonade Stand? : Under30CEO Are You Running Your Business Like A Lemonade Stand? : Under30CEO
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Are You Running Your Business Like A Lemonade Stand?

| February 6, 2012 | 9 Comments

On day one of your new business, you have a hundred job functions. Try to fit “CEO, President, CFO, Technical Director, Web Developer, Accountant, Sales Representative, Receptionist, Janitor” onto your business cards. To millions of experienced entrepreneurs, this feels like what a small business is always supposed to be.

Wrong. The problem is you. There is currently a 1:1 relationship between your work output and business operations. That’s your Growth Multiplier.

Think back to second grade, an age of lemonade stands and multiplication tables. That’s when we learned that you couldn’t change anything by multiplying by one, either in the classroom or selling sugar water by yourself on the corner.

An entrepreneur’s passion, drive, and intelligence can be a startup’s greatest asset, but for a company to grow, it must expand beyond its founders. The best leaders develop key systems and personnel and trust them to succeed, freeing up time for innovation and vision and multiplying their businesses’ growth potential.

So What Are The Key Multipliers?

1. Add a Super Assistant. Find someone you trust with your schedule, your customers, your money, and your life. Make them the hub between your business and the outside work and give them the power to tell you what to do, where to go, and when to be there.

2. Create a hierarchy of business functions in your job description, from lowest to highest impact on growth and profitability. Start at the bottom, and delegate like it’s your job. Because it is.

3. Forget the old corporate cliché of boring, slow HR departments. Hiring and developing A+ talent is a powerful engine for company growth. Hire and train well early, and you’ve built your future leadership team. Hire poorly or ignore training, and you’ll lose valuable time, customers, and profits.

4. Plan for explosive growth. The best businesses will grow too large for an entrepreneur to manage alone and linear growth brings exponential complexity. Mastering business growth requires an early focus on key operational systems. Consistently gather customer feedback for inputs into the product development process. Track key business metrics and attach them to an employee compensation plan.

5. Give away your corner office. Find someone you trust to run daily operations, and let them. Then go start your second business. Or sit on a beach. (Full Disclosure: I’m not here yet, but it does sound nice.)

It’s hard to scale a business using Growth Multipliers.

Only 21% of businesses in America will grow to 10+ employees and only 4% ever make $1 million in revenues. The average entrepreneur is most comfortable while manning their own little ‘lemonade stand’, living and dying with every sale. Fight this false sense of security, build your way out of daily operations, and become the leader and visionary your business needs. The payoff is immense, both for your life and the bottom line.

Neil Thanedar, 23, is Founder and President of Avomeen Analytical Services, a Scientific R&D Laboratory that uses advanced chemical and forensic tools develop new products and solve manufacturing challenges. Avomeen grew to over 10 employees and $1M/year revenues in its first year and earned Neil the title Generation Next Entrepreneur To Watch by CNNMoney.

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Category: Startup Advice

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  • http://twitter.com/CogentCoach Michael Nelson

    Great article Nate.  I would add to the list, somewhere near the top, establish your goals for owning a business and build/validate a business model to reach your goals.  This helps immensely when your looking to outsource or automate functions as you’ll have a clear idea where the high value actions are that need your attention.
    Michael 
    Business Coach
    http://thecogentcoach.com/wordpress

  • http://www.avomeen.com/ Neil Thanedar

     Thanks for the feedback! I would definitely include the development of a strong business model as a prerequisite for growth. I would also recommend that all business models be kept as flexible, living documents capable of rapid evolution.

  • http://thepeachdesign.com/ Peachanan Rojwongsuriya

    I always believe that I’ll soon have to bring someone to help me to manage my startup and move on to the next. Never got a chance to do so, as my startup can still be handled by myself. 

    When should I bring in others to help and move on? That’s the question i’m still wondering. 

    Any personal experience anyone wanna share and shed lights for me?

  • http://twitter.com/avomeen Avomeen

    First, figure out what leadership your business needs to succeed. In my opinion, most successful internet startups need three key factors covered: ideas, technology, and management. 

    Think Facebook. Zuckerberg covers ideas and technology, but has relatively weak management skills, so he brought in Sheryl Sandberg.

    What factors are holding your business value back?

  • http://thepeachdesign.com/ Peachanan Rojwongsuriya

    A ha! Thanks Neil. Great example too. It’s time to look into the future, what my goals are and what are the obstacles that is currently preventing to to reach those goals. :)

  • Andrewtoniok

    This is a great piece of information i come across this year. All the points are real and true to a startup. As a startup in the digital print technology, i have done point 1,3,4, and 5,  well for  2 can someone expound it better for me.

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