A valuable business lesson from Piers Linney – Dragons Den

I recently attended the Festival of Enterprise in Birmingham, and Piers Linney was speaking.

As you can imagine, his talk on ‘5 key growth factors for business start-ups & business scale ups’, was the busiest talk in the room.

I’ve decided to share his lessons with you, and I massively encourage you to watch more of his videos and inspirational talks on his YouTube channel if you’re like me, a fairly new business OR you’re about to make some serious growth changes in your organisation.
You can access his YouTube channel here.

Now onto his 5 key growth factors…

1) Planning

Far too many businesses don’t plan. That can mean

a) There is no financing in place – do you have an idea where your monetary foundations will come from, what is the basis for achieving capital, how will you secure more investors? What stages in your business’ growth need what defined amount of resource

b) What about the right people? If you are a tech start up, it’s smart to employ a range of people with the right skills for now, tomorrow and beyond

c) Policies and information security. Have you considered the various ISO accreditation you may, or will need. What about the role of investor in people? Are you fully up to scratch with GDPR?

  • Having a clear destination, a clear goal, is crucial. What does the future state look like? How you get there is your planning, and without it you’re likely to get lost
  • Aligning your team to your plan makes achieving your goals more realistic and generates the culture of teamwork and hard work
  • Planning and goals give you a framework to make decisions against
  • To put it simply – If it doesn’t get you to point b – don’t do it.
  • Don’t expect there to be smooth, non-obstacle laid journey to your goals – the plan needs to be the ultimate direction

There are types of plans:

1) Do more, e.g, sales which means hiring more people or investing resource – ensure adequate systems and processes to deliver ROI

2) Merger and acquisitions – acquiring competition to grow, how do you choose the competition, what advisors, processes and systems will support this?

3) New markets – what products or markets should be entered? How can you understand the local culture and operate in the new area or market?

4) New product development – how do you encourage ideation, what investment is needed, how will you mitigate risk?

You can take any route and do anything but don’t do it if it won’t get you to point b.

Analyse the plan… and fix it as you go, but just get started.

With growth comes risk… but a plan minimises it!

Watch his 8 minute video all about planning here

2) Operations

Don’t have the pantomime horse effect! Make sure everything is connected. Make sure all systems are in place before you grow other wise it will cost you more in time. Time is money.

Peoples, teams, policies, systems. Compliance etc. must be built into your plan. Growing your business is fantastic, but without customer service, technology and other back-end support will mean your business can slow down, and not capitalise on new customers, and lose existing.

Automation – consider how you can digitalising existing processes, consider APIs to connect your different systems such as CRMs, marketing, sales etc. Run your business as a whole, not in silos. If it makes your customer delighted, and supports your growth, do it. This can support consistency.

Investment is likely, so measure what you need, when and a cost benefit analysis to ensure that the money placed in the operations can lead to direct benefit – when is this, and how much value will be realised?

Be agile and adopt the systems and processes which can support your business to pivot when needed as the market changes.

Think about connectivity – both literally in terms of broadband infrastructure, but also communication systems to support collaboration. Give your team the best culture to grow, know where to go for information, and succeed as one.

Security – consider the compliance and steps to take to ensure that your customers appreciate your business treats their data as if it was your own

Watch his 10 minute video all about operations here

3) People

Recruit from day one as if you really mean it. Don’t recruit friends and family because they have a skill. You meet to recruit smartly and you need to structure your recruitment plan so that you don’t get burnt. Don’t hire people just like you. Varied background, knowledge, culture, beliefs gives you a much greater pool of content. If someone isn’t working. Don’t be too busy to change it. Get rid and move on!

Finding the right people is become increasingly hard – look for the people to build and then scale your organisation with.

The harsh reality is that you will need to take a long hard look at the people around you. If you’re going from a start up to the next level, do you have the right capabiltties for future growth? Skills, experience and expertise is needed to get your business to the next level.

Be open  – talk to your team about the future, what skills do they have or need, is there a role for them elsewhere or do you need them to scale up

Some won’t want to grow and change with you. Acting sooner is better.

Start ups typically have jack of all trades, but as you grow, you need specialists more often than not.

Similarly, if you have an experienced team that are comfortable, they too might not be the right people to support your aggressive growth plans

Also, as a business owner, you need to ask if you are the right person to run it. Do you need an advisory board or senior support team like vice presidents? But the day might come that your business outgrows you and you’re not the right person.

It’s important to know how to manage talent – young or experienced.

There’s only so far that you can keep hoping people will deliver, but change is sometimes needed if not performing

Ambition is key – find the right people to match where you are at in your growth

Ensure your team know the culture, the plan, what you expect, and you let them contribute

Be diverse in the talent you employ, and be flexible with hours and structures – creative with compensation and benefits

Watch his 12 minute video all about people here

4) Finance

Financing debt is a mortgage.

Get investment from people who care about you and know you. Make sure you only take debt if you can service it! Understand your options before you take the chance! Opportunity to raise cash is enormous.

When raising finance, consider:

  • Planning: don’t leave it until the last minute, it could be an IPO or extended overdraft – you need to think this though. Due dillgence will be completed by your investor, they’ll look at legal information, financial information, your policies etc. Explain your business plan to them, how to return their investment. If private equity, what is the exit plan? When will you sell or float on the stock market?
  • Stakeholders: Be open to the increased work involved with financing, e.g. reporting. You’ll need to add these people to your board, and be open about your performance knowing that the investor is in the meeting.
  • Contractual relationship – what control will the investor have, veto rights, consent rights, repayment terms, involvement in decisions, information access. Don’t just enter a contract because you need finance, consider the full impact
  • Know when to accept – sometimes it’s not right to accept finance, so consider whether the time is right and the nature of the offer
  • Options – crowd funding, private equity, loans etc. – where do you go for information, do you have an advisor to help you? Don’t just talk to the bank for a loan.
  • Innovation – finance wants to invest money more now than ever, so securing funding may not be as unlikely as you think
  • Structure – think about the cash flows, repayment dates etc
  • Time – the process is not simple, and will require a lot of effort and investment of time, can you do this or is there someone who could on your business’ behalf?

Watch his 19 minute video all about people here

5) Technology

Technology effects all of us. Lots of opportunities but lots of threats too. You all have to move up the value pyramid to the top. You can’t just look at a year ahead you have to look at ten! Create real value at the top otherwise everything becomes automated! Automate everything. Integrate technology. Save time. Stop wasting time on manual labour! Use technology to bring content in. Connect online.

Technology can change your business for the good – are you considering the role it will play in the future?

  • Automate as much as possible for your business – customer service to CRM to accounts
  • Take out costs and optimise your business – think about every line in your management accounts, the costs, and consider how technology can reduce the cost
  • Everyone can access technology – so there is no longer a clear competitive advantage for larger companies who can access technology
  • The cloud enables your organisation to cut down the cost of running technology on premise – no hardware needed
  • Gigabit broadband provides ultrafast speeds and increased liability to move your business online
  • Remote working – a great way to reduce operating costs, and attract the right talent. Reduce cost of needing large offices
  • Technology can be leveraged to improve your product, your marketing, your salesforce, your customer service – make your customers happier
  • Collaboration and sharing of ideas makes it easier to grow your business
  • Consider outsourcing projects and leveraging external expertise
  • Security – you need to use the right systems and processes to ensure that your business and customers are protected. Who needs to access your systems?
  • Creativity is crucial to success – technology can support, but humans remain important to innovation, messaging and making connections with your audience

Watch his 17 minute video all about technology here

I’ve now completed 4 full months of running a business and I’m proud to say that for a start-up:

  • My systems and processes are in place
  • My finances are totally under control
  • I’ve found very smart people to work with
  • I have a solid business plan with measurable goals (which I’m ahead of!)
  • My chosen technology is 100% up to the job!

Marketing is my forte, but I have strengths in business strategy and building successful teams and processes too. If you want to have a chat, give me a call – 01926 423170