I wrote recently about the businesses I can’t help, so I thought it was only fair to write about whom I can help.  It’s tempting to write this as a sales pitch, but I’ll resist temptation and try to be more objective instead. My strap line is that I help small businesses who want to be bigger businesses.  I specialise in businesses with less than 30 employees because the smaller businesses are the sexy exciting ones. The businesses where I can make the most difference are the ones where the owner is committed to growth, and knows that he or she needs some help and support to get there.  Where the owner wants to get to be a bigger business, but doesn’t really know how to go about it. Imagine a two-person design partnership.  They’ve developed some demand, and have some good clients, but they are uncertain how to move from doing all the work themselves to being able to manage other people doing the work.  If you’ve read any of Michael Gerber’s Emyth books then you’ll know that there’s a key growth stage in stopping doing the work yourself, and getting others to do the work, while you become responsible for developing and running the business.  The temptation for our design company is to carry on doing all the work themselves, getting more and more worn out by servicing clients, or by not spending any time on marketing, they risk running out of new business.  Or both. In this situation I can:

• Identify what sort of work the lovely designers need to go after
• See what how they need to price their work to remain competitive, but have enough to be able to afford to pay other people to do the production and improve their profits
• Help them work out what marketing activities are going to work best for them
• Refocus them on marketing, so they can attract new clients
• Make sure they do the marketing, by being there and reminding them of what they promised to do

Of course, my lovely designers could do all of this themselves, but what do they get extra by paying me to help them? I’d say they get:

• The courage to charge more money
• Some fantastic new ideas about marketing, which they maybe wouldn’t have been able to come up with themselves, because I spend all my time seeing what works and stealing other people’s tactics
• Someone to be accountable to – so they can’t just slip back to their old habits, but are reminded that now we’re doing business in a different way.
• Someone who gives a damn.  This sounds obvious, but how often do you have someone who actually really cares about whether you succeed or fail, and have that person be someone who knows what they’re talking about.

Let’s take another scenario, this time of a bigger business.  Here’s a company which has been running for a while.  They have 12 staff, so they’ve got over the delegation issue, and they’re nicely profitable.  But, the director knows that she doesn’t want to spend the rest of her life running this business – at the moment it’s still fun, but she wants to sell up in 3 years time.  And, she wants to have enough money to do something else after that, or to do nothing at all for a while.  In fact, she knows that she wants to sell for upwards of £1.5m. Why would she want to get the woman with the curly hair and glasses in? Our director (we’ll call her Alice) needs some help to achieve her target of a sale in 3 years with a price tag of £1.5m.  Where I can help is:

• Assessing how much turnover and profit she needs to bring in to make the business worth that million and a half, and make sure that the business is working in a way which will maximise the sale value.
• Working on a much bigger marketing strategy to build up the business
• Helping with the recruitment of a really hot sales director to bring in the big sales which are going to add up.
• Supporting Alice in all the little problems that come with growing a business, so she’s got someone to go through things with her.  Again, this is about giving a damn, and getting help from someone who has been through this themselves.

That should give you an idea of the sort of businesses I work with and how I make a difference.  If you would like to talk about how I can help, you know where I am.

When you want to grow your business, you often need money. Maybe you need money to buy new stock, do some marketing, employ new staff, do some more things.  The banks are reluctant to lend to you, because your balance sheet is looking a bit weak, or you haven’t got enough money yourself to match their lending.  So you want to get some cash from an investor, in return for a share in the business.

An investor is effectively buying equity on the basis that if they give you some cash now, eventually their share of the business will be worth much more.  So if someone were to invest, say, 50k in your business, they’ll probably be thinking that they’ll want to get between 75 and 100k back in 3 – 5 years time.  A better return for them than putting their money in the bank, especially with today’s laughable interest rates, but much more risky.

Things to ask yourself are:

• Do you want to end up with a smaller slice of a big pie, or a big slice of a tiny pie? My experience is that the business owner always wants to keep as much of the business for themselves as possible, but this isn’t always sensible, as a lack of cash in the business means that you’ll always have a little pie.
• What are the strings attached to the cash? If you’re getting money from friends or family, or from an investor who has previously run a business, there can be the danger that they’ll interfere with how you run the business.
• On Dragons Den, people are always looking for the dragon who can bring contacts, or experience into the business, giving you a boost as well as the cash. In real life, this is pretty rare, so you shouldn’t expect this from an investor.
• If you had 100k to invest in a company, would you invest in your company? What’s the likelihood that they’ll get their money back? What’s the likelihood that you’ll all make millions? Think about it from their point of view.
• How will they get their money back? It’s all very well to own part of a business that’s worth a million, but the investor wants to be able to spend that money in 3 years time. Think carefully about what they’ll eventually get back in terms of hard cash.

I’ve recently been asked for help by someone who is running a (sort of) social enterprise.  He’s been running a business, and on the side of this he’s been doing all sorts of community projects.  All brilliant stuff, getting young people involved, providing services to the community – I’m not going to be specific in case you recognise him, but there were lots of great ideas for wonderful things.

This guy had not planned things out, and unfortunately had started a business which was failing.  So none of the lovely things could happen, because there was no profit to recycle into the community benefits.

In order to run a social enterprise you need to put the enterprise bit first.  You have to run a business, sell things, make money and deal with all of the things that every other entrepreneur has to deal with.

I tell people all the time that making money is a good thing, because money gives you options.  For some (non social) entrepreneurs, these are options to make the business bigger, have lovely holidays, do more aggressive marketing or feel secure for once.  Social enterprises have a different set of goals – they need to make money to make a contribution to the community.

So making money, and lots of it, is even more important for social enterprises than your regular businesses. If you’re not making a profit you’re just a loss making business, just like all the other failing businesses, but you’re going to feel worse because you’ve set yourself these community goals as well as business goals.