Managing growth

For many, achieving the American Dream means taking control of their destiny, quitting their 9 to 5, and opening the doors to their very own business. These brave entrepreneurial souls have shaped American enterprise, and today, they’re playing the very important role of helping to drive the nation’s economic recovery.

If you’re one of these brave souls—pouring your blood, sweat and tears into running your own business—there’s no time for rest. Once you’ve got your start-up off the ground the daunting task of growing your business to the next level must begin.

Growing a business presents a whole new group of challenges for entrepreneurs. The good news is that most businesses experience the same or very similar challenges when it comes to growth. There is no need for any entrepreneur to reinvent the ‘growth wheel.’ You just have to be willing to learn from those who grew before you.

I recently studied 54 high-growth entrepreneurial companies based in 23 different states, all of which were designated as successful growth companies by leading magazines or accounting firms. These 54 companies operated product and service businesses, had been in business on average 9.6 years, and had reached an average revenue level of $60 million with the range being from $5 million to $350 million.

Some of them, such as Eyebobs in Minneapolis, Trilogy Health Services in Kentucky, Defender Direct in Indianapolis, SecureWorks in Atlanta, and Mellace Family Brands in California, were well-known companies. The research was supplemented with case studies of other successful entrepreneurial growth companies like Room & Board in Minneapolis, C.R. Barger & Sons in Tennessee, and Enchanting Travels in India.

What I found was that these successful companies all faced very similar challenges when it came to growing, but what sets them apart from those companies that didn’t survive or didn’t reach the same level of success is how they approached that growth.

The companies in my study understood that growth is change and change is risky. Entrepreneurs who understand this and the challenges that come with it are the ones with the best chances for successful growth.

Read on to learn more about the top growth challenges facing today’s entrepreneurs.

About the Author

Professor Ed Hess

Edward D. Hess is author of Growing an Entrepreneurial Business: Concepts & Cases (Stanford University Press, 2011), and is a professor of business administration at the Darden School of Business, University of Virginia.

Hess is the author of nine books, over 60 Darden cases, and over 60 articles. His work has appeared in over 200 media outlets around the world including BusinessWeek, the Washington Post, and Financial Times.