Definition: being prepared to take on more clients without quality of work diminishing or potential to continue successfully as its size increases

Going from Start Up to BIG – communication isn’t as easy – and not as efficient

“Didn’t you get the memo”

When you have to say that = you’re not scaling well

Steve Blank is a venture capitalist, founded companies, and has a great blog on this topic – Steve Blank

Who HAS succeeded at scaling their business?

First: talk about employees they are a means to a goal – not the goal itself

Code Geek – web firm: himself alone at first

He did all: design and development and writing….. better graphics ability – networking, user groups in Denver, id people who were skilled

Hired freelance at first – now dozen 1099s – he needs NOW to replicate himself

Delegation is crucial – find the right person who has the skill set – who can clone him

Programming and can also talk to clients

He SHOULD be the salesman, always

ID point of pain – I’m not a designer – knowing what your limitations, where your box is

Whatever goes into that box, comes out as amazing stuff

Try to not be an assembly line – be creative – keep YOU in the product/service

a)      Who am I/what do I do well/what can others do better?

If an owner can’t go on vacation for a 6 months stint –  then it’s not really a business

Difficult tasks:

Accounting

Operations

Networking/Presenting/Sales

Web design

HTML

Marketing

Question: ought you to outsource sales of services?

Of products, yes.

The only thing you can’t outsource is OPERATIONS

Risk of growth – leader originally holds the red balloon (the vision) – as they grow the balloon gets harder and harder to see

Look at Home Depot and New Belgium – Corporate Culture – its embedded into the organization.

Chic’Filet – it’s my pleasure – that’s not REALLY their pleasure : welcome to Walmart

Keep the vision because that’s what we are passionate about – and translate that into future branches, it will be fail

Be the charismatic leader of the cult

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Another aspect: Why am I growing and what does the picture look like?

Am I a steady presence or absent leader?

Think about what you really want!

Don’t grow for the sake of growing – that’s what society says, get a loan and grow and grow and grow – that’s peer pressure!

Different levels of scaling.

How much of a hand in it?

How do you replicate yourself?

Look for people who are different – those who excel where you don’t.

Having two visionaries as partners – kind of a nightmare!

To get an employee you need an EIN, but you don’t have to be an LLC.

Rules of contract vs employees:

W9/1099 contractor – can’t dictate the span of control.

Ramifications: contact CPA – keep you out of trouble with the IRS but consider that there may be back Unemployment Taxes and Social Security owed.

2 must haves: a good lawyer on tap and a good accountant to do your taxes

Find an EA (enrolled agent) with the IRS they can represent you without being there!

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Hiring someone – options are limitless – take the time to hire a quality employee

Develop an interview process, an application form, look it up on the internet for sample questions, personality matches

Why do you want to have employees – ways to scale without never hiring.

Comes from strategic partnerships – those who do exactly what you do, and are complementary

RESOURCE: Erica (RedHeadWriting) – ODesk.com – do your admin while you are asleep

– concentric circles – more business but not expanding your services; more employees then

VS

- scaling your business – increasing your scope; get strategic alliances

OTHER:

Take time to find people you can work with and can support you.

If you can’t go on vacation, you’re failing at business

How can employees and contractors be invested with you – honor them in front of client, reward them, emotionally as a human being, how you manage them

Trust your contractors; but if you’ve done it right – they’re going to leave and do their own stuff – which is GOOD!

Price your services so you CAN scale – you have to be able to outsource, pay your vendors ½ of what you charge – if you can’t then raise your prices! OR send that vendor overflow!

Reward: energy to grow your business and be on your bike or wakeboarding.