Saturday, April 8, 2017

The Four Phases of Growing Your Business to Six Figures

The other day I was having a conversation with a friend.  She's an entrepreneur who's somewhat in the early stages of scaling her business.  The two of us like to discuss our short and long-term business goals.   In one particular conversation, I went off on a small tangent and elaborated on my philosophy of how a business should scale.

My philosophy isn't necessary the truth, it's just my opinion based on personal experience and studying the path of others.  Since our talk, I decided to put some more thought into my process. I felt it necessary to share because I know there is a group of you who are either working on developing your business or want to explore entrepreneurial freedom in the future.

Here are my simple thoughts on the growth goals you should consider establishing along your journey to become a successful entrepreneur.
Phase 1. Earn Your First Dollar
I've said it on this blog before, but THEE most important milestone you can ever achieve is earning your first dollar. It's critical because when you receive actual money, you mindset shifts.  Generating your first sale is that special moment when your business transforms from being a dream to becoming a living, breathing thing.  It's the validation you receive for putting in so much time and hard work.  I urge you to try to accelerate how quickly it takes to get to start earning by not spending too much time on researching and on other non-income producing activities.  Sure, there's a lot of upfront work involved that must be done but don't get stuck in that phase.  Move quickly to the point where you start earning as soon as possible.  Earning your first dollar should be your number 1 priority.

Phase 2. Earn Enough to Pay A Bill
Once you have earned your first dollar, now it's time to get serious.  The very next goal on your list should be to earn enough money to pay a monthly reoccurring bill.  That bill could be pretty much anything.  But when your business generates enough, on a monthly basis to take care of some of your basic necessities, you're definitely moving in the right direction.  Earning your first dollar is one thing, earning regular income requires a bit more dedication and consistency.  You'd have to be working on it day in and day out.  It's a daily grind but you're seeing the results of your efforts.  Keep going.

Phase 3. Replace Your Income
The biggest dream all entrepreneurs have is to be able to support ourselves from the money we earn.  This is the ultimate form of validation.  Not everyone will get to this point.  The reason for this is because there's a different level of effort required.  For some, their biggest mistake they make is continuing to treat their business like a part time endeavor.  So it continues to provide part-time results.

Having a business that replacing your employment income may require the following:
1. A (much)greater investment of your time.
2. Working with coaches who can help you determine where to focus your actions.
3. Scaling of your efforts.  Examples of this include increasing how much you spend on ads or outsourcing tasks to professionals instead of doing everything on your own.

Basically, if you want to replace your full-time income, you'll have to transition from being an amateur entrepreneur to becoming a pro.  Going pro means leaving your amateurish ways behind.  Steven Pressfield talks about this concept in his book Turning Pro.   In his words, "when we turn pro, we give up a life that we're comfortable with. Turning pro is free, but it demands a sacrifice."

Your business becomes a priority.  You miss out on the normal things in life like weekends with your girls or sleeping in.  You scale back your lifestyle spending so you can funnel money into growing your business.  Whatever it takes, you make it happen.

Phase 4:  Running a 6 Figure Business.
Most of the small business coaching programs out there lure in potential clients by alluding to the fact that they can be running a six figure business in less than a year.  Scaling your business to more than $100,000 a year is a huge victory.  But not many people get there.  We're so used to operating like a small business that we have a hard time growing the business to new levels.  I personally think that a six figure business, while impressive, is only the beginning.  To me, this demonstrates the potential of the business.  You should quickly want to grow to multiple six figures ASAP.  A multiple six figure business (hopefully) brings more money to the bottom line.  Which means more money in your pocket.  Once your business reaches six figures, your next objective is to determine how much it needs to earn for you to generate a six figure salary.

This a simplistic rundown that doesn't go into great detail but it's a start.  With each phase of growing your business, you have the privilege of studying others who've reached the outcome that you desire.  Learning from and replicating their strategies is probably one of the best tactics for rapid growth.

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