By Ed Reeves, Co-Founder and Director of Moneypenny
As the old aphorism goes, from little acorns mighty oaks do grow. That’s certainly been true in our experience. In the space of 15 years, we’ve gone from a small start-up with three staff to a company with over 400 employees and building work now underway on a brand new £15m HQ. So, what are the secrets to sowing the seeds of a successful small business? Here are 10 of the most valuable lessons that I’ve learnt along the way.
1. Put people first
Your people are your business. The best products or services in the world will nosedive without the right people behind them. But that’s not to say that skill sets are everything. There are two types of people in this world: one with a great attitude and reasonable skills, the second with great skills, and a reasonable attitude. Don’t delay for a second; attitude wins every time. And once you’ve got that person, invest in them, hug them, praise them and love them! Recruitment is so expensive in every way possible. Invest in your staff welfare and environment and they’ll stay. Don’t underestimate the fact that staff happiness and retention lead as directly to profit as much as sales does.
2. Big ideas
The experts don’t always know best, so don’t be afraid to think big and act bigger. Are you in your business to pay your way, or for the big time exit? If it’s the exit, buyers will want to know that you achieved something that’s hard for others to recreate. Sometimes they’ll be very big risks, but don’t be afraid of failure. Fortune certainly favours the brave in business. We did it with our first offices (when we purchased 12,000 sq ft for only 15 staff at the time, because we were too new to lease large space), as well as by offering our services to large corporate firms, and opening in the US. Each venture gets less risky, but we know we need to keep moving forward – and fast.
3. Connect and relate
In many ways, the ability to establish and nurture relationships are two of the most important skills that any entrepreneur can learn. Think of it as chasing a potential boyfriend or girlfriend. If you’re passionate enough about them, you’ll keep on plugging away until they concede to a date. We did it with many governing bodies back in 2009. We now have excellent relationships with them, and as a result, dominate certain sectors. If we’d realised what those relationships would deliver when we’d started out, we’d have concentrated on very little else.
4. Money matters
The first thing that will cripple your business ambitions is cash flow. Manage it properly and your world will open in front of your eyes. Get it wrong and you’ll spend an eternity begging from bankers. Solve the challenge by being creative. Structure the business so suppliers take the load. Or manage customer payments. There are plenty ways of skinning it, but just don’t accept that old-school 60-day terms are the route to riches. They’re not. Our particular solution came from asking clients to pay in advance for Moneypenny via direct debit. We were confident we were so much better than the competition that people wouldn’t mind.
Get noticed. Even if you’re a rookie entrant or fear you’re out of your depth, being shortlisted or awarded for your achievements can be the springboard effect you need. Awards are a great way for you to focus on your business. However they can be extremely time-consuming to enter. The Queen’s Award is one of the best to go for and certainly has a huge amount of credibility, but save that entry until you’re established. As a startup, do try and enter something though. Awards help create a difference between you and competitors. They’re all about authority.
6. All about timing
So much in life comes down to timing. Know when to take action and how to spot an opportunity. Having started out as a supplier to small business, as we grew, we gained interest from larger outfits. Cue our outsourced switchboard product to support busy switchboards. Seize opportunities as and when they arise.
It’s easy to say ‘be one step ahead of the competition’, but in practice this poses more challenges. The key is to remain true – true to your corporate culture, mission statement and ethos. Getting caught up in a cat-and-mouse-game of one-upmanship will steer focus away from your goals.
You’re currently small and nimble, and by virtue of your size, you’re likable. So turn competition to your advantage. Although both goliaths, Virgin vs British Airways takes the biscuit for demonstrating this. Relative tiny upstart vs global leader. Virgin made so much of taking on the giant, but never was it mentioned that they had roughly less than 10% of the fleet size. They used BA’s backlash as a brilliant marketing tool. And in your business today, remember that people always want to speak to, the organ grinder. Your larger competitors can’t do that. Getting personal with clients is a stunning asset; milk it while you can.
8. Create. Create. And create some more
If there’s one thing that we’ll look back at in years to come, it’s the fact that we created some new things, things that were absolute firsts in the market and that reflected client needs, before they knew they wanted them. Our phone system, our app, our marketing processes, routing calls to individuals rather than in a call centre style, sending UK staff to New Zealand to answer our calls during UK night-time. None were moon landings, but all are reasons why our service stands out from the competitors. What people don’t know is that there are as many again which have fallen by the wayside. But only by constantly creating, and accepting the risk, will you find these nuggets.
9. Reflection and reward
The importance of moving forward should never be underestimated, but neither should reflecting on your achievements. Take time to look at your milestones, think about what you did well (as well as what you didn’t do quite so well), and reward yourself and those around you. Celebrating the small wins is the only way you’ll reach the big wins.
10. Give your business an uplift
Remember the expression ‘money off the top’. It’s something big companies do all the time, but smaller businesses struggle to get along with. In simple terms, it means giving a big slice to uplift. For example, when selling a property an estate agent may charge 2% commission, regardless of the value they generate. Instead, they could charge 0.5% of the value, then 10% of anything over the asking price. Why? The opportunity for high earnings drives suppliers and staff; the reduced risk for you means you’ll try and create ‘new’ more often. Don’t lose sleep when you pay the cheque out at the end though as you’d have gained nothing without trying at all.