Context

Firstly, thank you to everyone that read the first in my series of articles on growing your business and connected to me, I really appreciate your support.

So, how do you break through the £1m (or $1m) revenue barrier? It’s one of the perennial questions asked by entrepreneurs on which everyone you talk to has a point of view. Unfortunately, unless the person you are talking to has actually done it, their view is at best interesting and worst, dangerous.

Firstly, let me provide some context from the UK:

• According to UK Government stats, in 2017 there were an estimated 5.7 million UK private sector businesses
• Of these, 5.5m (96%) were “micro businesses” with 0–9 employees
• Therefore, even if we are generous in the use of Pareto’s Law, that still leaves circa 75% of UK businesses with revenue <£1m

So, why is it that so many businesses fail to reach “escape velocity”? Some might say that they never wanted to achieve £1m revenue. Some might say that “it’s just too competitive”. Some might say “we tried loads of things, nothing worked”. The truth, in my experience is, that it’s a combination of things.

The following are my top 7 reasons that companies fail to reach “escape velocity”.

Poor timing

According to Bill Gross the single biggest reason that start-ups achieved stellar success was timing. That is not the same as luck, in my view, it means working out when to enter (or exit) a market is critical to your future success.

Wrong people

They fail to get the right people on the bus, with a common/clear vision of where they are going and all sitting in the right seats. The problem is, most entrepreneurs start their business with people they know, rather than those with the best skills for the job.

However, this is incredibly difficult to get right. You need people you trust to go on this crazy journey with you. But you also need people that know what they are doing with experience.

Lack of focus

You have limited time, money and people to do things, so the more focus you have, the more traction you get. Strip away all the distractions and focus on the core proposition/market.

There is a caveat to this; to discover your core proposition in the early growth phase, you have to “do a little and learn a lot, fast”. My personal approach is to find niches in your market that you know you can serve really well. Then, quickly build a proposition and test/pilot it with clients.

Working mostly in, not on the business

It’s an old adage but entirely true. You can’t (and shouldn’t) stop coaching your people on solving complex problems and contributing to sales/operations/finance, etc. However, spending 100% of your time doing this isn’t going to get you to £1m revenue. Ask yourself “what percentage of my time is spent thinking about where we are going versus running the business”.

Lack of a compelling, market tested proposition

Sitting at your desk writing a business plan has its place and is critically important. The act of writing something down should make you think hard about what you are planning to do. However, you must get feedback from potential customers about what you are offering, at what price and what the financial benefits are to them.

Little attention paid to building a reputation

Building a reputation for high quality delivery is the best way in a services business of creating a buzz about your company. This clearly leads to word-of-mouth marketing and referrals.

They gave up or wandered off into the weeds

There is simply no short-cut to breaking the £1m revenue barrier. You need lots of determination, tenacity, call it what you will, you just need to stick at it. You need to be constantly learning and adapting as you go based on market feedback.

However, there is a world of difference between evolving a sound business proposition and flogging a dead horse. You must remain open minded and take account of feedback from people you respect.

In conclusion

There is no silver bullet. If you are looking for one thing, and one thing only, that will hit the “boost button” for your business, stop looking!