The High Growth Business
This would be those businesses that decide to expand and risk into several locations or new markets regionally, nationally or internationally. Business owners that decide to expand through franchising or owning several locations fit here. A manufacturer, distributor, wholesaler, service organisation, professional group, retailer, or any other company or group (could be co-operative crafts group) that decides to work the much bigger regional, national or international market through agents, distributors, affiliates, partners, direct marketing, tradeshows and e-commerce type marketing would usually be viewed as a High Growth Business. These are more complicated businesses to operate.  The risks and rewards are bigger and larger numbers of employees, suppliers and affiliated businesses and personnel earn income from the High Growth Business. Community or Generic Businesses often expand into becoming a High Growth Business. Ambitious entrepreneurial types and new ventures established by large High Growth Businesses will often go from the Concept Stage to the Take-off Stage straight into the Ambitious Stage of expand and risk in a very short time. This takes capital and expertise. Many High Growth Businesses often become public companies listed on the Stock Exchange or are bought by or merge with larger companies.

Advantages:

•    The continual challenges of continual change, new markets and new opportunities creates ex-citement and energy in your life especially when you are succeeding. Some people live off those feelings.
•    In a High Growth Business once you’ve achiev-ed momentum it tends to multiply its success quickly.
•    The opportunity is much greater for wealth building through large income opportunities

• Wages, bonuses
• Profit share
• Listing – going public
• Mergers
• Selling to another company

•    Though strong cash flow, partnership, alliances, investors, financing and networks, you usually have the capital to expand and take advantage of the bigger opportunities.
•    Your decisions, research and actions are often backed by a professional team of marketers, financial experts, legal people, technical and HR people that increase your chances of success. You are not alone.
•    Because of your size and often your reputation you can attract, develop and keep top perform-ing people that can make the company successful.
•    If you are successful you end up with lots of media coverage and you become admired by the business community and public in general.
•    Large and powerful business, political and personal networks open up for you
•    Government, your industry and the community at large want you to succeed and will often help because of your contribution in the form of jobs and the success of the industry and economy in general.
•    High Growth Businesses usually have large amounts of money invested into its success by banks, investors, government, and suppliers to name a few. If problems appear they become part of the solution because they can’t afford for you to fail. “Owe a little, it’s your problem … owe a lot it, is everybody’s problem.”
•    It is a great opportunity to develop your leader-ship skills, business and entrepreneurial abili-ties at a phenomenal pace because of the size of the transactions, and the network of ex-perienced successful people you associate and do business with.
•    It is an opportunity to make a major impact and contribute to society and your industry and leave a legacy that will last far beyond your own working life.

Disadvantages:

•    The continual challenge of venturing into new territory and new opportunities can be very stressful if you always like to know exactly what is going to happen. Some people cannot live with the uncertainties.
•    If a company “runs of the rails” during a high growth period it has to be re-directed quickly, otherwise the momentum may take it quickly to a point of no return. Rapid growth is great if you are on track. If you are off track it can be destroyed quickly.
•    Especially during the growth and expansion periods there is a continual need for refinan-cing, raising capital through sales, investors, borrowing and bringing on strategic partners. This is stressful and tiring.
•    As the need for capital increases your position as a shareholder is often diluted. You run the risk of losing control, being replaced, bought out or pressured into a position or situation you don’t want to be in.
•    The company no longer exists just for you … you now need to fit into the business and answer to partners, board members and share-holders. It is no longer just “your baby”.
•    The business often requires lots of travel and time away from home in order to succeed or to correct errors created by others. It also requires the key people to put in long hours of work. Without this kind of commitment the business will not make it.
•    The actions or decisions by someone in another geographical location or division can negatively affect your cash flow and reputation.
•    You may have to change salary packages, in-centives and promises initially made to original partners, investors or employees because of new circumstances and new stages of busi-ness growth or decline.
•    Strong empowering leadership along with pro-per delegation of major responsibilities to other qualified people is needed in a successful High Growth Business. You may not have the skill to do this or just can’t or won’t let go of the reins.
•    Monthly overheads can extend far beyond what you personally can generate in income. This puts it beyond your control to pull the company out of tough unexpected cash flow “crunch” periods by yourself. In the early days of your business you probably could do that. Now you can’t. Can you live with that thought?

Due to the difficulty of bank based loans and the need for capital, cashflow, and investment you would likely go to friends and family for loans. We recommend you use www.kasu.ca in Canada.

There are three types of business ownership positions:

1.    The Lifestyle Business
2.    The Community or Generic Business
3.    The High Growth Business

This blog has been prepared by Ryan Anthony Gibson and the source is Bill Gibson’s Business Success Series by http://www.kbitraining.com