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How to scale your firm

By Matt Newing is founder of Elite Group and an angel investor in the digital, IT and telecoms sector

When I founded Elite Group in 2000, I had just two members of staff. Today, our turnover is more than £56 million. Whether or not your ambitions for growing your businesses are on quite the same scale, there’s a lot I’ve learned along the way, and I hope the following tips will help others to grow their business successfully, and highlight some common pitfalls to avoid along the way.

Surround yourself with brilliant people

Improving the skill set and knowledge of your business is key to driving growth – and you won’t achieve that without employing people who are better than you. As well as making sure that things run smoothly on a day-to-day basis, a team of excellent people will foster the innovative approach you need to keep a competitive edge.

Two key recruits are a competent, commercially-minded accountant and lawyer. There’s no substitute for hiring an expert when it comes to your business finances and legal matters, and this should be prioritised if you don’t have this support in place already. They don’t need to be in-house, but rather at firms that know your industry and market well. 

If your plans for growth include acquisitions, it’s important to bear in mind that the people you take on are a crucial part of that transaction. Your staff and consultants are your best asset, so choose them well, and they will play a big role in your business’s success.

Overfund your business

A major inhibitor of growth is a lack of cash. When we came to make our second acquisition, our bank said we couldn’t invest our savings from our reserve account and that we would need to renew our existing facility – in other words, borrow more money and pay an additional, new arrangement fee. 

I had already shaken hands on the deal, so I couldn’t back out of it. Instead of being beholden to the bank, we decided to put all of our life savings in and pay off the bank to enable us to complete the deal. Subsequently, we changed banks to one that has been a true partner.

Focus on making money

It may sound obvious, but your business must make money to pay your staff. You may sell an exciting new product, or your business may be on a mission to change the world, but never forget that business is about making money to pay people. 

Have clear and realistic objectives

Is your ultimate goal to sell your business? If so, you should be thinking about what the minimum value would be for you to sell your business. Beyond this, there are a number of tough decisions to make – from what role and control you want post-exit to what will happen to your staff – so knowing your options and thinking them through beforehand is critical to ensuring you make the right choices in negotiations.

Dress your business for sale

 Moving on from my previous point, if you’re looking to sell your business, or to attract investment, you need to identify what is great about your organisation. Are you outperforming the market in any areas? Do you have any IPR that could be scaled?

Don’t underestimate what a difference presenting your best attributes as a business can do when making it more attractive to potential buyers and investors.”