This is it! The moment you’ve been waiting for through those long hours of working to translate a fledgling idea into a real business. You’ve got funding.
Whether it’s a traditional bank loan, VC funding, or revenue-based financing, you’re now poised for a new level of success. And that means more responsibility, more planning, and more work.
Luckily, it’s exciting work. So let’s get down to it. Here’s what you need to do now.
Define your culture
It’s well documented that start-ups often run into trouble in years three and four as they grow and become more institutional. Those that haven’t taken the time to define a core company culture have a much more difficult time pulling themselves out of this slump.
Having a sense of what your company is all about from the very start will make it much more likely that you hire the right people, inspire them to do good work, and maintain agreement about why you’re all doing the work.
Companies should opt to define their culture in terms of values (the company’s why) instead of around the things they produce (the company’s what). A values-based culture will act as guide to decision-making at the highest levels, allowing everyone in the company to see an internal logic to management, which will increase their long-term buy-in and satisfaction.
Now that you’ll be expanding, you’re going to need help. It can seem like an un-sexy task to hire people, which can tempt you to give the process short shrift. Don’t make this error. If you treat hiring as an annoying after-thought you’ll end up with people who don’t value your business.
You need to make bringing in good people who are invested in your company’s success a top priority or you’ll live to regret it, probably sooner rather than later. This is something you can’t necessarily feel your way through; do some reading on hiring practices or get some training in HR.
Find a way to convey your brand’s core values to prospects so you can easily filter out those who don’t get what you’re doing. Figure out what you are really looking for in a candidate, and be realistic about what those you hire will be able to accomplish in a 40-hour week. Think about how all kinds of diversity makes organizations stronger. Make sure to know the legal implications of how you talk to prospects and staff.
When you were a tiny start-up of one or two, maybe it was cool to spend a lot of time surfing free WiFi at the café down the block. Maybe you didn’t mind working from a corner of your bedroom or designing your website yourself using free software. But now it’s time to turn your start-up into a real business that others will recognize as a truly professional endeavor.
If you’re going to have an office, make sure it presents itself well to both your staff and to visitors. Even if you are going to be a remote team, make sure you have a place to work that is stable, presentable (even if just on a Skype call), and has all the bells and whistles an office needs.
You also need to professionalize yourself. It’s fine to be casual and approachable, but your staff are not your friends. Even those who are your friends are not your friends, if you know what I mean. You are a leader now, so start learning how to be one. Hint: Leading means inspiring others to do their best work and then letting them do it.
Be strategic about spending
Now that you’re flush with cash, it may seem obvious that you should start spending. And yes, the point of getting financing is to spend the money on your business. But it’s a mistake to treat the money in your pocket as an excuse to “go big or go home.”
You need to steward these resources wisely. Every penny you spend should be in service to growing the business efficiently and soundly. That doesn’t mean every dollar has to have a direct and corresponding ROI you can point to. But every dollar’s disposition should be well thought-out and deemed to be valuable to the larger project you’re building.
Sit down and create a detailed plan for how you can spend your new funding most strategically. Your investors will appreciate knowing that you have things in hand, and being accountable to them will also help you keep things on track.
Just remember that no matter how much funding you’ve secured and from whom – and no matter how much equity they now own — this business is still yours to make a success. With a little foresight and planning, you are poised for greatness with that financing at your back.