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Listen in! Pick up some expert advice to a reader's question that we selected from CyberSchmooz.

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When Is The Right Time To Scale Your Startup?


When entrepreneurs start up businesses, they do so with the dream of building popular, successful brands. Sometimes, that dream clouds their vision and they do not wait for the right time to scale their startups. As an entrepreneur, you need to wait for the right time for growth. Entrepreneurs who do not attempt to reach their goals without a proper business model or processes in place fail to make their business dreams a reality. To avoid this outcome, find out when is the right time to scale your startup.


Enough Demand

One of the most prominent signs that you are ready to scale up your startup is that your products or services are in high demand. More so, you need proof that your products or services will continue to be in high demand. Many entrepreneurs get excited when their sales rates increase dramatically. The thought of consumers desiring your products or services is influential. It often leads entrepreneurs to scale their startups. However, if entrepreneurs do not do their research on current and forthcoming trends in the industry, their sales could end up dropping significantly after scaling up. To prevent falling into business debt, research the predicted market trends. Only scale up if your products or services are predicted to remain in demand.


Up-To-Date Technology

If you have implemented the latest revolutionary technologies, it might be the right time to scale your startup. The most successful businesses rely on technology to maintain a positive cashflow and grow. You need to implement digital marketing strategies to reach consumers who browse the web for products remotely. Your startup needs to guarantee customer information protection with top-of-the-line software. Every aspect of your startup should use technology to offer consumers what they want. If you do so, consumers will recognize your brand as a high quality company. Then, you can scale up with a good customer base and technology both you and your customers can rely on.


Achieved Startup Goals

Another sign that it is the right time to scale your startup is that you have already achieved your startup goals. Before launching your startup, set goals with your team and venture capital partners. According to Lee Jacobs of Angellist, “The relationship between the team and venture capital partners is crucial to successfully scale a startup.” There are advantages and disadvantages of partnership business which you have to choose which is best for your startup. When startups are focused on relationships, they can decide on how to best solve their customer’s problems. Make your goals both difficult to achieve, but realistic. By establishing realistic goals, you can recognize when your startup is moving forward to the next stage or target. Moreover, you can determine when it is time to scale up your startup.


Turning Down New Clients

When entrepreneurs start turning down new clients, it is usually the right time for them to scale their startups. If more and more consumers are coming to you for your products or services, what you are offering is in high demand. Entrepreneurs in this situation have two choices. They can turn down customers because they cannot handle all of the work on their own. This option entails remaining the same size and keeping the same amount of profits. Entrepreneurs can also choose to scale up and hire more employees. In doing so, they will increase their client base, make more money and grow their business. If the latter of the two options sounds better to you and your startup, it is time to scale up.


Strong Cashflow

On top of sales, you need to take your cashflow into account when deciding on the right time to scale your startup. If your cashflow is sporadically rising and falling, you are not ready to scale up. When entrepreneurs attempt to grow without a steady cashflow, they spend more than they can afford and cannot handle the larger business they built. Many times, entrepreneurs receive a sudden increase in sales. As a result, their profits receive a major boost and they choose to scale up. If those sales are not repeated, their cashflow will not remain high and they will, once again, fail to succeed. Scale up only when your cashflow remains strong and steady for a substantial amount of time.


In order to achieve your dream of expanding your startup into a profitable company, you need to understand when it is the right time to scale up. If your products or services are in high demand and are predicted to remain in high demand, it is time to scale. When entrepreneurs already have the best technology implemented throughout their startups, scaling up is a good option. Another sign is that you have already achieved the startup goals you set for yourself. If you are turning down new clients because of your overwhelming workload, consider hiring new employees. In addition, a strong and steady cashflow signifies that it is time to expand. Use these signs to know when to scale your startup.


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