Interesting discussion at a workgroup this week, which followed a theme from MDHUBAlpha. What is a serious expectation of growth for our businesses both in the current climate and going forward. We have seen MDHUB members achieving serious growth rates of 50%-150% per annum over recent years but is it realistic to hit an exit target of £5m-£10m over say, a five year period.
Many entrepreneurs have set up businesses in the last 10 years with a very specific "build and sell" model, I'm pretty sure that what would have to have been extremely strong business models, specialist market niches or just brilliantly marketed companies will now have to be truly exceptional businesses to fulfill that dream over the next few years.
The other angle of the discussion was not new, but perhaps being re-visited, the changes needed to move from a £500k turnover company to a £10m turnover company. The key thoughts being: How do we keep the atmosphere, the small company enthusiasm, the personal customer service and what kind of management team do we need? With perhaps a more focused question of - am I really the MD to do this move?
I know one MD who was absolutely rigid about his abilities - he could take a company from £5-£15m but after that he wasn't the right person. He had achieved it at least a couple of times but I could never quite get at what ingredients worked and what was missing.
So is the time right for "build and sell" or do we need something else?
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- The MDHUB is the premier peer to peer business growth network for Managing Directors and Senior Board Directors in the South of England. Solve your problems, lift the pressure, find ways through the blocks and grow your business with the support of the only people who really understand what you are going through - your own peer group of like-minded entrepreneurial Managing Directors. Our skilled facilitators make sure that the groups are a confidential, open and honest environment that supports you and gets you the help you need, whether that is problem solving or testing new ideas. We get to know you and your businesses extremely well, which means we can connect you with the right individuals or group but also, when needed, specialists from our network of fantastic advisors. Our hubacademy programme backs up your business instinct with a breadth of management training for you and develops your less experienced management team to support you.
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1 comment:
Interesting piece Phil. The current climate is certainly making MD's question their business models. On balance, I think that's a good thing. It makes you stop, think and evaluate other options, which might offer better long term value.
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