As entrepreneurial firms grow and validate their value proposition, they turn their attention to four major areas. These are called the “4 Entrepreneurial Ambitions” and, in our experience in working with dozens upon dozens of entrepreneurial teams, all four become increasingly important as the company grows.
It’s important to recognize these Four Ambitions because you cannot pursue all of them at the same time. This is they key to developing powerful strategies for entrepreneurs – ideally, choose only one ambition over a given period (say, yearly), and vigorously pursue that ambition through utilizing the 10 Entrepreneurial Strategies (more on that later!). The more focused you are on your strategy, the higher the chances you will actually realize that strategy. But, what are they?
Faster Growth. This ambition is seeking to create strong top line growth for the company. This is typically an early stage ambition for entrepreneurs – seeking to drive revenue and gain solid sales along with a strong sales pipeline. Typically this means sacrificing profitability (spend money to make money, right?) and also pushes the team to their limits as you are demanding more from them causing potential burnout and an imbalance to their work/life balance. This is a very effective ambition early on but is not sustainable – expecting double-digit growth year-over-year is not only unrealistic, it is downright dangerous to the long-term health of the company!
Greater Profitability. This ambition is an attempt to drive the bottom line and realize stronger profitability. Once strong growth is achieved, entrepreneurs must turn their attention to the bottom line. This typically involves strategies around processes and efficiencies in order to drive profitability. Remember, it is very, very hard to pursue both faster growth and greater probability at the same time. Eventually, after growth has been achieved, attention to bottom line health must kick in. This is also incredibility important toward team health – the team has fought hard for growth and now seek some sort of reward for this. And, greater profitability is the way to share success with the team. This ambition is typically pursed after a few years of strong growth and most entrepreneurs feel the need to pursue this ambition realizing profits are eroding.
Engaged Staff. This ambition typically spans the entire lifecycle of an entrepreneurial company but doesn’t really fully kick-in until both Faster Growth and Greater Profitability has been realized. This ambition is all about seeking greater team engagement and a focus on a culture that attracts and retains the best talent. To achieve this ambition, entrepreneurial leadership teams must focus on building a powerful culture focusing on empowerment, meaningful incentive opportunities and advancement and training opportunities for the staff. Again, this ambition is incredibly hard to pursue if the company is fighting for sales and the bottom line is suffering. That’s why this ambition is typically pursued after a few years of company-buldling.
Increased Freedom. The final entrepreneurial ambition is an interesting one. Titled, “Increased Freedom” this a nuanced ambition as not one definition applies to all entrepreneurial teams. In our experience working with dozens upon dozens of entrepreneurial teams, we’ve witnessed a few different types of “increased freedom” ambitions. Some entrepreneurs seek personal freedom from working “in” the business all the time and want to elevate to working more “on” the business. Some entrepreneurs definition of “increased freedom” is elevating their leadership team giving them opportunities to delegate and, again, work more “on” the business. Other entrepreneurs define “increased freedom” as either a full or partial sale of their business – some engage private equity firms while others look for an outright sale of their business allowing them to take money off the table. Either way, this ambition is typically not pursued until the first three are achieved.
Whatever ambition you decide to pursue must fit the company circumstance and matched with appropriate strategies to achieve that ambition.