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- How to Minimize Risk and Grow Your Business Responsibly - October 9, 2019
Being a business owner is one of the hardest, most stressful jobs, and every decision can feel like it’s “make it or break it” for the chance at success. The goal of nearly every startup is to expand its business to serve more people. The question, however, is what expansion strategy to pursue. Whether you’re making a new round of hires or scaling substantially, how do you help your company grow responsibly?
With my experience as founder of Kango, a rideshare company for kids, I’ve learned how to grow a business responsibly, and I want to help other entrepreneurs and small business owners do the same.
While every business is different, here are a few pieces of advice to guide your company into a phase of responsible growth.
Build expertise and reputation
By building your expertise, your startup will be able to gain notoriety within the industry. Inside your own company, focus on building credibility and trust in all of your operations, and you’ll see the results will speak for themselves.
For Kango, I knew that transporting the world’s most precious cargo (children) meant safety and trust had to be paramount. Ridesharing for kids requires adhering to strict procedures, excellent customer and driver communication, and responsible growth in order to create trust with parents and to ensure safety for child passengers.
That’s why Kango has focused on deepening our roots within the California community, rather than rushing across the country for our expansion efforts. After increasing Kango’s coverage area by thousands of square miles, we’re helping more families balance work, life, school, and other activities. We accomplished all this while prioritizing safety, reliability and trust above everything else, and that’s what keeps our customers loyal.
As you look to expand your own business, do a reputation audit beforehand to make sure the climate is right, both internally and externally, for a major change. If you have the trust of both your employees and your customers, growth feels more natural.
Find out what your customers want
Demand is your guiding compass throughout the scaling process. You should actively solicit feedback from your customers: What do they need from your company? Do they want a greater variety of products? Do they want more of the same?
If you base your business decisions on what customer insights show you, you’ll find yourself on the road to responsible growth. I started Kango as a working mother who was struggling to balance work meetings, school pickups, extracurriculars and more, so I built a solution that would help other working parents with the same challenges.
First, I asked friends and family if they would ever use an “Uber for Kids” service, and what they would want to know about the service before, and while, using it.
Doing market research and customer surveys are key; acting on insights from those will align your business goals with customer feedback.
Look at market trends
Just because you have a good Q3 does not necessarily mean you should rush into Q4 with plans to triple your staff. You need to analyze the market to understand your company’s performance within context. Did everyone have a good Q3? How did your customer base evolve during that time period, and where?
Your company operates in a complex ecosystem of interworking parts. When it comes to growing your business, you need to make sure you’re staying abreast of trends within the markets at large. Otherwise, your competitors may see an opportunity that you’re missing. Conversely, remember that trends don’t last forever. Making hasty moves just because the market swings one way momentarily can backfire in the long run.
Weigh your options. Some risks are worth taking, but be sure that your decisions align with and support your long-term goals.
Work with people who believe in your values
While fundraising for our expansion, I had many meetings with investors, and not every fund or strategic investor was right for our company. All investors are logically motivated by the prospect of their return on investment, but when it comes to the product itself (a service transporting children), families come first, and investors come second.
I seek to work primarily with people who align with my personal values and my company values. With a value-add investor, you’re not just looking for cash resources; you’re looking for an advisor and business partner who can help you over the course of several years.
For example, our strategic partnership with National Express allows us to provide supplemental ridesharing in school districts where children would otherwise have difficulty getting to school. Always evaluate the opportunities that potential investors bring to the table, to ensure those opportunities are a good fit for your vision.
Overall, there’s no guaranteed way to ensure responsible growth. However, if I had to boil it all down to one piece of advice, I’d say stay true to your company’s mission.
I created Kango to help busy families realize their full potential by providing safe rides for kids, and that principle has guided all of my business decisions since day one.
Growing a company involves more than just having a good idea. To succeed, you need to be prepared for every step along the way and be committed to seeing your vision through. Starting a business always has an element of risk, but with enough careful thought and prioritization, you can minimize risk and maximize the likelihood of responsible growth.