Starting your own business is exciting, but knowing how to navigate the challenges will determine whether you make it in the long run. According to the US Bureau of Labour Statistics, nearly 50% of businesses fold within the first five years.
Every venture, large or small, goes through specific stages of development. Understanding them will help you prepare for the pitfalls, and plan effectively as you grow.
While there are many articles out there offering the theory of Business Lifecycle Stages, we surveyed small business owners direct, to give you a practical exploration of what they experience.
This comprehensive guide maps out the stages that you’ll travel as a small business owner, and highlights the most helpful tools you can lean on to make each phase easier. Our goal is to give you the insight and know-how to help you succeed, every step of the way.
Knowing where you are in the Business Lifecycle framework will ensure you don’t miss any crucial steps to boost your results.
To get the right help at the right stage of development, take the quick and easy Business Lifecycle Quiz.
Here’s a short overview of each business phase, to give you ‘the lay of the land’:
Now let’s explore these phases of business progression in more detail, as well as the tools available to make things easier, and boost your success.
You have a great idea, that light-bulb of inspiration is shining bright. Now what? How do you organize and develop it? Let’s look at brainstorming, research, and getting organized.
Initial planning will revolve around what kind of business you have in mind. Essentially, there are four main business types:
Some businesses may offer only one type, while other may operate all four models. Obviously, your business needs and challenges will differ depending on the model you adopt.
Once you have your product and service offerings clarified, you’ll want to do some market research to assess demand, plus see what competitors are up to. Also ask people you respect for feedback, as they may give you ideas or angles you hadn’t thought about.
Market research is one of the most crucial first steps, because if there’s little demand for your idea, or if the market is already saturated with exactly what you want to provide, you’ll have to rethink your positioning.
Learn more: How to Conduct Market Research for Startups.
Consider customer pain points, and how your product or service can solve them better than others in the marketplace. Ideally you’d want to carve out a niche, to stand out from the crowd.
You’ll also want to give careful thought to your pricing model. This may be a way to differentiate and appeal to customers, because if your competition is too pricey, or ties people in, you’ll have a way to quickly gain the upper hand. Ask yourself these questions:
A final tip in this area is to focus your research on how your competitors are doing their marketing, and what channels will best suit your intended audience. We’ll go into this more during the Build Stage.
It’s important to write out a Business Plan – this will make your ideas tangible by forcing you to clarify how things are going to operate. You can even use an AI Generator now to help out.
Many small businesses choose to set a strong foundation from the get-go by becoming a Limited Liability Company (LLC). It keeps your personal assets separate from your business.
That’s why we offer LLCs for free (just pay state filing fees). Becoming an LLC also let’s the world know you’re legit, not some fly-by-night popup.
Learn more:
The first step in branding is thinking about the instant impression you want to make that encapsulates your products or service and the type of audience it serves. It’s important to get your core brand vision into focus, a this will steer all your marketing assets, like your logo, business name, website, and messaging.
Here are some useful questions to get started:
Take your time with branding, it needs to be consistent, instantly recognisable, and tailored to your target audience(s). It’s also time consuming and quite costly to do a rebrand further down the road.
So get all your ideas down in writing, and bounce them with a broad range of people to gather their perspectives. Especially in the noisy digital space, you want to find a way to be distinctive, so you stand out from your competitors.
Learn more: Branding for Small Businesses.
Now that you have your ideas more organized, it’s time to build your brand out in the world. Especially the online arena, where you reach audiences 24/7.
Here are some tips and guides to help you make the right choices for your individual needs:
1. Hosting, Website, eCommerce
While web builders such as Wix are appealingly cheap and easy, beware price hikes in year two and beyond. The catch is they tie you in because you can’t migrate your website without starting the build from scratch, which most small businesses don’t have time for.
Learn more:
2. Social Media
We’ll explore this more in the Growth Stage section, but for now you’ll want to make sure you get your business setup on Google My Business and Meta (Facebook & Instagram), as the core basics.
Even though you may have lots of experience with social media for personal use, it’s an entirely different thing for business brands. Simply posting something new doesn’t get the job done, it’s all about planning campaigns based on specific goals, such as creating brand awareness, engagement, driving traffic to your website, or sales acquisition.
This video guide will help get you in the right mindset: How To Market Your Business On Social Media.
3. Email
Email remains a potent way to reach customers and grow your market share. And unlike social media, with emails you get to own your audience list, without worrying about losing views when there are algorithm changes. This is solid gold.
These days you’re spoilt for choice with platform providers. But make sure your selection is transparent, prevents spam effectively, has good customer support, and is focused on small business needs (some companies only put effort into taking care of larger businesses).
Learn more:
4. Content Marketing
Most people search for what they want using Google. Google is all about great customer experience, so it ranks businesses with blogs and good supportive content higher. For this reason, content marketing is a must. It’s also crucial for building brand trust.
Learn more: Content Marketing for Small Businesses: 9 Essential Tips.
Hooray! Your idea has been born, your brand is live for everyone to see and love. You should be proud. Now that you’ve launched your website, let’s look at the next steps to solidify your foundation.
You’ll be wanting to make sure you solidify your revenue, so your focus will shift more to trying out some tools and strategies that will get your business in front of a bigger audience.
Learn more: Beginner’s Guide to Business Marketing
With getting more customers in mind, your other priority should be ironing out all the big and small real-world creases in your business logistics – the last thing you want is your new brand to become tarnished by lots of complaints on social media because of product or service issues.
At this stage it’s very easy for business owners to wear so many hats they lose the wood for the trees. It’s wise to take the time to think on which activities are worth your time, and which you can delegate, like accounting and admin. In other words, the 80-20 Rule. Leveraging account reconciliation software can also streamline your financial management, ensuring accuracy while freeing up time for business growth.
Starting a new business has traditionally been hard, because you’d either need to find large sums of startup capital to pay for experts (agencies/staff), or somehow find the time to get good at a wide range of skills and activities, like:
Most of these are a specialization all on it’s own. As the saying goes: ‘Jack of all trades, master of none’.
Now for the good news. These days there are affordable digital software tools that do all the heavy lifting for you. These guides will help you understand what’s possible, find examples of what’s available in the Tool Tips section below:
The last thing you want as a startup is to lose out on sales and dent consumer confidence because your website has been hacked by cyber criminals.
Unfortunately this threat is no longer something only big corporations need to worry about, as small businesses are now viewed by hackers as low hanging fruit.
That’s why it’s a good idea to look into website protection. And it doesn’t need to be expensive, or complex. Have a look at the Tool Tips section below for an example.
Sometimes it can be hard to tell whether your business is a startup, or has matured past that phase. If you can’t answer any of these questions with confidence, your still in startup mode:
The Relate suite has been co-created with small business to serve their specific needs. They’re designed to get rid of the usual overwhelm, with low cost tools that simplify online marketing.
Most of the Relate products either have a free, 30-day offer with no strings attached, or a very affordable Basic plan. At this stage, it’s a good idea to try them out and judge whether they’re worth a place in your marketing budget.
Getting out in the world and networking is still key for business growth. Easily design your own business cards, so you can make a unique impression, without a big dent in your budget.
To prevent the risk of website downtime from cyber crime, SiteLock gives you reliable, hands-free security. But if the wors happens and your site does get hacked, bookmark this one-off Emergency Repair for a fast fix by reliable experts.
This is the phase that every new business owner dreams of – you’ve built your company, ironed out the main logistical gaps, started to optimize your workflow, and have a steady cashflow going. The sapling is now a young tree that can’t be easily blown over, it’s ready to really spread it’s branches.
Now you’ll want to significantly increase your profit margins. This will take a strong focus on the marketing side, to grow your customer base. To accommodate this expansion without losing product or customer support quality, you may also need to do some upgrades.
The growth stage is a time when you need to be selling your brand to the world. It may be hard to give up the reins of some granular stuff like admin, but every successful business owner needs to learn to delegate, or you won’t be able to bring your bigger vision to fruition.
Outsource as much as you can to free yourself, because now your focus needs to be on getting new customers, and perhaps also impressing potential investors. It’s may be wise at this point to hire an accountant, and an assistant or office manager to handle all the small day to day things that can easily eat up all your bandwidth.
Growth is all about having a strong vision, and that takes fleshing things out in writing, not building castles in the sky. Now is the time for some serious strategy.
Learn about the most important marketing techniques, and build a robust Marketing Plan:
A common newbie mistake is setting up marketing campaigns, but failing to measure them. Performance data (metrics) is pure gold – it will show you what type of marketing is successful with your target audience, and where there are weak areas to improve on.
Learn more:
To stay ahead of competitors, you’ll also want to keep a close eye on their marketing activities. There are some great digital tools available now that make performance measurement and competitor tracking easier than ever before. Check out the Tool Tips section below for some helpful options.
And although it’s important to regularly review your marketing performance so you can course correct for better results, keep in mind the tried and tested tech industry mantra: ‘ship and iterate’.
This means don’t get lost in perfection delays, like agonizing over the perfect message or image for a post. It’s better to regularly get good-enough marketing out the door, so you can gather more data to steer your performance.
Another newbie mistake is to bite off more than you can chew with your marketing, and end up with mediocre results all round. Although it’s important to continuing coming up with new sales opportunities, operate in planned phases, rather than trying to do five or six campaigns at the same time.
You may find that the market expansion you envision will require deeper pockets than your current resources can handle. Many small businesses at this point spread their wings to the next level by getting a funding boost.
There are a number of ways you can do this: crowd funding, private investors, a small business bank loan, or a grand from non-profit organizations.
To attract the right investment and get the best deal, you’ll want to put together a brand vision deck. Here’s how to do it: An Entrepreneur's Blueprint for Crafting a Pitch Deck That Wows Investors.
A consistent growth mindset is what every successful, established business has mastered. In the competitive and ‘next-new-thing’ marketplace, if you become complacent you can quickly find yourself left in the dust by fresh, ambitious innovators.
It’s vital to keep a close eye on your performance metrics and competitor activity, as well as regularly update your business and marketing plan to meet changing circumstances.
Continue growing your reach, but don’t take your existing customers for granted. Marketing and sales after-care should go hand in hand. Ensure your brand remains both relevant and a trusted go-to that people will tell their friends and colleagues about.
Whether it’s retirement, interest in a different venture, letting someone else take the reins, or earning yourself a good nest egg, there will come a time when you’re thinking about an exit strategy.
Here are some guides to help you through this transition:
A range of small business owners we’ve surveyed have confirmed the business development stages we’ve explored in this guide. Our goal has been to give you confidence in knowing ‘the lay of the land’, with know-how and tools to help you succeed and making things easier, every step of the way.
From your initial exciting lightbulb moment and the creativity of building your brand, to the satisfaction of watching your business get established and then grow from strength the strength, every business is a labor of love and commitment.
If you’d like more clarity on which phase your individual businesses at, and what tools will best support that, go ahead and take the Business Lifecycle Quiz.
From site security to email service providers, here’s what you need to manage your online business.
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