Why does your firm exist?
Spring Strategy Refresh
For most startup and scaling firms, this past year has been one long mud season. Customer and capital markets have rapidly changed and a new reality for scaling a business has emerged. Cost and access to capital became more difficult, scarcity and expense for employees increased, and buyers (i.e. a company’s revenues) grew more reluctant and slower to purchase. A focus on achieving a truly repeatable (i.e. scalable) and sustainable (i.e. positive margin) business arrived. Sadly, not all firms and jobs survived which has been truly painful to witness.
During this time, however, some companies did the previously unthinkable. They opted to get smaller by firing certain customers (i.e. shrinking revenues deliberately), closing promising lines of business (i.e. finding focus and competitive differentiation), or adjusting overhead and employees (i.e. lowering fixed expenses) in order to set the stage for their long term success. Those decisions took some real courage and commitment.
After a decade of growth at all costs and strong incentives for such behavior championed by peers, investors, advisers, and market headlines, chasing top line growth for growth’s sake alone has fallen wildly out of favor. A return to basics has become the strategy du jour for the foreseeable future (except for anything AI, that is).
Bigger (revenues, capital raised, headcount, valuation, press mentions, followers, etc.) does not often lead to an objectively better outcome for a company or its team. So with spring upon us, this is an opportune time to look inward at your organization whether private or non-profit and review your core strategic assumptions:
- Why does your firm exist?
- Who truly benefits from whatever product or service you provide?
- How can you better deliver these products or services?
- And how long can your resources last?
Each spring at VCET, we ask these questions and others as we plan for the next three years ahead. Our north star remains the Vermont entrepreneur, providing actionable advantages to help them start, scale and sustain their business. How VCET delivers on those strategic promises is where proactive operating decisions are made. No organization is immune to the trap of attempting to do it all, for everyone, all at once, and using someone else’s resources. Everyone’s strategy needs an annual spring cleaning and operational level set. If your organization would like some independent feedback, then please reach out. We’d be happy to roll up our sleeves and offer some help.
Onward,
Dave
