A company has a series of natural plateaus where it typically gets stuck. Why !
The first Plateau happens around 2 or 3 employees where you need to make the conscious decision of whether you want to have a well paid job or own a real company.
I see this all the time where business owners think they have a sale-able business but in fact all they have is a very well paid job and good luck to them if thats what they want. But the push for growth is not smooth.
The second plateau happens around 10 or 12 employees where the owner has built a team of helpers and making a good living but has not created a management team, and therefore will have trouble pushing beyond a dozen people or a few million in revenue.
In fact, many businesses that strive for the next plateau – somewhere around 50 employees – often start and fall back to the safety of the 10-12 employee range a few times before they finally make the leap to the next plateau.
The culprit is complexity. You go from a 3-person company where everything is in your head, to a 12-person company where you have to rely on others to get things done.
At a dozen people, your business is more complex, but still relatively manageable because you’re in direct contact with the people you’re relying on to do the work.
However, trying to get to 50 employees requires that you somehow control your front line staff through a layer of managers.
That’s where things often get unstuck.
People being people, some of your ideas get through the layers; others get misinterpreted, forgotten, or ignored in favor of the opinion of the managers you’ve hired.
Hire the wrong managers, or fail to communicate your vision effectively, and you tumble into the valley of death.
Remember 3 12 and 50 then its time to sell.