In our ongoing tour of the Bootstrap Stages, we leave the Valley of Death/Opportunity and arrive at Growth. I wrote an article in the latest issue of Business District Magazine titled, "Investor Funding (much) later than you think," which covers some of the important considerations of the Growth phase, including the ever-prevalent question of investor capital.
Growth is paradoxically the most sought-after stage and often the least interesting to the founders, who are best suited to Ideation/VoD. In this first Growth stage, it's time to bring on a COO and management team. They will help turn a chaotic and dynamic beast into a smooth-running machine which systematically and predictably serves its customers, develops its products and takes care of its employees. In other words, it is time (finally) to build the organization around all the insights and lessons from the first three stages. Hello MBAs!
The founders must be attuned to their potentially divergent needs from those of their now-growing offspring. Many times Maven founders find the dynamics of a growing organization all too taxing and exit, either leaving entirely or retreating into the background. Some are content to have a lifestyle business, choosing to keep it small and stay involved. Others are excited by the thrill of growing a large organization. The Leagues, cofounders of the Alamo Drafthouse decided they enjoy running the theaters. They found a third party to take the Alamo national while they continue to operate the Austin Alamos. Jim Goodnight, the founder of SAS, one of the largest software companies in the world, still spends 30% of his time coding! Meanwhile, bootstrappers John Mackey and Michael Dell have helmed their companies through the growth stage and beyond.
Many bootstrappers are tempted to start brand new products or initiatives in the early Growth period. This is not yet the right action! That comes next, in the first Rebootstrap phase, which we will discuss next week.