In the life of most entrepreneurial companies, there will be crossroads; times when you need to decide “Do I go right or left?” Some crossroads will be about opening a new location or hiring more salespeople. At other times, you will have to decide on entering new markets, taking on outside investors, or buying a competitor. Trying to decide the right direction for your business will keep most entrepreneurs up at night.
What are the best or safest ways to take your company from where it is now to where you want to go? The simple answer is—it depends on your business and your mindset.
The first and most important question to ask yourself is “What type of business owner am I?” Consider the three types of owners I describe below, and decide which group is the best fit for you.
- Small Business Owners – At one end of the spectrum stand small business owners. They are mainly “lifestyle businesses” which means they prioritize a near-equal balance between business and personal time. They want to be in charge of their own destiny, but they don’t want a company that grows too big and disrupts their way of life. When opportunities are presented to them (i.e. crossroads) they will almost always see it as an expense out of their pocket rather than an investment into the business—and they will say no to it.
- Entrepreneurs – At the other end of the spectrum stand the entrepreneurs. They too want to be in charge of their own destinies, but they put less of an emphasis on work/life balance and focus more on ways to measurably grow their companies. When they come to a crossroad, they will almost always choose to invest in their businesses with new locations, more employees, and entering new markets.
- Passionate Business Owners – In the middle of the two ends of the spectrum are what I call “passionate business owners.” This group loves what they do and usually run successful companies. They are also typically the most indecisive group at a business crossroad.
Let me give you an example. A celebrity fitness instructor once reached out to me because she was at a crossroad in her business and was paralyzed with fear at the thought of making a wrong decision. She taught classes at the top gyms and fitness studios in her city, had hundreds of thousands of followers on social media, and she was a regularly featured expert in several industry publications.
An outside investor (who happened to be one of her devoted clients) wanted to invest a significant amount of money into her company for international expansion. I asked her “What was your initial, immediate reaction to the opportunity?” She replied “I don’t want to be a global fitness celebrity or entrepreneur. I’d like to stay pretty much where I am now, but I also don’t want to miss out on a once in a lifetime opportunity.” I told her to say no to the potential investor. Her gut instinct was correct. She had two young children and watching them grow up was her top priority. Why would she risk losing that for something that she didn’t want as much? She said no to the investor. Our conversation took place two years ago, and she recently said it the best decision of her business life.
If you run a successful company, there will be crossroads in your business life. The best way to approach them is to know ahead of time how you will respond to the opportunities or obstacles. The better prepared you are to enter the crossroad, the better your chances are for success coming from it.