Why I Think Keeping Your Business Small Can Be Better Than Expanding
Opinions expressed are solely those of the author and do not reflect the views of Rolling Stone editors or publishers.
We all have grandiose ideas when we decide to start our own business. We picture being the next unicorn no one saw coming, adorning the covers of magazines, leading TED Talks, shaking hands with presidents and, of course, speaking to ivy leaguers at their graduation ceremony.
I once had big ambitions. I thought that in order to feel like my company was growing, I had to establish as many offices as I could. At one point, I had several locations in Canada, the U.S. and Europe. It didn’t take long to realize I was hemorrhaging money and valuable time, all because of what I pictured a high-growth company looked like. Boy, was I wrong.
It wasn’t until I scaled back to a couple of locations that I saw my profits really take off. There’s something incredibly valuable about staying small, especially if you’re the sole person in charge.
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Building a company from a staff of one (that would be you) to establishing offices across the globe is no easy feat. Creating a legacy brand is definitely something to strive for; however, you don’t need to build your own corporate campus in order to make a real impact, whether that be now or in 30 years.
My recruitment and staffing firm has worked with hundreds of small agencies, medium-sized corporations and global Fortune 500 companies over the past two decades. I’ve seen everything there is to see when it comes to a small operation or a behemoth conglomerate. And you know what? There are some serious perks to managing a small and nimble business. Here are a few reasons why.
You’re able to act fast.
Small businesses are nimble, while big companies are usually inflexible. You can throw out old policies and procedures and replace them with something else if you want to. Staying small is what saved our business during the pandemic. In fact, 2020 was one of my organization’s best years yet. If I had been in charge of hundreds of employees in dozens of offices, there’s no way we would have had the same results. The board of directors and executives would have to analyze, argue and test potential changes to death. Meetings on meetings on meetings would have had to occur, and by then, it could’ve been too late.
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You can attract better talent.
This is the No. 1 opportunity that many entrepreneurs don’t realize they have when it comes to recruiting and sustaining key employees.
There are serious perks to working at big-name companies like Google, Amazon or Apple. Not only is it a resume differentiator, but there are a lot of perks with large organizations, like a generous salary, a fancy office and state-of-the-art amenities. However, talent also runs the risk of being limited in their growth and creativity. They can be stuck in a department, making it pretty difficult to try new things or cross over in order to expand their skill sets.
At a small business, it’s easier to recognize performance. There’s more opportunity for employees to move several notches up the corporate ladder with much less competition vying for the same role. You’ll also have the ability to cultivate a creative and hands-on team. It’s an experience you likely won’t get at a big corporate brand.
You’re not obligated to raise capital.
When you’re self-funded, you have one thing many other startups don’t: freedom. You can spend it how you want, when you want. You’re also not forced to drop millions of dollars and grow at an exorbitant rate just to satisfy your board who are itching to see a return on their investment in a small amount of time. When you use your own money, you call the shots.
We’re always taught that bigger is better, but when it comes to business, it can be a dangerous strategy. There’s no shame in staying small. Not only can you be a lot more profitable, but you could also have a much better quality of life. When I expanded to Europe, I was on a plane every other week; I missed so much time with my two young sons. As an entrepreneur, we know there are sacrifices we have to make, but I encourage you to write out what matters the most and build that dream, rather than an ideal.
Stay small, but think big.
Just because you run a small business doesn’t mean you can’t think big. You can still reap incredible profits without operating on a global scale. Don’t forget that a big company also has bigger things to manage, bigger costs and often bigger problems. The smaller you are, the more you’re able to manage on all ends of the spectrum, from staff to culture to product to locations. Never underestimate the power of staying nimble.
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