In this week’s blog post, I’m sharing some traits of high growth companies that provide professional services directly to consumers, such as law firms, accountants, and lenders. While deciding to launch Compass Growth Partners we conducted a great deal of research on our market size. During this process and through discussions with other entrepreneurs, some commons success factors continued to surface when looking at SMB’s that achieved rapid growth.
Here, I outline what I think are the five most important characteristics that consumer professional service providers need to possess to achieve high growth.
- They know their lead generation metrics. Companies that grow quickly have a strong understanding of their basic marketing and operational data. Off the top of their head they know how many incoming calls it will take to retain a new customer, they know their customer acquisition costs, and they know the lifetime value of a customer. They know how much investment in marketing is needed for them to hit their maximum intake capacity. Companies who have the answers to these questions are prepared for growth.
- They surround themselves with the right people. They hire entrepreneurial people who are aligned with their company mission and understand the growth vision. They know how important it is to hire people who will be able to do the work that the company will need to do in the future, not just the work that needs to be done in the present. They hold off on hiring specialists until absolutely needed. High growth small businesses find their tribe and work with all the resources that the tribe provides. As Jim Collins details in his book Good to Great, get the right people on the bus.
- They have a dedicated customer acquisition team. Having a team that is solely focused on lead generation makes it easier to determine what your qualified leads are. When sales teams and marketing teams share the job of customer acquisition, it’s easy for the waters to get muddied. Generating leads is not the same as closing sales, so different skills are needed for each task. A dedicated customer acquisition team can free up your precious time, since they are doing the research and data mining for you. It also means that they can analyze the data and figure out the lead conversion process, making it easier for you to approach your potential clients in a more targeted manner.
- They take risks. Not just any risks, but calculated risks. The importance is in knowing the difference and doing the research and planning needed to evaluate whether a risk could be worth it or not. These successful companies can look at all the options and decide on a strategy of action and implementation even when there is some risk involved. When done with careful attention to potential consequences, taking a calculated risk could lead to great rewards.
- They specialize in their service and execute. High growth small businesses do well to focus on what they know and on what they do well. They are more likely to be highly specialized and offer fewer services, but execute the provision of those services incredibly efficiently and strongly.