Need 2 know: How to get beyond start-up intensive care
Many years ago I spent some time in one of Australia’s premier intensive care wards.
Thankfully, I wasn’t there as a patient – I was gathering facts to help me create an advertising campaign to raise money for research into intensive care medicine.
As I think about what insights and advice I can offer a start-up approaching its third year of life, I am reminded of what the director of that intensive care ward had to say to me about his job.
When a critically ill patient is being rushed into the emergency room for whatever reason – a car crash, an acute illness, a serious assault – the emergency room team has a very clear and simple goal.
However they do it, their job is to keep the patient alive. It’s frantic and busy. It’s loud and scary to watch.
An emergency room is the absolute definition of organised chaos.
For the team involved, the only key performance indicator that matters is whether the patient lives. It’s seat-of-your-pants, balls-to-the-wall medicine.
Running an early-stage start-up is very similar. In the first year or so, the key task is keeping the business alive.
Whatever you do and however you do it is irrelevant. The only metric that matters is whether the business lives.
After that first year or two (assuming you make it), the business is effectively stabilised. People are buying the product. People are talking about the business.
A competitor or two have entered the market. The business is alive, even if its vital signs are still weak.
It’s not dissimilar to a patient going from the emergency room to the intensive care ward. The business is still in need of critical care but that moment-to-moment pressure of the business dying on the trolley has passed.
The pace of the intensive care ward is entirely different to the emergency room. Things are much quieter. And while there is still an intensity, it’s a different kind of intensity.
In intensive care, the doctors observe the patient in minute detail and think slowly, deeply and methodically about what needs to be done – using the latest ideas from every branch of medicine – to restore the patient to complete health.
That is exactly what a start-up approaching its third year needs to do.
It needs to get more introspective. It needs to start analysing itself dispassionately and putting in place the robust systems and processes it will need to continue growing.
The flair, intuition and improvisation that proved so useful early on need to give way to more systemised ways of doing things.
Not only will these systems prove vital to support serious growth both in terms of sales and employee numbers, but it is also the goodwill that a potential acquirer will be buying – the ability of the business to function in the absence of the founders.
A business where every methodology is only written down inside the founders’ heads is far less valuable and at the very least limits the founders’ ability to move on quickly if that is their wish.
Early in the life of my start-up, a mentor suggested that we should hold regular monthly board meetings and produce detailed board papers as a record of those meetings.
I have to admit that at the time, I argued that they were a complete and utter waste of time and I think that I was right.
I was far more focused on making that next sales call or running, fire extinguisher in hand, to put out the latest spot fire that seemed to flare up out of nowhere and immediately threaten the very existence of the business.
I used to protest that we didn’t have the time to waste on corporate window dressing.
Eventually I came to realise that as the business developed, the so-called corporate window dressing was important. It was the sign of a serious and mature business.
It was the sign of a business that valued process and was focused on building something that other people could make sense of and have confidence in.
So, to me, coming up to three years the key challenge for a start-up is to retain that entrepreneurial flair while putting in place the systems of an established business.
If I was to draw a fashion analogy (not an area of strength for me!), it’s like wearing the typical jeans and trainers of a start-up entrepreneur but replacing the funky t-shirt with a slightly more serious-looking shirt and jacket.
The look is a bit ‘80s but hopefully you get the point.