This may sound like déjà vu: a few years ago, you had a vision to create your own business. Through careful execution and a lot of nurturing, your business began to grow. Naturally, you hit a few bumps along the way (cash flow and inventory out-of-stock issues), but you recovered. After all that hard work, your startup survived and thrived.
All entrepreneurs go through this process of seeing their visions materialize before their eyes. No matter if it’s a new, innovative product or a fresh take on a classic, your dreams of owning a successful business have come true. At this point, it’s time to ask yourself “is my startup no longer a startup?” More specifically, “has my startup grown into a second-stage business? What do I need to handle this growth?”
There’s no exact determinant to see if your startup has evolved into a second-stage business. Generally speaking, if your business has over 15 employees and/or over $750,000 in revenue, you may no longer be a startup. Congratulations! You are now a second-stage company.
Second-stage company challenges
Overwhelmed Staff
While multitasking is a great feature to look for in your employees, they should not have to question what their true role is because of the different areas of business they’re working on. If leadership and management are one in the same, there may be a disconnect as to who the visionary is and who should be managing the rest of the staff. There’s a proper balance to uphold, and that can’t be achieved when your staff is overwhelmed with various tasks that aren’t in their wheelhouse.
Lack of a Clear Vision
When your startup began, you and your team were in it to win it with the goal of growing the business and making revenue. Now what? Without a company mission, employees are left scratching their heads and wondering why they’re sticking around (other than a paycheck). Is everybody running off in different directions with no clear focus? Employees mean well, but without a single direction the company can’t successfully move forward.
Poor Inventory Management
When you first started selling your products, it was an order here, a shipping label there. Now, you’re trying your hardest to keep up with the growing demand and your current accounting system lacks in strong inventory management capabilities. Can you manage all of the pricing, reordering, and stocking characteristics by yourself?
[Related: The Benefits of Reliable Inventory Management]
Consolidated Business Financials
After the initial startup phase, it may make sense to break your business into multiple companies for a variety of reasons. Whether that means limiting liability, managing real estate, or tax reasons, you’ll have to figure out a way to keep track of each company. Without the proper business software, you’ll be left logging in and out of databases. What about consolidated business financials? Forget about it if you’re still on QuickBooks.
Accounting Solution Can No Longer Keep Up
Entry-level software such as QuickBooks or Xero can only get you so far. When it comes to inventory, advanced reporting, and getting real-time insights into your business, you’ll have to hire additional staff to be able to account for those metrics in an entry-level accounting software!
When it comes to a functional accounting solution for your second-phase business, there’s only one answer: Gravity Software® (Gravity). Gravity is a robust, cloud accounting solution written on the Microsoft Power Platform (aka Dynamics 365 CRM). Gravity fills the gap between entry-level software like QuickBooks and the expensive enterprise applications your business isn’t ready to cash in on. As your business continues to grow, Gravity will be there every step of the way, never holding your business back from its fullest potential.
Want to learn how Gravity’s innovative business financials can boost productivity from every direction? Schedule an online demo today!
Gravity Software
Better. Smarter. Accounting.
