3 Stages of Business Evolution

3 Stages of Business Evolution

1) STAGE 1 : Making Money and Surviving is the key

2) Businessman himself the Practitioner / Expert

3) He does everything himself and does not like anyone else doing the main work.

4) Very high levels of control

5) Extremely cost conscious

6) Small team

7) Focus is to ensure profitability

8) Cost Management is key factor

9) Stage 1 is about making profits

10) You are the sole boss


STAGE 2 : Early Stages of Scaling Up

1) Transformation from Practice to Business

2) Need to hire a team

3) Biggest Challenge is for the Business man to stop doing everything himself and hand over responsibility to team

5) Early Stages of delegation and letting go off the control

4) Business man has to start spending which is a challenge because previous stage one was all about cost consciousness

5) Adopting Technology

6) Targeting richer customer

7) Initiation of Branding

8) Creating a Company Structure

9) Early Stages of Company Culture formation

10) Early Stages of Bank Funding

11) Stage 2 is about having a smooth cash flow

12) You have a team to get along and keep them motivated


STAGE 3 : Full Blown Scaling Up

1) Hire Senior Team members

2) Focus of Brand Building and creation of Corporate Culture

3) Large Spending and increasing the Brand Footprint (a complete contrast from Stage 1 and also from Stage 2)

4) Brand, Team, Systems and Processes are a priority

5) Focussing on  Mobilising Long Term Capital by disinvesting equity shares first privately and subsequently going public

6) This is a full blown Scale Up Stage with serious capital infusion and Marketing

7) Brand Building becomes the biggest exercise

8) Stage 3 is about creating High Valuation for the company

9) You are one of the Directors and have to deal with equals


A) Clearly Stage 1 is about being Thrifty

B) Stage 2 is about loosening up the purse a little

C) Stage 3 is about Serious Spending in Branding and Marketing

Since the the very essence of Business Strategy changes from being cost conscious to have the courage, confidence and knowledge for mega spending it becomes extremely difficult for a single a business man to handle all the 3 stages

Therefore we say that the early Promoters can take the business upto a particular level after which they will need the help of others with very different knowledge and vision for driving the the subsequent stages

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