The Entrepreneur Insiders network is an online community where the most thoughtful and influential people in America’s startup scene contribute answers to timely questions about entrepreneurship and careers. Today’s answer to the question “What are some tips for maintaining a successful startup?” is written by Andy Lark, CMO of Xero.
Startups are funny things. No sooner than you’ve launched, you realize you are managing a real business.
Founders need to think about fundraising, boards of advisors, pitch decks, roadshows, and their ability to scale. They need to figure out how to build a global company and how best to pitch a group of potential investors.
For the many startup founders that I talk to every year, maintaining success distills down to three simple things:
Never forget the fundamentals
Most operations go out of business because they don’t have enough customers or money—normally at the same time. So invoice as soon as you can, preferably before you start or finish the job. Make invoicing and collections a daily ritual.
Never assume that the bigger a client is, the faster they’ll pay. Normally it’s the opposite. Be extremely clear on payment terms and consider reducing them where possible. If your terms of trade are 90 days, squeeze that down to 60. It’ll help to boost your cash flow.
See also: 4 Ways to Save a Failing Startup
The list of fundamentals is a long one. You’d be amazed the number of businesses I go into that fail to get key contracts in place before starting jobs, or fail to sign on a bookkeeper or accountant at the beginning. Your chances of success increase exponentially when you do.
Focus or fail
You’re either all in on a very specific task or you’re all over the place.
With success comes opportunity. And with opportunity comes distractions. Business coach and Hindu leader Dandapani explains that where your attention goes, your energy goes. In the early days of a new venture, we allocate a lot of energy to it. As success lands, we expand our focus and our energy goes with it.
Xero founder Rod Drury is often asked if he’d like to invest in up-and-coming startups, mentor, or sit on boards. More often than not, his response is, “Sorry, I’m all in on Xero.” He’s built a business from a few customers at the bottom of the world to a global enterprise worth billions of dollars, servicing more than 600,000 subscribers. You’re either all in or all over the place.
Energy and a passion to win are half the battle
When business owners are energized about their companies, they create a sense of hustle. They are passionate about the product, the customer, and especially the people.
I once met with the owner of a major coffee roaster, and he spent the first 20 minutes telling me all about his amazing baristas—how innovative and creative they were, about the amazing experiences they were creating for customers, and how he was flying them all over the world to compete in coffee-making competitions.
It wasn’t just that he was creating a fun work environment. He was making the fun infectious. His passion for energizing his people around the customer was resulting in a product and customer experience that is simply unrivaled in the industry.
So, you want to maintain your startup’s success? Simple: Never forget the fundamentals. Focus—go all in to avoid being all over the place. And make it fun. Combined, that means lots more than lip service. It means igniting the passion of every employee. Fail to do any of these three and you will be a startup of one employee pretty quickly. Fail at all three at once, and you’ll be starting again.
