6 Signs Your Fast-Growing Business Needs More Capital

Wednesday 5th May, 2021

Once a start-up establishes, the logical next phase is anticipating growth. The intent is to build something great that enables the business to expand. However, learning how and when to grow can be a daunting task for any small business. Besides, growing too early or too quickly can strain the business financially as well as impact productivity and efficiency.

As to manage a fast-growing business without adequate tools and resources, it is essential to add more capital to keep up with the expansion. This enables you to have healthy and sustainable growth while streamlining processes and service delivery. With that in mind, here are six tell-tale signs your business is growing fast and requires more capital.

CASH FLOW CRISIS

Clogged cash flow is among the decisive signs of unsustainable growth when your business is expanding tremendously. Lacking funds to finance various operations can impact your fast-growing business. Besides, a cash flow crisis is often associated with other issues, and it is a common concern for any business. When you have multiple outstanding invoices, messy financial systems and missed payments to partners or vendors, it is high time to consider outside financing options.

DEMAND IS CONSISTENTLY HIGH

If you notice sales leads are going untapped or your team is taking longer to fulfil customer requests, it may signify that demand has surpassed what you offer. This means your business needs funding to hire more staff, expand your facility or buy inventory to ensure continued success in your business. Because your customers need more from your business, securing growth capital allows you to meet the demand and protect your current customer base.

A WORTHWHILE BUSINESS OPPORTUNITY SURFACES

Sometimes you may need to expand your business when a worthwhile opportunity comes knocking. For instance, when a large and brilliant store in a competitive part of town opens up, moving into such a space enables you to become even more profitable. Henceforth, acquiring more capital helps you capitalize on emerging opportunities and achieve your business goals faster.

NEED FOR MORE SKILLED PERSONNEL

Typically, companies require skilled teams to facilitate certain operations and guarantee productivity. But during the growth phase, you may no longer have adequate expertise to perform specific tasks within your company. The best way to address the issue is by hiring experts to work on individual departments and deliver better results.

It is a typical trend in your business’s lifecycle that allows you to embrace your weaknesses and hire the right people. However, the hiring process requires more capital which may not be readily available in the business. Getting funding from investors or lenders can help hire skilled personnel to fuel your business growth.

YOU’VE AN OUTGROWN TECH STACK

Most start-ups work with entry-level software to expedite operations within the company. But as your small business expands, you need advanced technologies and tools to perform better and scale up effectively. During the rapid expansion period, it is high time to input more capital and upgrade your systems, including features, to become more productive. These include automated systems and user-friendly interface, which require growth capital to keep up with your fast-growing business.

THE FUTURE ISN’T CLEAR

Small businesses growing too quickly tend to focus on the present, hence having limited plans for the future. When you aim at thriving now without a clear vision of what is next for your brand, you could be running a risky business. Although the business is anticipated to grow, failure to invest in the future should be a significant concern in your business.

Therefore, continually evaluate your business to understand accomplished monthly or annual goals, and if you are still aligned to your business plan. If you have shelved your long-term business goals and only focusing on the present, seeking growth capital is crucial to building a bright future for your growing business.

At Betterbanc, we understand how hectic it can become seeking financial help to finance your fast-growing business. Henceforth, we remain committed to ensuring small business in SA access growth capitals and expand their businesses effectively and efficiently. For more information regarding growth capital, contact us to learn more today!