4 Stages Of Business Growth

The 10X CEO Company Growth Stages

As with people, businesses go through stages as they grow and mature. And every stage has its objectives that lead to growth and potential pitfalls that lead to stagnation or failure. 10X CEO, which provides research and training for "high-performing CEOs," has identified four growth stages for companies characterized by their sales, number of employees and funding. Included in each stage are the specific objectives that must be met for growth, the CEO's role in those efforts, and potentially fatal flaws.

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Business Stage 1: Prototype

Sales: $3 million
Employees: 20
Venture Stage: Angel, A


Objectives:
Validated need/solution
Delighted customers
Reasonable profit/value assumptions


CEO Role:
One- or two-man band


Fatal Flaws:
Customer need isn't there
Solution doesn't work


Source: 10X CEO

Business Stage 2: Business Validation

Sales: $3 million to $20 million
Employees: 20 to 100
Venture Stage: B, C, D


Objectives:
Predictable delivery engine
Predictable sales engine
Profit/growth model validated


CEO Role:
"Emergency" player
Selector of players
Coach for players
Process engineer


Fatal Flaws:
Competition gets tougher
CEO is a good player, but lousy coach or architect
Return on investment isn't good enough


Source: 10X CEO

Business Stage 3: Growth

Sales: $20 million to $100 million
Employees: 100 to 500
Venture Stage: D or later


Objective:
Business grows without CEO involved in operations


CEO Role:
Chief culture officer
Selector of coaches


Fatal Flaws:
CEO becomes bottleneck (can't hire leaders or let go)


Source: 10X CEO

Business Stage 4: Maturity

Sales: $100 million-plus
Employees: 500-plus
Venture Stage: Public or sale


Objective:
Leaders and process continually improve
Innovation happens faster than existing business dies


CEO Role:
Seeing what's next


Fatal Flaws:
Leaders get distracted
Processes rust out
Ability to create dies


Source: 10X CEO