How to build a successful business – over and over again
Blog post by Espen Bordvik, Head of Virtual Data Rooms at Admincontrol
Would you be able to build a business from zero revenues and a couple of employees to a viable business with more than 50 employees and €10M turnover? And if you already did, would you be able to do it all over again? That’s exactly what Mikael Hedlöf is doing. After helping out building up Samport Payment Services, the company was acquired and became a part of Nordic Capitals Bambora in 2014. Now, he is working as chairman for another Private Equity-owned company called OpenSolution Group.
Nordic Private Equity Conference
Last week I had the pleasure of discussing how to build a successful business and stay ahead of competition with Mikael at the Unquote Nordic Private Equity conference in Stockholm.
Here are some key take-aways from the fireside chat:
1. Provide Products over Technology
Identify the market and product fit, then scale! A technology could be used for building a number of products, however, solving real problems would often require providing a very easy understandable product to a market. Focus on that market until you are really successful. Identify the vertical, provide and adapt the product to that vertical and focus – for a substantial period of time.
2. Distribute in multiple channels to be competitive
How we do sales and marketing today varies a lot from ten years ago. If you had a relevant product and spent enough time and effort cold calling and doing field sales, you were likely to succeed. Today, successful distribution often requires multichannel distribution. In addition to direct sales, visibility on forums such as social media and other relevant web networks is key. Measuring CAC (Customer acquisition cost) on the distribution activities, and identifying what drives customer acquisition and retention, should be a focus area.
3. Define roles amongst CEO, Working Chairman and Management fund
The Board decides upon the strategy, and provides mechanisms to make sure the company is compliant with the applicable regulations. The Board also appoints the CEO, who is in charge of the day-to-day operations. An active chairman could provide a lot of industry and business development experience to the CEO, and be a powerful force in building a successful company. However, separation of tasks should be clearly addressed so that the chairman doesn’t stumble into the management tasks of the CEO. Clear mandates for the active operations of the chairman should be established. Examples could be: Working on strategic projects, building network for partnerships or leading acquisition projects.
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