I named this stage in honor of a family friend who built a highly profitable company in the '70s and then started up a holding company that now owns around 10 businesses.
The "so what" about the four stages remains the same as in the blog post. Solidify everything in the stage you're in before focusing your efforts on the next stage. That way the rug will not be pulled out from under your feet.
Entrepreneur OR Small Business Owner
This is the subject Guy and I really had to compare notes on: entrepreneurism.
Most likely, you have come across Michael Gerber's book The E-Myth. Many contractors I run into mention it. The E-Myth thrust the term "entrepreneur" to the forefront of many a small business owners' minds.
What I have noticed over the last 12 years is that contractors rarely think like, nor picture themselves as, entrepreneurs. That's one of the things that separate contractors from almost all other small business owners. It's also the reason you should select professional advisors who have extensive construction background.
Here's the crazy part - not being overly entrepreneurial gives contractors a much better mindset for creating a stage 3 business.
True entrepreneurs bring an incredible intensity and passion to their business. Employees struggle to keep up with them. That drive and energy is great in the first two stages but usually becomes a road block to stage 3. The adjustment an entrepreneur must make in order to create a stage 3 business runs counter to his natural wiring.
Growth makes an entrepreneur's life harder. Conversely, growth tends to make a contractor's life easier. Well managed growth that is.
Larger contractors can afford to bring in specialists to perform the duties full time that the founder could only due part time. Those duties get done faster. Maybe not better, but certainly faster. (Remember, we're talking about well-run construction companies here.)
Most contractors think like small business owners. That serves them well in stage 2 and stage 3. However, a little touch of the entrepreneurial spirit sure comes in real handy during stage 1.
The Lesson - Act More Entrepreneurial
If you are in stage 1, challenge yourself to be more aggressive, more flexible, more creative, more customer focused. Think outside the box. Look for a way to change the rules of the game. Look for ways to take advantage of your competition's weaknesses. Learn to how to transition from small business owner to entrepreneur and back to small business owner.
That's what you'll need to do to build a stage 3 business and give yourself an opportunity to enjoy a stage 4 lifestyle!
Ron Roberts, The Contractor's Business Coach, teaches contractors how to turn their business into a profit spewing machine. To receive Ron's FREE Contractor Best Practices Newsletter visit www.FilthyRichContractor.com.