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10 Signs Your Company Has Outgrown the Startup Phase You're no longer a startup when investors inquire about your company without you begging.

By Peter Daisyme Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.


You've worked hard, and put in countless hours to make your company what it is today. You're now defined, and not necessarily because of your past or all the work you've put in. Your company is a startup because of what's ahead of you. Your future is growth, growth and more growth.

So, how do you know your business is ready to come out of startup phase? How do you know you're ready for all the work that lies ahead of you? Do you know all the signs you're ready? If your company is meeting these key factors, it's time to think about moving out of the start-up phase.

1. You have a product.

You're no longer talking to others about what you could be doing. You're now talking about what you are doing. Your company is no longer producing ideas, but you are now producing something real. You can now focus on creating new iterations, new evolutions of your product as you start to put your foot into the waters of your market.

2. You have a plan.

Many businesses find themselves stuck in startup stage because they don't know how to get funding. Don't worry, I was in this process too and it passes. So what happens when you have the funding, but don't know the next steps to take? Make a plan! Your idea has been proven, your business has been funded and your product is being produced. Your start-up now should have a plan or a credible model for the next phase of your company life. You should be able to point to Key Performance Indicators (KPIs) that you should be hitting. You should also have a 3 to 5-year plan and a list of key milestones to prove where you are heading to next.

Related: To Investors, Startups Without Business Plans Are Expensive Hobbies

3. Your team is now your company.

When you started, you had a team of people working with you. You started with people who had the skills that you needed; people who shared your vision and dream. Now when you talk about you team, you're starting to use the term "company" more often. You're thinking about hiring people, not just bringing people on board. You now know that you need to bring the right people into your company.

4. You know your market.

At one time, you had just an idea and a dream. But your company is now producing something that people want. You also have a marketing and sales plan for your target and you know how to reach them. You've probably even made some marketing mistakes, and you've learned from them. Your product is now tailored and a perfect fit for your market.

5. You have proven sales.

Because you have the sales, you can prove what your potential is in your market. You should know that the magic number for your investors is $1 million in revenue. When you can achieve regular revenues of $1 million, you can focus on the goals ahead. Goals like $5 million or $50 million aren't a fantasy, but a future.

6. You have a process.

In the more fluid stage of a startup company, everything is new and untested. But as you move out of startup phase into a growth phase, you start to focus more on quality. You start to focus on creating a system. You need quality and a way to maintain it if you are about to grow.

Related: How to Recruit and Hire the Team You Need at Each Phase of Startup Growth

7. You have independence.

In your startup phase, you received funding for what you needed. To test your idea, you needed the technology to do it. To reach your market, you needed to test out with early prospects. But as you move into the next phase, you're completely independent. You can produce the Minimum Viable Product required to grow. This means that you don't rely on anyone else; your company makes enough to sustain itself.

8. You attract funding.

In the early stages, your job was to seek funding and investments to get your idea off the ground. Now, as you move out of the startup phase, you investors will come to you. When you're demonstrating proven sales, and you're meeting the key milestones, people will notice. Many of those people will be the investors you need.

9. You have lower risks.

In the early concept and startup phases of your company, all you could do was manage the risk. You had little to no revenue, an unproven model and no funding to back you up. When you have a proven record and a definite plan, your risks start to drop. Any company has risks and a sure sign you're ready for growth is when you have less.

10. You have the ability to scale.

With a proven model, a proven marketing plan and a proven product, your once-little startup is ready to grow up and move out of the house. All that's left is to scale the model you've already established. All it will take is that seed money to scale your customers, your production and your staff. This will also scale your profits, which is what it's all about.

It is a major milestone when your company reaches the end of the startup phase. Take a moment to acknowledge that milestone. There is a lot of work ahead of you and it's worth your time to know you're ready for that next growth phase.

Related: As Your Startup Grows You Have More Explaining to Do

Peter Daisyme

Entrepreneur Leadership Network® Contributor

Co-founder of Hostt

Peter Daisyme is the co-founder of Hostt, specializing in helping businesses host their website for free for life. Previously, he was co-founder of Pixloo, a company that helped people sell their homes online, which was acquired in 2012.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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