How to Scale Your New Business: The Complete Guide for New Founders & Entrepreneurs

+ Bonus Resource Guide to Top Bay Area Fractional Service Providers & Businesses

Launching and scaling a new business is not for the faint of heart. Bookmark this as your go-to resource for tips, information, terminology, and resources that can help you scale farther, faster. We’ll continue to update it, so be sure to check back.

In this guide, we’ll explore the questions:  

1. Why should you establish a plan for scaling your new business?
2. How do you know if you’re ready to scale?
3. What are common scaling challenges? 
4. How can you manage the challenges of scaling a business?
5. What are growth activities that make it easier to scale?
6. Who can you hire fractionally that makes scaling easier?
7. Why fractional service providers?
8. What’s the right timing for a new business to engage with a specific provider?
9. Does your new business startup need early-stage funding? 
10. What should you think about when building an advisory team for a new business?
11. What are best practices in building a business model for rapid growth?

Why should you establish a plan for scaling your new business?

Building a business starts with a great idea, but that great idea needs to be adaptable — it’s essential to think about how your business will grow and evolve. Investors, customers, and potential employees will all want to hear about your vision and how that plays into the growth of your organization. Creating a clear plan for how you intend to scale your business also ensures that you stay proactive about the capital and resources you’ll need for longevity.  

Achieving sustainable growth demands careful planning, execution, and regular monitoring of your key goals or performance indicators. If you’re thoughtful about your business growth, it will help you adapt to changes in the market and weather unexpected challenges.

How do you know if you’re ready to scale?

Here are some areas that indicate the health of your new business and if you’re ready to take the next step:

• You have clear founder-market fit. Your brand requires your passion and personal expertise to connect to the problem you’re solving. Building a strong brand story can help prove founder-market fit — why you are the best person to lead this company. Presenting a clear personal brand is particularly essential to prove earlier in the startup journey, because when your business is small investors are investing in you, not just your business. Poor founder-market fit is one of the top reasons why an investor pitch fails.
  • Also, be sure to also consider your brand story early on. Jumping into marketing tactics without a solid brand foundation can be like throwing spaghetti against the wall to see what sticks. In fact, branding done right can double your input on profits.
• You’ve proven product-market fit. Your Minimum Viable Product (MVP) or service must solve a genuine problem for your target market to build consistent demand.
• You’ve secured multiple rounds of funding or consistent revenue. Secure enough funding, whether through venture capital, angel investors, or other sources, to support your growth goals. Read the blog on pitch decks. Many new businesses choose to bootstrap without funding with slower growth without giving equity away.
• Your initial business model is functional and proven. To scale properly, it’s essential to understand your revenue streams, costs, and overall profitability inside out.
• Your marketing and sales process is repeatable. Know your ideal customer profile and have effective marketing and sales strategies that can be easily scaled.
• You have confidence in your existing foundational team and infrastructure. Your team must have the necessary skills and experience, and that the required systems and processes are in place to handle increased demand.

What are common scaling challenges? 

Scaling can come with significant business risks for founders. Here are some of the main challenges you might encounter and tips to avoid common pitfalls:

1. Maximizing Profit Margins

As your business expands, you’ll likely need to invest in new equipment, technology, and talent, which can drive up costs and impact margins. Simultaneously, you’ll need to keep your prices competitive to attract customers.

💡Tip: Consider fractional talent vs. in-house to keep costs in line. 

2. Building Cash Reserves

Rapid growth can strain your business’s cash reserves. Ensuring you have enough cash to cover expenses, pay bills, and invest in growth opportunities is crucial to avoid financial difficulties.

💡Tip: Partner with the right investor and accounting partner to help you accelerate and manage your cash wisely. 

3. Finding Talent 

Scaling often means expanding your team. Finding the right talent, navigating the hiring process, and meeting compliance guidelines can be a daunting task. Finding the right early talent is one of the most critical elements to build on early success. The wrong hire can make or break your growth and budget.

💡Tip: Consider fractional talent vs. in-house to keep costs in line. Consult with a proven HR partner. 

4. Navigating Market Conditions

The market can shift quickly, and businesses need to be agile to stay competitive. This might involve pivoting your business model, updating marketing strategies, or exploring new markets.

💡Tip: Early on, consider building an advisory team to stay ahead of market changes and gain valuable input. Check out the tips below. 

5. Transforming Operations

Creating a business model that can adapt to rapid growth without sacrificing quality or efficiency is essential. This involves careful and proactive planning, market research, and testing.

💡Tip: Read our advice for building a business model for rapid growth. 

What are growth activities that make it easier to scale?

Let’s dive into five core activities involved in scaling your new business effectively:

1. Fundraising

It’s essential to build a strong runway of cash reserves as you prepare to scale your business. If you need funding support, your investor pitch should demonstrate strong growth progress and fundamentals. Metrics surrounding customer growth, sales, and product utilization, should tell the right story about your existing traction and future potential.

Raising funds can also benefit your business by exposing you to a larger network of resources, contacts, and partners and offer you more credibility. However, you should consider that it can also dilute your equity and increase pressure on your business to meet specific growth targets.

Tip: Build strong relationships with potential investors by attending networking events, establishing an online presence, and leveraging referrals from existing investors. Building a strong personal brand can also help you build trust with investors faster.

2. Building Strategic Marketing 

A robust marketing strategy is crucial for driving growth. Conduct a thorough market analysis to identify trends and opportunities. Develop a comprehensive strategic marketing plan encompassing your brand strategy, vision/mission, positioning, identity, and key messages. Once you have the foundation built, you can begin building your content strategy and campaigns.

Building your marketing strategy helps your business increase brand awareness, drive revenue, and improve engagement with customers and prospects. Marketing requires long-term commitment and consistency to build over time. If you’re entering a crowded market, there’s a risk of disappointment in not seeing immediate results and you’ll need to be flexible with pivoting tactics that may need new approaches.

Tip: Consider your company and personal brand. Like building a house, developing a solid marketing strategy and branding will set the foundation and tone for your digital marketing campaigns and social efforts.

4. Creating Upsell or Cross-sell solutions

Introducing new products or services that complement existing offerings can drive growth. Focus on developing a launch plan aligned with your strengths and market demands.

Offering ways for your current customers to continue to buy increases your revenue and retains your customers. If your customers already work with you, extending your solutions help you increase brand loyalty. Of course, there are risks of launching a new product that backfires and doesn’t resonate with your customers. Plus, your competition is always on the lookout for stealing your business. The wrong solution can create a door opener for your competitors.

Tip: Use events and press coverage to boost new solution visibility. 

5. Hiring an Experienced Leader

Bringing in an experienced leader can guide your business through the growth phase, bringing expertise and strategic planning skills.

Identifying leadership and experience gaps and filling it with proven help can improve your strategic planning, increase efficiencies, and grow your credibility with investors and customers. Top talent does come at a cost and many existing team members can resist change. 

Tip: Identify specific skills and experience needed, such as a proven track record in scaling companies and strong leadership. Consider fractional leadership to manage your costs while bringing in top talent. 

By focusing on these strategies and addressing associated challenges, your business can navigate the complexities of scaling effectively. 

Who can you hire fractionally that makes scaling easier?

San Francisco Bay Area businesses must scale intelligently to ensure success. As you navigate the challenges of growing your venture, one crucial aspect often gets overlooked – pulling together the right team of experts to support your growth trajectory. And, hiring is costly – you don’t want to burn through your investor funds too quickly.

Fractional service providers offer a smart solution, providing specialized expertise without the overhead of full-time hires. Here’s a comprehensive guide to leveraging fractional service providers for legal, human resources, marketing, product, and accounting needs, tailored specifically for Bay Area businesses and founders; however, all providers work with customers across the United States.

1. Accounting & Finance – Edge Pursuit

Maintaining financial health is critical for the sustainability and scalability of your business. Edge Pursuit offers fractional CFO and accounting services specifically designed for businesses. Their team of seasoned financial experts provides strategic guidance on accounting function setup, processes, tech stack, budgeting, cash forecasting, fundraising support, and compliance, empowering you to make informed decisions that drive growth. They serve a broad range of businesses, from seed to public companies. 

IDEAL ENTRY POINT: Seed or Series A stage for accounting, financial projection and compliance. 

“It doesn’t take much (effort or cost) to set up the accounting infrastructure properly with today’s tech stacks. Making these small investments upfront help avoid significant accounting and compliance debt down the road Edge Pursuit serves as our clients’ fractional accounting team and supports founders by managing all aspects of the finance function. We bring a lean and effective solution that enables confidence and a quicker path to scale.” – Rays Zheng, Co-founder, Edge Pursuit

2. Legal – Primum Law Group

Navigating the complexities of legal compliance and intellectual property protection demands seasoned expertise. Primum Law Group specializes in providing comprehensive legal solutions tailored to the unique needs of startups. From entity formation to contract negotiation and intellectual property strategies, their team ensures your legal framework is robust, scalable, and aligned with your growth objectives. Primum also helps many international businesses launch in the United States.

IDEAL ENTRY POINT: Pre-VC capital ready for professional investors.

“As a doctor practicing preventive medicine helps patients avoid future health issues, I see my role in helping startups navigate legal risks before they become costly problems. These risks can arise from various sources, such as choosing the wrong jurisdiction for incorporation or overlooking the critical importance of legal compliance in the sales process. Platforms like LegalZoom and Clerky are great starting points, but when you’re ready to engage with professional investors, you need a professional legal team by your side. And above all, ensure that you and your co-founders are aligned, with your agreements documented— even if it’s just written on a napkin!” -Svetlana Kamyshanskaya, Founding Partner

3. People Operations & Human Resources – HENSLEE HR

HENSLEE HR delivers a fractional People Operations tailored for early-stage companies. By combining expert HR support, technology integration, and mentorship, HENSLEE provides a comprehensive solution that helps startups implement scalable HR systems, build strong cultures, and align their people strategies with business objectives. Whether through technology-driven automation or strategic advisory, HENSLEE empowers teams to focus on growth while optimizing  their people operations.

“Your people are your most valuable asset – investing in development, retention, and developing a strategic People Ops roadmap is essential for long-term success in today’s dynamic business landscape. 

Teams with strong POps see 30% higher revenue growth. By prioritizing scalable HR processes and employee experience early on, you’re not just avoiding costly missteps; you’re laying the groundwork for sustainable growth. While the demands on teams are numerous, proactively addressing People Operations can prevent critical issues from emerging later.

That’s why we created HENSLEE – to provide early-stage companies with a scalable solution that supports growth and establishes a robust people foundation, setting the stage for enduring success.”  -Leslie Hensley, Co-founder, HENSLEE HR

IDEAL ENTRY POINT: 

• Early Foundation Stage (5-25 employees): You’re a founder who recognizes the importance of PeopleOps but lacks resources for an in-house HR hire. You want to establish solid HR foundations to support future growth.
• Growth Acceleration Phase (20-50 employees): You’re preparing for rapid team expansion and need scalable HR processes. Your current HR practices are becoming strained as your team size increases.

4. Strategic Marketing, Personal Branding, & Brand Messaging – OakBloom Marketing

In a competitive landscape, effective marketing and the right product can make all the difference in establishing your business’s brand presence and driving customer acquisition. OakBloom Marketing specializes in influential storytelling boosting your personal brand to build trust and credibility with your customers and investors. From engagement boosting LinkedIn profile enhancements to founder personal brand reputation support to company brand messaging and thought leadership, their reputation boosting storytelling services help you build foundations for success.

IDEAL ENTRY POINT: 

• Founder personal brand story: Pre-seed to seed funded 
• Company brand messaging: Pre-seed to seed funded 

“The biggest pitfall for new entrepreneurs is trying to do everything alone. Your most powerful marketing asset is authentic storytelling that connects emotionally with your audience – build trust by revealing the genuine passion behind your venture, not just selling a product.” – Jeanel Carlson, Co-founder, OakBloom Marketing 

5. Information Technology and Cybersecurity – CMIT Solutions

CMIT Solutions provides managed IT support and cybersecurity services with a dedicated team of IT specialists to keep your business running smoothly and efficiently. We offer a full suite of solutions to handle the growing complexity of IT and cybersecurity so you can stay focused on growing your business. Our team can help you avoid common pitfalls, allowing you to focus on your core mission while we ensure your technology backbone is robust, secure, and aligned with your growth objectives.

IDEAL ENTRY POINT: Seed stage or prior to product launch

“In my decades of experience with businesses, I’ve seen many promising businesses falter due to inadequate security, IT infrastructure and support. At CMIT Solutions, we understand the unique challenges that businesses and small businesses face, and we’re committed to providing scalable, innovative IT solutions that grow along with your business.” – Bob Lee, Owner and President, CMIT Solutions

For Bay Area or US new businesses, success hinges on strategic partnerships that empower growth and innovation. You can confidently drive success by harnessing the expertise of fractional service providers in legal, human resources, marketing, product, and accounting. Our vetted list of Silicon Valley Bay Area providers can plug and play their expertise allowing you to grow with peace of mind.

👉Reach out to any provider today and mention SCALING GUIDE to receive a free 30-minute consultation.

Why fractional service providers? 

💰Cost-Effective: Fractional services allow businesses to access high-quality expertise without the financial burden of full-time hires, enabling efficient resource allocation.

💪Flexible and Scalable: As your business evolves, fractional businesses can scale their support to meet your changing needs, ensuring agility, and adaptability.

🥼Specialized Expertise: Fractional providers bring niche expertise and industry insights, offering tailored solutions that align with your business goals and challenges.

🏃Faster Time to Market: With their extensive experience and ability to hit the ground running, fractional services can expedite project timelines and reduce time to market.

🧪Reduced Risk: Businesses can test out services and expertise on a project basis before deciding on longer-term engagements. 

📅Schedule today and mention SCALING GUIDE to receive a free 30-minute consultation.

What’s the right timing for a new business to engage with a specific provider?

Journey map timeline/roadmap to when new business should engage with a provider type. Journey map/roadmap flow:

1. Bookkeeping (business forms company on their own)
2. Lawyer for compensation plan if they need to start hiring
3. HR for hiring
4. Financial projections for another raise of capital
5. Marketing for pitch and positioning
6. Compliance depending on the industry
7. Insurance with hiring directors and officers
8. IT
9. CPA for taxes

📅Schedule now – mention SCALING GUIDE for a free 30-minute consultation.

🛑WAIT! Does your new business need early-stage funding? 

Early-Stage Funders:

Here are the top 10* accelerators that you can apply at a super early stage 👇

1. Y Combinator | Pre-Seed, $500K for ~10%
2. Entrepreneur First| No team, $250K for ~9% (joinef.com)
3. South Park Commons| Pre-Idea, $1M
4. Antler Global | Pre-Seed, $250K for 9%
5. Sequoia Capital | Pre-Seed, Seed $500K – $1M
6. HF0 Residency | Pre-Seed, $500K uncapped + 3%
7. Pioneer Fund | Pre-Idea, $20K for 1%
8. Pear VC | Pre-Seed, $250K – $2M
9. Techstars | Pre-Seed, $100K for 6%
10. Andreessen Horowitz (a16z) Start Program | Pre-Seed. $500K – $1M

*Directional only: accelerators and criteria subject to change.

What should you think about when building an advisory team for a new business?

When to Build an Advisory Team

An advisory team can provide invaluable guidance, connections, and credibility to a business. Consider forming one at these key stages:

• Early stages: When you’re defining your business model, product, and market.
• Pre-seed or seed funding rounds: To attract investors and validate your business plan.
• Scaling up: As you’re expanding your operations and facing new challenges.

How to Build an Advisory Team

1. Identify your needs: Determine the specific areas where you seek expertise, such as marketing, sales, finance, technology, or legal matters.
2. Network and leverage connections: Reach out to your personal and professional network, attend industry events, and utilize online platforms to find potential advisors.
3. Evaluate candidates: Consider their experience, reputation, and alignment with your business’s goals. Look for individuals who are passionate about your industry and willing to contribute actively.
4. Offer value: While advisors often provide their expertise pro bono, it’s important to offer something in return, such as equity, board observer status, or other benefits.

Cost

• Pro bono: Many advisors are willing to contribute their time and knowledge without monetary compensation, especially if they believe in your business’s potential.
• Equity or other compensation: In some cases, advisors may request equity or other forms of compensation, especially if they are providing significant value or taking on a more active role.
• Fees: While less common, some advisors may charge a fee for their services, particularly if they have extensive experience or are offering specialized expertise.

Key Considerations

• Clear roles and responsibilities: Define the expectations and boundaries of the advisor’s role to ensure effective collaboration.
• Regular communication: Maintain open and frequent communication with your advisors to keep them informed and engaged.
• Value their input: Respect their advice and expertise, even if it doesn’t always align with your initial plans.

By carefully selecting and engaging with an advisory team, you can significantly enhance your business’ chances of success.

What are best practices in building a business model for rapid growth?

A well-crafted business model is essential for rapid and sustainable growth. It outlines the company’s value proposition, revenue streams, cost structure, customer segments, and channels to market. Here’s how to create a model that supports growth without compromising quality or efficiency:

5 Best Practices for Building a Scalable Business Model

1. Define Your Value Proposition: Clearly articulate the unique value your product or service offers to your target customers. This should be compelling enough to drive demand and customer loyalty.
2. Conduct Thorough Market Research: Understand your target market, competitors, and industry trends. This will help you identify opportunities, potential challenges, and the best strategies for growth.
3. Build a Scalable Revenue Model: Develop a revenue model that can support rapid growth without sacrificing profitability. Consider factors like pricing, sales channels, and customer acquisition costs.
4. Optimize Your Cost Structure: Identify areas where you can reduce costs without compromising quality. This might involve streamlining operations, negotiating better deals with suppliers, or exploring cost-effective technologies.
5. Prioritize Customer Experience: A positive customer experience is essential for repeat business and referrals. Focus on delivering exceptional value and building strong customer relationships.

Reliable Planning, Research, and Testing Methods

1. Business Model Canvas: This visual tool helps you map out the key components of your business model, making it easier to identify potential weaknesses and areas for improvement.
2. Customer Interviews: Talking directly to potential customers can provide invaluable insights into their needs, preferences, and pain points.
3. Market Surveys: Surveys can help you gather quantitative data on market size, customer demographics, and competitive landscape.
4. A/B Testing: Experiment with different versions of your product, website, or marketing campaigns to determine what works best.
5. Lean Methodology: This approach emphasizes rapid experimentation, iterative development, and customer feedback to validate your business model and minimize risk.

By following these practices and utilizing reliable research and testing methods, you can create a business model that supports rapid growth while maintaining high standards of quality and efficiency.