The Adrenalin Grass of Company Growth
Author and physician Donald H. Hilton described an interesting observation he experienced with his family on a safari in Africa:
While on a game drive along the Zambezi River, our ranger commented on the adrenaline grass growing along the banks. I asked him why he used the word “adrenaline,” and he began to drive slowly through the grass. Abruptly, he stopped the vehicle and said, “There! Do you see it?”
“See what?” I asked. He drove closer, and this also changed the angle of the light.
Then I understood. A lion was hiding in the grass watching the river, just waiting for some “fast food” to come and get a drink. We were sitting in an open-air Land Rover with no doors and no windows. I then understood why it was called adrenaline grass, as I felt my heart pound.
For the moment, let’s change the angle of light slightly on your business. Have you considered the possibility of danger lurking in your company’s growth enough to make you heart pound?
A few months ago I consulted with the CEO of a fast-growing product company in the online gaming industry. His business had developed a cool wireless device for the World of Warcraft addicts. After engaging in the 4M online experience, his X-RAY report exposed an interesting, but all too common revelation concerning the future growth of his company. Here are the benchmark results of his business compared to 400 competitors nationwide in our database:
Remember that 1500 foot ravine every business has to hurdle in its “adolescence”? Here it is in blue and white. Although my client currently experienced excellent growth, he immediately recognized that his EBITDA would drop dramatically in next three stages of revenue.
No Man’s Land is a stage that requires increased capital to fund growth – both physical capital, and human capital (new management) in order to access the higher profitability of subsequent revenue zones. My client knew he had an immediate decision to make: pull back on the reins and wait out the recession, or seek private equity to fortify his growth through the next three stages. He chose, as Economy Heroes often do, to throttle up!
This financial “ravine ramification” occurs with almost all companies, industry neutral. My client was fortunate enough to see through the adrenaline grass before he walked into it.
How’s the angle of light on your company’s growth? I know, you don’t scare, but don’t wait too long. Once you hear the growl, it’s too late.
Brent Sapp
