Fred Wilson’s now classic post What a CEO Does, argues that a CEO really only needs to do three things:

  1. Sets the overall vision and strategy of the company and communicates it to all stakeholders.
  2. Recruits, hires, and retains the very best talent for the company.
  3. Makes sure there is always enough cash in the bank.

At first glance, you might think this is an overly simplistic way to look at the role of a CEO in a fast growing company, but when you think about what you spend most of your time on, your activities probably boil down to one of these three things  —  or at least, they should.

From my experience building companies over the last 15 or so years, I want to share a few tips to get better at each of Fred’s three things. It’s important to keep in mind that like anything, the more you practice, the better you’ll get  —  especially if you’re a first-time CEO.

Setting the vision and strategy

  • Don’t assume everyone in your company knows what’s going on inside your head  —  they don’t, so you have to communicate your vision and strategy until your employees (not just your leadership team) are literally sick of hearing it and can recite it back to you.
  • When communicating your vision and strategy, don’t just talk about numbers and products. Tell your people why your vision and strategy are important to you, them, your customers and investors and show them how their role fits in.
  • You understand the market, the competition and the rate of change better than anyone in your business  —  that’s why you’re the CEO, so you need to keep that in mind and realize that while you live and breathe your business, not every single one of your employees will.
  • It’s best to have a regular cadence of all-hands meetings where you constantly discuss your vision, strategy and progress. This is especially important if you’re growing fast and/or hiring new people regularly  —  you want everyone in the company to be aligned and nothing does that better than hearing from you, their CEO.
  • Try your best not to flip-flop between strategies too often. It’s inevitable that the market will change and you’ll want to zig instead of zagging, but try to limit a complete change in strategy to no more than once a year. The bigger your company is, the harder it becomes to turn the ship to go in the direction of a new strategy, meaning additional cost, complexity and confusion for your employees.

Recruiting the best talent

  • It’s best to be actively involved in the recruiting process for roles you determine as critical. Whether that’s making the initial contact, jumping on a plane to meet a candidate, or conducting the final interview to sell her on your vision. Don’t delegate everything to your team. The best candidates are in high demand, and getting face time with you can be the deciding factor in where they go to work.
  • Plan your new hires at least two quarters out if possible. There’s lead time to find amazing people, regardless of whether you have a strong network or not.
  • The best people don’t take a new job because you have a great kitchen or a chef  —  they want to work in industry-defining companies with a big vision and huge potential upside where they can make an impact. Sell that possibility aggressively.
  • As Ben Horowitz mentions in his excellent book, The Hard Thing About Hard Things, try to find someone who will be good for the next 18 months of your company’s growth. In 18 months you’ll be a completely different company, so there’s no point thinking too far beyond that.
  • Focus on the person you’re hiring more than their resume. What makes them tick? What are they passionate about? Are they humble despite huge success in the past? What do they value and how do they handle tough situations? Skills can be taught, personalities cannot be changed.

Having enough cash

  • If you raise money, it should last at for at least 18 months of bad times. In other words, if everything went to hell in a hand basket, have enough cash for that scenario, not the perfect scenario where your sales grow 500% in the next year.
  • There’s a fine line between fast growth and spending too much money. You can grow fast while keeping your cash burn in check and it’s better to grow slightly less than having to fire half of your people because you’ve overspent and can’t raise another round of funding.
  • Most fast growing companies spend a lot of money on sales and marketing without first proving ROI. Instead, test multiple channels with small budgets and when you’ve found a strong ROI (ideally 3x or more), scale that channel aggressively.
  • If your goal is to build a big business that can be acquired or taken public down the track, focus your remuneration more on equity than cash, especially for executives  —  you want them to be aligned around creating future value which they can share in.
  • The earlier you can understand where you’re cash efficient and where you’re not, the sooner you can fix those leaky funnels and spend your cash more wisely.

Of course, there’s a lot more to building a fast growing company than just Fred’s three points and my tips for each, but hopefully you find them useful.

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6 Most Important Considerations for Starting a Fitness Business

Starting a new business can be thrilling and challenging. It could be terrifying when you think about all the details and every resource you need to get up and running. If you’ve done your research right, it will be easier to know what you are getting into and exactly what you need to succeed.

Most people choose to start their own businesses because they are ready to share their ideas with the public. And want to do what they love in their own way.

Others want to create a work-life balance that works for them. Ultimately there can be great opportunity to make money if everything goes as planned. The risk is worth it, most of the time for people who are entrepreneurial.

According to The Guardian, consumer spending on UK gym membership soared by 44% in 2014, driven by the growth in popularity of new, budget gyms.

The demand for affordable, high quality, no-contract or flexible contracts fitness centres is continuing to grow. People are now interested in staying fit more than ever. The popularity of budget gyms, including Pure Gym, EasyGym, Anytime Fitness and DW Sports, are most likely driving the increase even further.

If you are thinking about going out on your own and starting a fitness business this year, this will help you get started.

Find your niche

1. Decide on your niche market right from the beginning 

Which market do you want to serve and why? This should be very clear to you. Do your research and find out a profitable niche that can scale. Weight loss is popular. There are other less popular ones like injury management and even endurance athletes. You could also choose powerlifting, crossfit, yoga, or whatever you prefer that works for you.

But remember, going after a popular niche means more competition. It should be a niche you are genuinely interested in. That way making it a business won’t be difficult.

The planning process

Launching a brick and mortar fitness business can be overwhelming but once you get your planning right, you will be off to a great start. Put everything on paper. It pays to keep records.

2. Cost

Consider your fix costs (business registration, legal fees, rent, premise renovations, utilities, hiring and educating trainers, wages, décor items and furniture, initial marketing) and monthly expenditures.

What will be your monthly protected costs? How will you fund the business before you attract paying customers? How many active clients will you need to break-even or generate your desired level of profit? Think of every little thing that you will need to spend money on to before your business opens and plan a contingency.

Getting started right

3. Purchase appropriate equipment

Make a list of all the equipment you’ll need to get started. JLL Fitness have a great range of commercial gym equipments you can check out. Things like dumbbell sets, bars, exercise mats, weight benches, treadmills etc. cannot be compromised. They are the most important things you need for a fitness business.

4. Make it insanely easy to register

Set up a a great and easy to use website to educate and inform prospective clients of your offering and packages. And most importantly give new users the opportunity to register and book fitness packages right at the comfort of their homes. Make it flexible. Your prices should be competitive.

Getting a website up and running is no longer a difficult or expensive. There are great DIY websites available, such as Wix and Squarespace. This is one of the first things you should do once you are ready to kickstart your fitness business.

5. On discounts and special offers

Attracting customers or users is one of the hardest part of starting a business. It’s no different for fitness businesses. Give people a reason to become members. Why should people choose you over your competitor next door?

Special deals and launch offers can be a great idea and really draw people in. You can offer a few days or even weeks for free and start charging once users establish fitness habits. When you are getting started, make it big, exciting and tempting. Set and stick to your urgent end date to get people signing up as soon as possible.

6. Focus on amazing service to leverage worth of mouth marketing.

The first few people who register for sessions at your fitness business can make or break your new startup. Give them the results they crave and make your sessions the best part of their week.

The aim is to get them talking about your fitness sessions to their friends. Word-of-mouth advertising is crucial for every service-based business, and in the case of a fitness business, it’s key.

Final words

Building a successful business takes time, focus, persistence. Starting a fitness business is probably going to end up costing more than you thought. But that’s not a reason to give up or abandon your dream career.

Do everything in your power to sustain the business once you get started. You probably won’t see profits for months. Plan for setbacks.

Focus on attracting and retaining clients and your business will grow as planned. And build a team of trainers who share your same passion and want to see your business succeed.

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