5 Stages of a Business Owner Over the lifecycle of any business, the financial and insurance needs of the business and business owner change. According to Neil Churchill and Virginia Lewis, authors of the Harvard Business Review article, The Five Stages of Small Business Growth, business owners frequently experience common problems arising at similar stages in the development of their enterprise. Use the chart below, which references the HBR article, to identify which stage your business is in and the typical concerns and financial needs of most business owners at that stage. Owner is usually operating with minimal support staff and struggling to survive.
Needs are typically for personal insurance to protect owner's family.
Although a degree of stability has been reached, the owner's primary concern is cash flow. However, the value of the business has grown to a point where is it necessary to protect and preserve the business. Although cash flow is always a concern, the business owner's focus then turns to growing and maintaining the business's success. Attracting, rewarding, and retaining top-performing employees are now major concerns. At this stage in the game, the business owner's primary concern is with the expansion of the business.