5 ways to infuse your business with entrepreneurial spirit and encourage explosive growth, from Chattanooga incubator Lamp Post Group
Want to know the secret to explosive growth? Look to companies like Lamp Post Group for clues.
The founders of Lamp Post Group weren't content with the success of their initial venture, logistics company Access America Transport. They wanted something more, something bigger.
Apparently, they figured out how to achieve just that. In just 10 years, the founders created a $400 million-a-year enterprise by capitalizing on the strengths of Access America Transport and using excess revenue to create Lamp Post Group. The venture is set up as an incubator of sorts, where all the companies share certain back-office and structural elements, which allows them to strategically expand into new opportunities while protecting their core business.
I recently had the chance to tour this amazing set of companies, set in a beautifully restored historical building in downtown Chattanooga, Tennessee. Their approach provides insight into how you can find ways to build your own business.
Secret No. 1--Invent New Revenue Streams
When Lamp Post Group has a problem it needs addressed, it looks for a company that will fill the niche--and brings it into the Lamp Post fold. Lamp Post Group then figures out how to sell that service to other companies. After all, if Lamp Post Group has the problem, then other companies must be experiencing the same pain.
An example of this is identifying great new employees to fill entry-level positions.
Lamp Post Group is supporting the company Campus Bellhops, which tracks college students as they perform odd jobs throughout their college career--including moving students in and out of dorm rooms and performing maintenance jobs around campus. Once the job is completed, the student is rated on his or her service, and Campus Bellhops keeps a history of the student's work performance. Not only does Campus Bellhops provide Lamp Post Group with a brand-new revenue stream, but it also gives Lamp Post Group access to cream-of-the-crop students to fill its open entry-level positions.
Secret No. 2--Empower Employees
The structure of every part of Lamp Post Group is based on a pod concept--breaking functions down into small working groups with revenue and cost responsibilities. This is a great way to encourage learning across the organization.
Newer employees learn from more seasoned employees by overhearing conversations with others and through informal "training" opportunities. The structure makes it obvious to employees how they move "up" in the organization, but to an outsider, the hierarchy is invisible. This approach is a way to simultaneously provide structure and a team approach while making every part of the organization its own microbusiness.
Secret No. 3--Remove Barriers
When an entrepreneur starts a company, suddenly he or she is expected to be experts at many areas that he or she is not or that he or she doesn't enjoy.
Lamp Post Group has centralized back-office and technology functions, allowing individual entrepreneurs to concentrate on what they do best. There is no need to learn how to perform HR functions or send out an invoice. These services are provided by Lamp Post Group.
Secret No. 4--Capitalize on What Is Already Built
Lamp Post Group is continually benefiting from components of its existing business by finding new ways to monetize every aspect. Not only does it provide back-office functions to burgeoning entrepreneurs, but it can also serve as an outsourced back office to any other company looking for the same services.
Lamp Post Group moved from the Chattanooga suburbs to take advantage of and revitalize thousands of square feet of decaying buildings in downtown Chattanooga that just happen to sit on one of the fastest fiber backbone installations in the United States.
Understanding how to recognize and capitalize on excess capacity and internal efficiencies is a smart way to maximize return on investment.
Secret No. 5--Identify a Specialty
Lamp Post Group's first company, Access America Transport, is a logistics company in the area of freight transportation. Through that work, executives identified a need for a transportation company that focuses on handling special government shipments (think arms and ammunition). So they built one.
Finding a customer, especially one like the U.S. government, with money and a need is the best way to establish a new line of business.
It is rare to find a company that has embraced and seeded the entrepreneurial spirit as deeply as Lamp Post Group has throughout its organization. It's easy to see how Lamp Post Group has built its enterprise to $400 million in revenue in just over a decade. Look to its lead for secrets on how to maximize your company's growth.
ERIC V. HOLTZCLAW is a serial entrepreneur who has founded multiple startup companies, including one of the first profitable Internet enterprises. His last company appeared on the Inc. 5000 list three years in a row. Eric advises clients on the “whys” of business – why customers buy, why teams work and the all-important “entrepreneurial why”. He is the author of Laddering and his weekly radio show, The 'Better You' Project, shines a spotlight on entrepreneurs' individual business journeys and successes. Learn more about Eric at www.ladderingworks.com or e-mail firstname.lastname@example.org. @eholtzclaw