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A COMPANY´S LIFECYCLE MODEL
Companies go through different development stages overtime and nowhere is it said these
phases should coincide with an industry´s development stages
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This would help them manage change more effectively and apply
different approaches to be successful
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Each is unique and
represents a challenge from a different perspective
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)

Seed Stage

It starts when a business idea is born
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However,
before starting it, it would be reasonable to verify the feasibility of your business idea
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An entrepreneur must imagine the whole process and make sure there is a match between the
business scope and his personal background experience, skills, and passions
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Having a clear idea how the venture will be financed and what resources you will need in the
first months of operation is critical given that during this period the new company will likely
operate producing no revenues and will incur significant costs
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If everything goes well in the seed stage, you can form a start-up
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Start-up

company studies have shown this is the riskiest stage over the entire lifecycle
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Usually during the start-up phase
the firm can take one of its products or services to market and see if clients perceive it in a
positive way
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In addition,
the firm must focus on building a lasting relationship with its first clients
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The time to take products to market is

crucial at this stage as it would allow the company to register revenues and cover some of its
expenses
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)

Growth Stage

Once a company takes its product to market and start selling it to an increasing number of
customers, it enters the growth stage
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Two conflicting phenomena occur
here; the company needs its founder’s attention from multiple issues like customer
satisfaction, management, administrative tasks, management of daily activities and employee
feedback
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It is for this reason that companies begin hiring personnel who can take over some of the
founder´s responsibilities
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It's highly likely the company must invest in new management and accounting systems at this
stage to cope with increased competition
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4
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The focus falls on implementing sound business practices
and on boosting productivity through automation and outsourcing
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5
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It consists of geographical expansion or expansion across other
products or distribution channels
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Maturity

It is characterized by stable sales and profits
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The beginning of the maturity phase is
when they make the most money
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Many mature companies try to sustain their business by finding new business opportunities
and fuelling the growth of the mature part of their business
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