The Importance of Networking in Entrepreneurship

Networking is an Entrepreneur’s Best Asset

When working with boutique owners, I’m often asked, “What’s the best way to help my business grow and become successful?” The answer is business networking. To be an entrepreneur and lead your professional services firm to success, you need to network. 

Many founders and owners of professional services firms fail to recognize the importance of networking in entrepreneurship. It is possibly your best asset in driving your firm. Why? Business networking allows you to connect with and learn from others that share common challenges, experiences, and goals. Not only will you create relationships, but you’ll get the opportunity to learn from the successes and failures of others. 

Still unsure about why networking in entrepreneurship is worth it? Let’s look at what benefits it provides. 

How Business Networking Can Benefit You During Your Firm’s Lifecycle

Business networking must be part of each stage of the business lifecycle journey. You are wrong if you think you’ll only need to network during the growth stage. Boutique owners often fall into the mindset of “going it alone.” Yet, running a firm requires advice and support from many others throughout the journey. 

Here’s how networking benefits entrepreneurs during each stage:

Growth Stage

The United States Bureau of Labor Statistics claims that approximately 20% of small businesses fail in their first year. Yes, many factors can lead to this happening, including cash flow problems and insufficient product or service demand. Yet, a failure to network can be included in this list. 

If you want your professional services firm to see its second birthday, business networking can help you do that. By joining a mastermind group or attending industry events, you can better grow your business. 

Here’s how: 

1. Gain Access to a Growing Network

Successful entrepreneurs start networking close to home. Capitalize on your existing contacts, whether they’re friends, family, or the guy you met on vacation last year. This is how you open doors and expand your professional network when growing your business. Being an entrepreneur means accessing a complex system of connections that provide access to human, social, and financial capital. 

2. Bring Your Concept From Idea to Reality

Business networking also helps you bring your idea from concept to reality. When you have access to an extensive network of connections in the same industry or a similar one, there is a wealth of knowledge at your fingertips. You can harness the intelligence and experience of others who are in or have gone through the trenches like you. This allows you to transform your ideas into tangible business options and implement them faster.

3. Helps You Find the Right Team

It is a myth that great firms are started by a single brilliant person. To grow your professional services firm, you need the right team of people working alongside you. Networking and building professional connections will help you find these individuals. 

When speaking with boutique owners, I remind them that it takes a team to realize a dream. You need to pick your business partners as carefully as you choose your spouse. 

Scaling Stage

Scaling a business requires time, effort, and plenty of advice. This is when you will need to put systems and procedures in place to continue on the path of profitable development. During this time, you will define your core values and develop your firm’s client experience. Essentially, it is your firm’s make-or-break period. 

Leveraging a mastermind community when scaling a firm is extremely important. Learning from peers and mentors helps you find the right people and strategies to scale your firm even further. This is a time for continuous education and accessing collective knowledge. Scaling a business should never be a solitary task. The more support you receive through networking, the more successful you will be. 

Selling Stage

Networking continues to be beneficial even for entrepreneurs looking to sell their boutique firm. Creating a business exit strategy needs to be done with consideration and thought. Speaking to your professional network can open up opportunities for new exit strategy perspectives. Perhaps a connection will even introduce you to a potential buyer for your firm. 

Why You Should Join a Small Business Networking Group

Joining a small business networking group or a mastermind community like Collective 54 will help you grow, scale, and sell your firm bigger and faster than ever. We offer peer-to-peer mentoring, small group learning, and our C54 Business Exchange to encourage member’s firms to hire one another. Many of our members succeed by tapping into  business networking opportunities within our community. 

The importance of networking in entrepreneurship is clear — it empowers you with the tools, knowledge and relationships you need to drive your firm toward success. Boutique founders and owners who join mastermind communities are given the guidance they need to earn more, work less, and sell faster. 
For more insights on how to capitalize on networking to grow your business, join our mastermind community or purchase The BOUTIQUE: How to Start, Scale, and Sell a Professional Services Firm.