To expand or not to expand, that is the question

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The federal government is aiming to clean up pollution caused by ore reduction mills similar to this one, often resulting in litigation. Photo credit: UC- Berkeley, Bancroft Library.

The federal government is aiming to clean up pollution caused by ore reduction mills similar to this one, often resulting in litigation. Photo credit: UC- Berkeley, Bancroft Library

Choosing to go into business for yourself means a willingness to ride the ebbs and flows of unpredictability. Some of those rides can be pretty challenging, and the start-up period is no doubt the first and perhaps the most daunting of them all. But it certainly isn’t the last. As your business grows, more tough decisions arise, including when and who to hire, how and when to scale, and whether or not you should expand and diversify your offerings. And as such, you will encounter things that, as a trained historian, you might not be as well-versed in: budgets, finance, and human resources dilemmas. In my experience, the question regarding diversification and expansion is really one about whether or not, as a business owner, you are prepared to pivot and endure the “start-up” phase again.

My firm recently had an opportunity to pursue a new area of growth. Although most of my firm’s work is in the environmental field, I decided to launch into historic preservation projects. Theoretically, historic preservation and environmental history go hand-in-hand, so on the surface, this was hardly a stretch. At the time, I also had someone on staff with a Master’s degree in Historic Preservation and years of experience, and I had served five years on our city’s historic preservation commission. We certainly were qualified for the work, and it seemed like a great corollary business to our existing and steady work in environmental litigation support. But there were some big differences that I did not anticipate and did not research in advance.

Prior to implementing this pivot, my firm’s business model relied rather heavily on word-of-mouth referrals and our strong web presence to bring in new clients. However, the field of historic preservation relies heavily on requests for proposals, and I found pretty quickly that for my firm to establish a reputation in the field, we would have to respond to requests from all around the country because there simply wasn’t enough work in Idaho. I quickly realized that there were problems with this model, the most glaring of which were the unexpected overhead labor costs and the hefty time commitment required to write a worthwhile proposal. Clearly, I had not anticipated the “start-up” costs of pursuing this new line of business.

The projects we were aiming to land were small compared to those we were accustomed to executing for litigation support, and as the firm’s principal, I came to realize that I was not nearly as enthusiastic about these types of projects. Yet, despite my initial lack of enthusiasm, my firm submitted quite a few proposals. Some were long shots at best, due, at least in part, to our physical distance from the project, the limits of the client’s budget, and the simple fact that someone equally qualified lived in the same state and would not have to rack up travel costs.

But as a business owner, the lesson I learned before pulling the plug on the experiment was more fundamental than all those details. Expanding your business is almost identical to starting it up in the beginning, with one major difference: now you have something to lose! Your brand and your expertise are, at least in part, what will set you apart. If you attempt to become all things to all people, you might dilute the very thing you’re best at. I recognized fairly early in this pivot that I did not want to allow the business to become significantly less profitable over an idea that I was not passionate about and which would dilute my brand. I also recognized that I had to be mindful of how diversification could threaten my existing employees’ and my livelihoods. In the end, I reached the conclusion that maintaining this second channel of business was not a smart business decision and did not generate the kind of excitement and passion that the firm’s main channel of business did.

My firm recently completed a centennial history for Idaho Power Company, including a traveling exhibit and website. Image credit: Courtesy of Jennifer Stevens.

My firm recently completed a centennial history for Idaho Power Company, including a traveling exhibit and website. Image credit: Jennifer Stevens

As a historian, I talk a lot with students and young professionals about following your passion, despite the naysayers who seem to think we all need a practical education with specific skills training. As a business owner, I also understand the logistics of running a profitable and scalable venture. I have been lucky to find a way to channel my passion for the field of environmental history into a practical and profitable business.

If you’re one of the lucky people out there who has a passion and recognizes it, you can do no worse service for yourself than to squash it and pursue a “practical” job. The pivot I briefly pursued fell into this category; I believed that it would be a practical and easily executable venture. I also mistakenly believed that with the basic infrastructure in place to run a business, it would be easy to expand into a new and related service. But I soon recognized that a great deal more forethought was needed before risking an existing business. And in this process, I also reaffirmed my passion about environmental history and litigation.

However, the biggest takeaway was that any attempt to scale and grow a business takes an equal, if not greater, amount of planning, foresight, and research as the initial start-up period. I believed that because I had an operating business, diversifying the firm’s services would be “easy.” But it’s not easy. The firm’s latest expansion–into corporate and community histories–is one that I spent a great deal more time planning for. I and my current staff can collectively get behind it more easily because it’s an expansion about which we are all more passionate and which we will be able to scale within more manageable parameters. Still, that first expansion experiment left me a little weary and made me realize the value of a nice, steady business.

Jennifer Stevens, PhD, is principal, SHRA/Stevens Historical Research Associates. Thanks to HannaLore Hein, M.A. and Stephanie Milne-Lane, M.A. for their valuable contributions to this post.

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