The global financial crisis has led to dramatic and ongoing changes in risk management among many technology and life science firms. As a result, most technology and life sciences business leaders face unprecedented challenges as they grow their firms from the early stage to maturity. However, we continue to witness the growing list of high-growth firms in this category and we believe they have unique insurance and risk management needs. These firms must make risk management central to their business at an earlier stage in the corporate life cycle in order to have the best chance for survival.

Rapid-growth companies aren’t afraid of taking calculated risks. They often learn how to turn risk into opportunity and find themselves doing that better than their competition. This means that before they jump into opportunities, they calculate the risks and are more aware of the potential consequences. Developing a corporate risk management approach at an earlier stage in the firm’s life cycle is crucial for ensuring the continued interest of investors and strategic partners.

A growth firm is recognized by its ability to increase its business by a significant amount very quickly, but it’s important to realize that there are challenges with such a fast increase in business. Demands for capital to increase and expand production, hire additional workers, increase locations and more are necessary to maintain high growth rates. Investors are usually asked to take a new look at a growth business and the potential it has for increased profits and cash flow.

A growth firm will experience increased market share and profits. It puts them in the position of decreasing competition. They will be able to better seek out the latest ideas and innovations in their industry. One important result is that higher skilled workers will want to be a part of a growth firm.

As a growth firm enlarges, its insurance needs will also tend to increase. It will be important to adjust insurance coverage as is necessary. Additional insurance products may be needed and adequate liability insurance needs to be in place as the company changes and grows.

Growth firms do many things to maintain their momentum. Having a risk management plan that changes with your organization is important. Contact a TechAssure Association member to learn about our special services for high growth firms.