Entrepreneurs face an existential dilemma every day that they are burning cash and looking for customers: should I shut the business down? There is quite a lot of life-death thinking going on in the head of a good founder all the time about the ongoing struggle to keep a company going. Running a startup is one part business plan, one part hustle, and two parts ongoing existential crisis. Leading one of these companies means being like the proverbial duck on a pond—the rest of the company sees you calmly floating along, but underneath you’re paddling like crazy.
A lot of startup folks talk about “keeping a company afloat” like it is a leaky boat we have to constantly bailout, but I prefer to think of these companies as starving children that always need food. Sometimes, some months, it’s a very close call. I lie awake at 3 am and wonder, “How am I going to make payroll this time?” Then, after that dark night, I put on my shoes, grab my bag and get an order. Revenue is like the elixir of life to these babies. Spoon a purchase order into the ever-hungry mouth, and the color returns to her cheeks. Suddenly, magically, payroll is next month’s problem.
You make do. You go without salary for long periods. Vacations do not happen. You’d visit a customer and sleep in your car if you thought it would stretch the cash further (can’t say I’ve done that one, but I have thought seriously about it a few times. I did know one guy who slept in his motor home in the parking lot outside his office for years to make a go of it). You don’t hire cleaning people, but instead, clean the bathrooms yourself. Early mornings, before everyone gets in, are a great time to empty the trash.
A CEO who empties trash is not exhibiting self-sacrificial, “above-and-beyond” effort. Thinking of your work as sacrifice implicitly creates an expectation of reward later on—it’s a form of debt. That’s bad business. The same goes for getting noticed as a reward—that’s taking credit, and credit is just another form of debt. Why saddle your company with unnecessary debt? Doing the work and calling it “sacrifice” means you don’t have the mindset; it means “you’re owed” something. A good entrepreneur does what it takes to move the company forward and keeps any judgment surrounding the type of work to himself. I see a lot of people who get caught in the trap of wanting to “be” a CEO or an EVP, but neglect the genuine (and vital) part of “doing something.” Wanting to “be someone” and “doing something” are usually mutually exclusive. If “being someone” means that buying office supplies in bulk at Costco is someone else’s “do,” then running startups is probably not for you. Instead, take your talents to Google—free food and massages!
The answer to the “do I shut it down” question is always another question: “what am I doing, right now?” When you can’t do anything else, and you are out of options, that’s the time to shut it down. Companies don’t deserve to keep going just because of the Herculean efforts of a CEO. Businesses don’t deserve success because VP’s fly coach and chose Motel 6’s over Hyatts. The verb “deserve” does not belong in the entrepreneur’s dictionary. The decision to shut down a company is usually self-evident. The decision to keep it going? That is a day-by-day, moment-by-moment series of acts. Sacrifice, however, is not one of them.