Confessions of an Entrepreneur: The First Order of Any Business is Survival
March 19, 2020 | By Mark Zweig
It’s time for some real honesty now. As a business owner, creditor and debtor with the COVID-19 virus threat in full swing, I can admit that I’m scared. The business I own has ground to a halt. And the business that I used to own but sold my interest in and owes me has slowed considerably.
Everything is leveraged to the hilt and cross-collateralized. Maybe I should have been a bike mechanic? Maybe I should have been a postal worker? Maybe I should have just worked somewhere and kept my head down and lived in the $2200 mobile home I bought when I was in college?
Maybe I should have gone into completely different businesses — ones that would do well at times like this? The truth is I have no regrets. My businesses have given my family a pretty good life for the past 40 years.
But now I’m 62 years old with two ex-wives and a family to support. This is the last event I was prepared for. Usually there is some warning when things are slowing down and if you are astute you can prepare for it. Just a month ago, we had a great economy, didn’t we?
And I’m not alone. There are millions of other people—business owners large and small—who are in similar or worse situations. What happens if we lose it all?
You know what? I’m not going to let that happen if I can help it. And I can. By taking action — and sheer willpower — I will fight — hopefully not to the death — but fight every way I can to not go down.
The first order of any business is survival. If you don’t do that — survive — you can’t fulfill your purpose-based mission — can’t achieve your lofty vision — can’t solve all those problems for your clients or customers — and can’t create all those great jobs in your community. Nor will you be able to enjoy the success and satisfaction when things turn around if you don’t survive. You have to still be in business.
Here are my thoughts:
One day at a time.
Successful entrepreneurs keep a long-range perspective. But when you shift into survival mode, you have to change that. Your focus needs to turn into one of “one day at a time.”
Each day you keep your doors open gives you a chance to turn things around. This means paying super close attention to cash flow and deferring every cash outlay you can. Just don’t spend or pay for anything you don’t absolutely have to.
It’s not going to be easy.
Times like these test us. The tough get going but the weak give up. You will have to make some difficult decisions in the days and months ahead.
Who stays and who gets laid off. Who gets paid and who doesn’t get paid. What will you be willing to actually do to bring cash in. How much new debt you may have to take on which could mortgage your future.
And how much you will have to work — precisely when your family who is probably scared and worried right now about their future needs you the most.
It’s not going to be pleasant.
Letting people go — especially good people — is one of the most depressing things I have ever had to do. I worked for a firm in Texas back in the 80s and had to let go 30+ people in one day. It was awful.
I went home feeling sick after telling people who had been there for 20 years and were making $50K annually that we had to let them go — when I knew they’d be lucky to get another job paying $5 an hour. It is also not pleasant telling people you owe money to — trusted suppliers and service providers who either sold you something or did something for you — that you can’t afford to pay them.
Just take these two things and put them at the top of your long list of unpleasant but potentially necessary things you will have to do to survive.
It will take a lot of personal sacrifice.
Now is not the time to live high on the hog. If you are serious about keeping your business alive and not going bust, you will have to do things you won’t want to do.
Give up your daily Starbucks. Drive a cheaper and more economical vehicle. Sell your collection of whatever. Cancel the family vacation. Rent out your vacation house. Rent out your basement to another family. Cash in your profit sharing fund. Sign up for more debt and guarantee it personally.
If you want to keep the machine that feeds you alive you will need to feed it. That means taking out less and doing with less and putting in more money precisely when you will have less of it to put in.
You’ll need a supportive family.
You will be going through a lot. This whole decline experience will probably be both depressing and stressful for you. That will affect your family.
They will be worried about their future and they will be worried about you. You need to be sure to give them the time and attention they need and you need to be sure they do the same for you. Best to talk about it and give them realism while at the same time not scaring them.
Remind them that none of your stuff really means anything as long as you are all healthy and have each other. Stuff can be replaced (or maybe shouldn’t be replaced even if you can one day do so)
You will quickly figure out who your friends are.
All successful people have some “friends” who are only there because of your status. If that status declines or diminishes entirely, or if you need help vs being the one everyone else asks for help—that is when you will find out who your real friends are.
The fake friends will abandon you. The real friends will be there to support you.
Your ego may have to take some bruising.
There is no question about it. Owning a profitable and growing business — one that may even bear your name — is definitely an effective way to glorify your ego. But contracting, selling off stuff, telling people you can’t pay them — those things will be a blow to your ego.
You better learn to take those blows. You will have to endure many of them. Those who can’t do what they must for their businesses to survive will be out of business and maybe for good.
It’s time to re-evaluate your life priorities.
The decisions you made in the past — both good and bad — are what got you where you are today. Now is a good time to re-evaluate those decisions.
Are you living a balanced life? Do you have good relationships with the people you care about? Do you control how you spend your time and who you spend it with? Do you have too much stress? Do you have too much stuff? Have you gambled too much in terms of the business risks you have taken on?
These and many more questions should be raised and answered so if you need to make changes you can start making them right now. And hopefully, you won’t make the same mistakes or kinds of mistakes going forward. Because life (hopefully) isn’t over. Today is the first day of the rest of your life. Get that life going the direction you really want it to.
This, too, shall pass.
Life has its ups and downs. This may be a down period for you — a big one — but it won’t last. Times will get better again.
Sometimes, with human nature being what it is, we must experience the valleys to fully appreciate the glory of being on a mountain top. And in the future, what you think of as your “mountain top” may be something different, and that’s OK.
We will get through this. And maybe when we do, our society will be better off. Maybe our businesses will be less fat, more attuned to our clients’ and customers’ real needs, more efficient in our work methods, and better using the technologies that we should be using.
And maybe we will all be a little less materialistic, a little more prudent, and a little more willing to devote our collective resources to helping others after this is over.