The $100 MBA Show - Episode: MBA2369 Q&A Wednesday: How Long Should I Keep Going Before I Quit?

Release Date: September 27, 2023

Host: Omar Zenhom
Podcast Description: Awarded Best of Apple Podcasts, The $100 MBA Show delivers practical business lessons for the real world. Host Omar Zenhom shares lessons, strategies, and insights from over 20 years of entrepreneurship, providing actionable advice on everything from validating your idea to marketing, sales, and reinvestment—all tailored for individuals with minimal resources.

Introduction to the Question

In this episode of Q&A Wednesday, Omar Zenhom addresses a pressing concern from one of his listeners, Everly. Everly asks:

“How long should I keep going before I quit? I’ve been doing it for about eight months. I’m losing much of my savings in the process and I’m not sure if entrepreneurship is right for me. How long do I need to stick it out before it’s time to quit?”
— Everly [01:26]

Omar identifies two distinct aspects to Everly’s question:

1. Should she quit her current business if it’s not yet profitable?
2. Should she abandon the idea of entrepreneurship altogether?

Part 1: Deciding to Quit the Current Business

Omar emphasizes the importance of persistence in entrepreneurship:

“The answer to this question, how long should I wait until I quit? The answer’s simple. Until… until you are successful, until you’ve made it and are able to sustain yourself, it becomes your livelihood.”
— Omar Zenhom [05:00]

He advises that quitting the business prematurely can lead to long-term dissatisfaction. Instead, entrepreneurs should evaluate whether the current trajectory is moving towards profitability. Key strategies include:

• Tracking Financial Metrics: Monitor revenue, profit margins, customer acquisition, and lead generation to assess business health.

  “You need to be tracking, of course, your financials, how much revenue you’re making, how much profit you’re making, the number of customers you’re having, how many leads are coming in.”
  — Omar Zenhom [07:15]

• Analyzing Trends: If losses are decreasing over time, it indicates potential movement towards profitability.

  “If the trend is moving in the right direction, it means you’re making the right investment. That means eventually your business will be able to be profitable.”
  — Omar Zenhom [09:30]

Omar illustrates with the example of major public companies like Uber and Slack, which operate without profit for extended periods due to strategic investments and growth plans. He underscores that while he prefers quicker profitability, he acknowledges that some business models require longer periods to turn a profit.

Part 2: Evaluating the Entrepreneurial Path

Moving beyond the current business, Omar discusses whether Everly should continue pursuing entrepreneurship as a career:

“Entrepreneurship is like any career. If you really want it, the answer to this question, how long should I wait until I quit? ... Until you are successful.”
— Omar Zenhom [03:15]

He encourages self-reflection to determine if entrepreneurship aligns with one's passion and resilience:

• Desire vs. Discomfort: Assess whether the desire to be an entrepreneur outweighs the challenges and discomfort it brings.

  “You just got to want it more than you hate the downsides.”
  — Omar Zenhom [03:45]

• Lifestyle Considerations: Recognize that entrepreneurship is a lifestyle that requires continuous effort without the natural breaks that traditional jobs offer.

  “If you’re an entrepreneur, it’s a lifestyle. You’re thinking about your business 24/7.”
  — Omar Zenhom [06:00]

Financial Considerations and Sustainability

Omar stresses the importance of understanding and managing the financial aspects of a business:

“If you can’t afford that much runway, that much loss over two years, then you might have to pivot the business.”
— Omar Zenhom [10:00]

He advises entrepreneurs to:

• Assess Financial Runway: Determine how long the business can sustain losses before personal finances are jeopardized.

• Consult Financial Experts: Work with accountants or financial advisors to project profitability and make informed decisions.

  “Speak to your accountant. Speak to a financial expert about this.”
  — Omar Zenhom [09:45]

The Power of Pivoting

Before considering shutting down a business, Omar recommends exploring pivoting as a viable option:

“There's nothing wrong with pivoting your business. ... It’s one of the first things you should do before you even consider closing the business down.”
— Omar Zenhom [12:25]

Drawing from Jenny Blake's book Pivot, he outlines how pivoting can help realign the business model to achieve profitability by:

• Altering Offerings: Introducing high-end services or products to increase revenue.
• Adjusting Strategies: Shifting focus based on market feedback and financial trends.

Omar shares his personal experiences with failed businesses, emphasizing the value of learning from these setbacks to improve future ventures:

“I’ve had businesses that crashed and burned, that ran out of money that I had to close down. And that’s okay. I kept going.”
— Omar Zenhom [13:50]

Final Insights and Encouragement

Concluding the episode, Omar reinforces the significance of perseverance in entrepreneurship:

“If you want something bad enough, you’ll figure out a way to make it happen.”
— Omar Zenhom [15:00]

He acknowledges the inherent challenges of entrepreneurship but highlights the potential rewards for those who persist:

“The most successful entrepreneurs grinded for 10, 15, 20 years, faced adversity, faced risks, challenges... and now they have a fantastic, rewarding, fulfilling life.”
— Omar Zenhom [15:30]

Omar encourages listeners to practice self-awareness to determine if the entrepreneurial path aligns with their personal goals and resilience.

Conclusion

In this candid and insightful episode, Omar Zenhom provides a comprehensive framework for evaluating whether to continue with a struggling business or reconsider the entrepreneurial journey altogether. Key takeaways include:

• Persistence is Crucial: Continue pursuing entrepreneurship until achieving sustainability and profitability.
• Data-Driven Decisions: Regularly monitor financial and operational metrics to guide decision-making.
• Flexibility Through Pivoting: Be open to altering the business model to enhance profitability before deciding to quit.
• Self-Reflection: Ensure that the entrepreneurial lifestyle aligns with personal aspirations and resilience levels.

Omar's balanced approach combines practical financial advice with motivational insights, making this episode an invaluable resource for aspiring and current entrepreneurs facing similar dilemmas.

Notable Quotes with Timestamps:

• “You just got to want it more than you hate the downsides.”
  — Omar Zenhom [03:45]

• “If the trend is moving in the right direction, it means you’re making the right investment.”
  — Omar Zenhom [09:30]

• “There’s nothing wrong with pivoting your business. ... It’s one of the first things you should do before you even consider closing the business down.”
  — Omar Zenhom [12:25]

• “If you want something bad enough, you’ll figure out a way to make it happen.”
  — Omar Zenhom [15:00]

• “The most successful entrepreneurs grinded for 10, 15, 20 years, faced adversity, faced risks, challenges... and now they have a fantastic, rewarding, fulfilling life.”
  — Omar Zenhom [15:30]

Connect with Omar Zenhom:
For more actionable business lessons and to submit your questions, visit https://100mba.net or email Omar at omar@100mba.net.