MBA2620 How To Save Your Business From Going Out Of Business

Summary

Podcast Summary: The $100 MBA Show - MBA2620 "How To Save Your Business From Going Out Of Business"

Release Date: May 5, 2025
Host: Omar Zenhom
Title: How To Save Your Business From Going Out Of Business

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Introduction: Navigating Business Crises

In episode MBA2620 of The $100 MBA Show, host Omar Zenhom delves deep into the crucial strategies entrepreneurs must employ to rescue their businesses from the brink of failure. Drawing inspiration from Ben Horowitz's seminal work, The Hard Thing About Hard Things, Omar distinguishes between "peacetime" and "wartime" leadership, offering actionable insights for CEOs facing dire circumstances.

Peacetime vs. Wartime Leadership

Omar begins by outlining the fundamental differences between running a business during stable times (peacetime) versus during a crisis (wartime).

• Peacetime CEOs focus on long-term strategies, brand building, team morale, and creating a sustainable culture. This approach emphasizes growth, innovation, and maintaining a steady trajectory.

• Wartime CEOs, on the other hand, prioritize survival, rapid decision-making, and relentless execution. In crisis mode, the usual protocols are set aside to address immediate threats to the business's existence.

Notable Quote:
"Peacetime is when your business is humming along... Wartime is not business as usual."
— Omar Zenhom [00:59]

Step 1: Cut Relentlessly and Immediately

The first and most challenging step in salvaging a struggling business is to cut costs and eliminate non-essential elements. This includes:

• Reducing Features and Tools: Streamline your product or service by removing features that do not directly contribute to revenue.

• Trimming Expenses: Identify and eliminate unnecessary expenditures to balance the budget.

• Staff Reductions: If necessary, let go of team members who do not have a direct return on investment (ROI) in the current crisis.

Notable Quote:
"In wartime, you're making less than what your costs are and you need to cut down your costs again."
— Omar Zenhom [02:15]

Omar emphasizes the importance of making swift and sometimes harsh decisions to stabilize the business, referencing Ben Horowitz's assertion that wartime CEOs do not wait for consensus.

Step 2: Shift Focus to Revenue Now

Once costs are under control, the next priority is maximizing revenue through immediate and practical actions:

• Stop Experiments and Side Projects: Focus solely on core activities that generate income.

• Enhance Customer Engagement: Improve support, onboarding, and communication to ensure customer satisfaction and retention.

• Leverage Existing Customers: Upsell and cross-sell to your current client base to boost revenue quickly.

Notable Quote:
"Don’t go quiet in this moment. You want to go loud. You want to talk to as many customers as possible."
— Omar Zenhom [05:35]

Using his experience with Webinar Ninja, Omar illustrates how prioritizing customer success and intensive support efforts can bridge revenue gaps and propel the business forward.

Step 3: Over Communicate with Your Team

Effective communication becomes paramount during a crisis. Omar outlines strategies to ensure the entire team is aligned and motivated:

• Daily Meetings: Implement daily stand-ups or team meetings to keep everyone informed and focused.

• Transparency: Be brutally honest about the business’s situation and the necessary steps to overcome the crisis.

• Set Clear Expectations: Make it clear that the coming months will require extraordinary effort, and ensure every team member is committed.

Notable Quote:
"We have to call a daily standup, a team meeting every day, so that everybody's on the same page."
— Omar Zenhom [08:20]

Omar recounts how open and honest conversations with his team at Webinar Ninja fostered unity and collective effort, ultimately leading to the company’s acquisition by Proprofs.

Step 4: Be Willing to Burn the Manual When Needed

Rigid adherence to established protocols can hinder rapid response during a crisis. Omar advises leaders to:

• Prioritize Speed and Agility: Make decisions quickly, even if it means bypassing standard procedures temporarily.

• Focus on Execution: Emphasize swift implementation of strategies that can save the business, rather than seeking perfection.

• Adapt as Needed: Recognize that some decisions may later require refinement once the immediate threat has been averted.

Notable Quote:
"Leadership under fire isn't about perfection. It's about making the next right move."
— Omar Zenhom [10:15]

This flexible approach allows businesses to adapt swiftly to changing circumstances, ensuring survival during turbulent times.

Conclusion: Building Resilience Through Crisis

Omar wraps up the episode by highlighting the transformative nature of crisis management. While wartime leadership is undeniably stressful, it forges resilient entrepreneurs capable of navigating any future challenges. Surviving a business crisis not only saves the company but also enhances the leader’s capabilities, preparing them for sustained success in peacetime.

Closing Remark:
"Those moments that I'm most proud of, not the wins, it's getting out of the trough of sorrow."
— Omar Zenhom [11:35]

Omar encourages listeners to embrace these tough times as opportunities for growth and to remain steadfast in their commitment to saving their businesses.

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By following Omar Zenhom's strategic framework, entrepreneurs can effectively steer their businesses through crises, ensuring not only survival but also laying the groundwork for future prosperity.

Transcript

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[Omar Zenhom]

On the brink of going out of business, this episode might just save it. Not with hype, not with theory, but with real battle tested leadership. Ben Horowitz, in his book the Hard Thing About Hard things says peacetime CEOs know that proper protocol leads to winning. Wartime CEOs violate protocol in order to win. And right now, if your business is struggling on the brink of going out of business, you are are in a war. And wartime is not business as usual. It's not like it was before when things were great. So you need to act differently during wartime. Today we're to talk about exactly what you need to do when the enemy is not a competitor, but the end of your business itself. There's no time to waste. So let's get into it. Welcome Back to the $100 MBA Show. I'm your host Omar Zenholm where I deliver practical business lessons three times a week, Monday, Wednesday and Friday to help you start, grow and scale your business. Let me explain this very clearly. Peacetime is when your business is humming along. Everything is fine, you're profitable and that's when you're peacetime CEO. You're focused on long term strategy, building a brand, team, morale, culture, all that stuff. Good stuff. When you're in a wartime where your business is about to fold in a few months because you're not making enough profit, you need to be a wartime CEO. A wartime CEO focuses on survival, speed to hard decisions. They're relentless with their execution. You don't run the business the same way in both situations. And I'm speaking out of experience. I've been there in my 10 year run of building Webinar Ninja before we got acquired by Proprofs. I hit a wall in revenue growth, planned, our costs were high, Churn was creeping up and I had a choice. Keep managing my business like it was peacetime. Now listen, I want to make this very clear. I'm not trying to be aggressive for aggression's sake, right? We don't want war, we don't want to be in this situation. But when we find ourselves in a war situation, we can't act the same way. We have to do different things. And I want to make sure that this is clear and give you a game plan so you can get out of this situation and get into peacetime again very quickly. Let's start with the first thing you need to do and that's cut relentlessly immediately. Okay? This is where it gets hard and this is why it's the first thing you got to do because it's going to make the most impact. I'm talking about cut features, cut tools, cut costs. Yes, even team members if you absolutely must. And this is where it gets tough, like I said. But if there is no direct ROI correlation to that team member in wartime, they need to get cut. Because basically wartime means you're making less than what your costs are and you need to cut down your costs again. Ben Horizon says that wartime CEOs make fast, often harsh decisions without waiting for consensus. This is a hard one because you have to reconcile the fact that peace will come later. But right now survival comes first. You gotta stay alive. You can't save a business by trying to please everybody. And you're going to do some stuff that you don't normally do because this is not a peace time. You're going to have to cut costs, you're going to have to cut some people. Sometimes you're going to have to make some tough decisions that are going to save your business. Why? Because the decisions you made up to this point led you to this point, led you to the fact that your business is about to go under. So you can't do the same thing. You got to do something different to get a different result.

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[Omar Zenhom]

Step 2 Shift focus to Revenue Now. Forget experiments. Forget side projects, Forget polish. Right now, when going out of business is knocking at the door, you need to ask some really important questions. What can we sell right now that solves a real pain for maximum revenue. Back when we were struggling in webinar Ninja and plateauing, we paused feature development and we focused all our efforts on getting customers results as fast as possible. For us, that looked like beefing up our efforts with support, with onboarding, with webinars, with education, with one on one calls with our customers. That allows us to close the gap, get some wins, get some upsell, sell products to existing customers. And it allowed us to really kick up dust and make something happen, save the situation. And that catapulted us to another level of business. Don't go quiet in this moment. You want to go loud. You want to talk to as many customers as possible. Sell as much as possible, serve as much as possible to your customers. You want to crank up the volume of your service as high as possible. Turn that dial to max. Because right now you need to make as much revenue. And right now the best way to do that is to tap into your existing leads and customers. Step 3 over communicate with your team in wartime, people need clarity and direction. Your team is looking to you for leadership. You can't disappear. You gotta be there for them and you gotta communicate the situation. You need to call a daily standup, a team meeting every day, daily, so that everybody's on the same page. We're all marching in the same direction. We want to update them, the whole team, constantly throughout the week. We want to be brutally honest with them with a plan. This is what we're doing. And when you're in the thick of it, as I said to my own team, I had to say to them, we're not dying, okay? We're not going to end this business. We've all worked way too hard for this to tank, okay? We're going to catch this before it starts to move in the wrong direction. And we're going to do everything we can with different action. But we need every hand on deck. No passengers, all crew. We're all rowing in the same direction. And you need to talk to them and be honest with them that this is going to be a tough time. This is going to be hard work. The next few months. We're going to work harder than we ever worked before. But there'll be time for retreats and fun and time off and all that stuff once we get back to peacetime. That unity really pulled us out and into a different level of playing. We were playing a different game at that point, and we were basically unstoppable. And we're able to just do anything we were able to do or be able to achieve the goals we had to get to that peace time. And I'm thankful to say that we did grow from that time. We did move up from that situation and grew beyond that point. But you're going to need to have some honest conversations with your team. This is the time for you to just level with them. I remember reading in Ben Horowitz's book the Hard Thing About Hard Things, he sat down with his team members and said, talk to your spouses, talk to your family. Tell them that the next few months are going to be tough. They're going to be long hours. Be honest, Just set up expectations. And you got to just give them a choice. Are you in? Are you out? Because if you're in, we're all going to go for it. We're all going to work hard all together. We can't have somebody who's halfway through. And if you're halfway, no problem. You know, we can say goodbye right now. It's harsh, it's tough, but you have no choice. That's the point. The choice you have is go out of business or please somebody. No, you need to right now make sure your business is saved. And that requires honest conversations. Step four, Be willing to burn the manual when needed. All those protocols and processes you created in peacetime, they were good for peacetime and they're good for the future. But right now, sometimes you're going to have to skip over them. Right now, they might not matter as much when time is against you, when you're days away, months away from going out of business. You need speed, agility, matters Execution matters. If a decision helps the business survive and it's illegal and it's ethical, you gotta do it. You can fix the polish or the roughness of it later. This is the hard thing about running a business, is that sometimes things are gonna get tough. And leadership under fire isn't about perfection. It's about making the next right move. And then as you get out of this situation and you're in more of a peaceful situation, you can have more time to to deliberate your moves where you can make better decisions. But right now we want to make the best possible decision under the pressure and time constraints you have. Look, if you're here right now still listening to the words I'm saying to you, you already have what it takes. I can tell being in wartime mode is scary, okay? It's stressful. I look back at it, I'm like, oh man, I never want to be there again. It's something that. It's very, very stressful. I'm just going to tell you right now that's how it is. But it's also clarifying. It shows you what matters in the moment, who matters and what you're made of. It's those moments that I'm most proud of, not the wins. It's getting out of the trough of sorrow. And you know, those tough times. And if you make it through, and I believe you will, you'll be 10 times the leader you were before. Because peacetime builds a business. A really beautiful, smooth running business. But wartime builds entrepreneurs. It builds people that can get through anything, no matter what. The business is the next business, the next business, the next venture. If you found this episode helpful. If you want to continue to learn from me, I encourage you to subscribe to our three Things newsletter. It's my way to coach you from afar with weekly guidance. And it's designed to help you move forward every single week. Every week, I'm going to give you three things. Something to think about. Something to change your mindset. Something to do so that you're moving forward every week. And something to learn so that you're skilling up and becoming a better entrepreneur. You're not alone in this. I got your back. Now go out there and win your war.

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