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The $100 MBA Show
MBA2620 How To Save Your Business From Going Out Of Business
00:09:52
Is your business on the brink, and you’re feeling the heat? Profits are slipping, costs are climbing, and time is running out to turn it around. If it feels like your business is hanging by a thread, this episode is a must-listen.
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- [00:00]
Ryan Reynolds
Ryan Reynolds here from Mint Mobile with a message for everyone paying big wireless way too much. Please, for the love of everything good in this world, stop with Mint. You can get premium wireless for just $15 a month. Of course, if you enjoy overpaying, no judgments. But that's weird. Okay, one judgment anyway. Give it a try@mintmobile.com Switch upfront payment.
- [00:22]
Narrator
Of $45 for three month plan equivalent to $15 per month required intro rate first three months only, then full price plan options available, taxes and fees extra. See full terms@mintmobile.com got a 7am meeting.
- [00:33]
On a Monday expensing breakfast because it's in policy, wasting all afternoon submitting an expense report for that breakfast. If your company used Ramp, you could submit expenses with just a text.
- [00:51]
Jim
Yay.
- [00:53]
Narrator
Free your team from expense reports today. Switch your business to ramp.com.
- [01:02]
Omar Zenhom
If your business is 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 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 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 peace time 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. 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.
- [04:41]
Narrator
And we're back, folks. It looks like Jim from sales just got in from his client lunch and he's got receipts.
- [04:47]
His next meeting is in 2. 2 minutes. The team is asking, can he get through his expenses in that time?
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He's going for it.
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Is that his phone?
- [04:54]
He's snapping a pic. He's texting ramp.
- [04:56]
Jim is fast, but this is unheard of.
- [04:58]
That's it. He's done it. It's unbelievable on ramp.
- [05:02]
Expenses are faster. Than ever, just submit them with a text. Switch your business to ramp.com.
- [05:13]
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 out 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 to close the gap, get some wins, get some upsells, 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 three, 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 peacetime. 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 4. 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 got to 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 going to 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 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.
- [11:27]
Narrator
Got a 7am meeting on a Monday.
- [11:29]
Jim
Boo.
- [11:31]
Narrator
Expensing breakfast because it's in policy.
- [11:33]
Jim
Yay.
- [11:35]
Narrator
Wasting all afternoon submitting an expense report for that breakfast. If your company used Ramp, you could submit expenses with just a text.
- [11:46]
Jim
Yay.
- [11:49]
Narrator
Free your team from expense reports today. Switch your business to ramp.com.