You Should QUIT and Find a Job

Hey, everyone, this is Mike Andes and you're listening to the Business Boot Camp podcast. Today we're going to be talking about when you should quit, when you should stop trying to run your business, when you should stop taking risks in your business, and when should you go do something else? Maybe that's get a job, maybe it's go start another business. But when should you stop the plunge that your business is in and the downward spiral? And when should you quit? Before we get into today's show, though, a big thank you to Gusto. It's our sponsor for today's show. If you haven't already, go to gusto.combootcamp I was just reading one of the comments from someone that said the biggest reason they switched to Gusto and something I haven't talked a lot about is that it integrates with QuickBooks. So if you do QuickBooks for your expenses and your invoicing and all of that, but yet you just can't handle their payroll stuff or it's too expensive, or it's not comprehensive enough to do benefits and all the other things you want to do for your employees, you can integrate. It integrates with gusto. QuickBooks and Gusto integrate together. And so I'd highly recommend you check out gusto.com bootcamp, try out the 90 day trial, integrate with QuickBooks if that's what you use, and see what it can do for you, your business, and your employees. And thank you to the gentleman that brought that to my attention about the integration that was the key for his business and for switching to Gusto. So today's question is actually coming from Small Business Owners of America, the Facebook group that I've started for all industries and really that we can learn from each other's industries, their problems, mistakes, etc. It's a private group and I probably only accept about one in three people that ask to join because a lot of people who try to join Facebook groups are spammers or they're just, they have their, you know, part of 450 other groups, I'm not letting them into the group. You have to be a small business owner. The thing I'm looking for really quickly is like, if it's in your bio, if it's in your feed, really quick. So, like, these are legitimate questions. You're not gonna get spammed by being in this group. There's only a couple questions or a couple comments every week, but they're really valuable, like the one I'm going to read today. So join the small Business Owners of America Facebook Group in brackets. You'll see business bootcamps. So you just recognize it's me and you'll see a picture of me on there. There's only like 60 or 70 people in there, which makes it a really nice, tight.

Really, really good content. So check that out. That's where this question is coming from and it's from Tyler Van Salvig and I hope I pronounced that all right. But let's go ahead and read this question. It's a little bit long but it's super good and I wanted to cover it today. Tyler asks I got a question I've been thinking about most of the time as a business owner, entrepreneur or just human being. We focus on staying in business or just plain winning but don't talk much or I haven't researched enough about when the business is not doing great and have to start thinking about exiting the market.

I guess the question would be what markers would need to be apparent to start taking steps to exit the market? What would we need to be focused or aware of to be self aware that the business is not doing good and makes more sense to close than go further into debt? As business owners we want to push through, grind, produce a better outcome and get through. But I believe at some point it may not work out and so just thinking of ways to think ahead of if and when that time comes as to make the right decision. This is a pretty loaded question. I'm not sure if all questions are relevant. Just know the topic is relevant and wanting to be aware and getting thoughts on this. I'm thinking this is a difficult question to gauge as well, especially if you have quite a few employees that rely on the business for money and work. Bonus question if you're needing to exit a market, maybe some helpful tips to be looking ahead for entering another market. Any past experience input is welcome here too. Thanks. So that's from Tyler Van Salvig. So thank you Tyler for writing in your question. I'm going to go through this question. I don't have any notes but I'm pretty fired up about this topic so I figured I could just go into this podcast and share my thoughts. Kind of raw. So.

First thing that actually jumps out to me is the last thing that was mentioned. So Tyler was asking like what are some of the. What are some of the helpful tips to be looking ahead for entering another market? Now Tyler, throughout this question you talk about exiting a market, looking to go into another market. I'm going to assume you mean another business. I'M gonna assume that you're not mean just like moving, like, in terms of like moving demographically to a different geographical location. I'm going to assume when you say that you're moving out of the market that you are closing down the business. And I'm going to assume that when you say you're looking, you want helpful tips to be looking ahead for entering another market, I'm going to assume you're talking about entering another business. Okay? So that raises big flags, red flags for me. And the reason that I have I come to this conclusion is that when someone is on a sinking ship and they've been running their business poorly or it's been going down.

A lot of times we get this notion that joining a different business, starting another company, getting involved in a different industry is going to somehow fix all of our problems. And.

The reason I say that I've found this the past few years because as I've done business boot camp podcasts especially, the reason I keep doing like business bootcamp podcast is not my industry. Right. My industry is lawn care landscaping. The reason I continue to do business bootcamp, the reason I continue to do Small business Owners of America on Facebook groups is because I have found that the laws of business, the rules of business are universal. There are very basic principles of finance, accounting, marketing, leadership. Those principles are literally universal. Doesn't matter what industry, doesn't matter which country, does not matter which type of size of business. There are certain principles in business that are universal. And the reason I can say that is because I've seen so many industries from business boot camp podcasts, and that's why I continue to do it, is because it gives me a very good grounding of different industries and realizing the patterns, the issues, the problems that I face in my industry.

The primary industry that I'm in, lawn care landscaping, that those are the same problems. Hiring and labor is a massive issue in our industry right now because the labor market's so tight. Well, guess what? It is in every market. Unemployment is super low. The economy is expanding. Even in professional jobs. Like, it's very hard to find good people, very hard to pay them what they are worth. It's very hard to keep them, retain them, hire, find all of those things in so many different industries, especially in the labor market, yes, like other contractors, things like that. But it's universal. There's universal things to do with marketing and SEO and customer acquisition cost and analysis of certain financial key metrics that are completely universal. And so when I find someone that says, okay, I'm failing at this business and I'm gonna jump to another business because it's a better industry or it is doing technologically, it's on the upswing or everyone's going towards it, or crypto's the next thing, or real estate is definitely a passive way of making money, whatever the thing they're jumping to. So oftentimes I find that they neglect to realize that the same problems, mistakes, failures, issues that they're having in their business causes, guess what? They come along with you because the universal laws of business do not change across industries. They do not change against you moving to a different town. It does not matter the size of the business. There are certain laws of business that are in place and if you go against them, you're going to fail. Regardless of what business you're in, regardless of how many people work under you, regardless of how much money you take home, there are certain laws of business that stand universal. And so when someone, anyone is on a sinking ship, they run their business into the ground, whatever, it's not doing well, it's going down, they're in debt, all these things.

I have a lot of warning signs that go off when they think that they can just jump to another business and it's going to be better. Tyler, I'm not saying that's necessarily your case. I don't know enough about your situation to know if that's really what's happened here. But, but I just find it hilarious how people have like two, three failed businesses and they think that just getting into a different industry is going to change everything for them. That being said, this goes back to what Tyler says about the general entrepreneurial way of thinking is like, keep trying, fail fast, just keep, it doesn't matter if you fall down, get back up. And that's all true and good, but eventually you have to be self aware enough to realize, okay, look, I like running a business, but maybe I'm not the CEO, maybe I'm not the founder, maybe I'm a chief operating officer, maybe I'm a chief marketing officer, maybe I'm really good at sales and I need to be ahead of a sales department, but I do not need to be the founder because maybe you're flawed in some area of entrepreneurship of some.

Universal law of business that you're failing in and therefore you fail at this business, then you go do another and it fails, and then you go to another and it fails. And you're constantly trying to chase the next shiny thing, you're trying to chase the next Cryptocurrency, you're trying to chase the next bitcoin and the next real estate gig and then this and then the pyramid scheme and that happens and all trying to chase the next thing. Maybe it's not crypto and things like that that seem a little fishy or pyramid schemes. Maybe it's literally just roofing and then, oh, it's cleaning and then it's, oh my goodness, haven't you seen the healthcare industry? Oh my goodness, we're gonna get into selling healthcare equipment and oh my goodness, people are getting old. So we bet we should start a nursing home. If you're just jumping from industry to industry and you're continually failing, you eventually have to be self aware enough to realize possibly, possibly that you're not cut out for entrepreneurship. And that's not to say you're less of a person or less of a business person, because there are plenty of great coos and number twos, number threes, number tens that realize that they're not a number one, they're not going to be the founder, they're not going to be the owner, but they are wildly successful when they realize and are self aware enough to know that they're not number one. But they could be really good support to number one, or they can be a really good part of an executive team. And so my first alert or thing that kind of dings off in my head when someone says, should I jump to another industry because I'm not doing very well is I have to ask, are you self aware enough to pick up on the fact that maybe I'm not cut out for this, or maybe I have certain flaws or weaknesses that can be covered if I'm with another team or if I have a partner in on the deal that's going to cover those weaknesses. So just something that I was thinking about, but Tyler's kind of general thought is like, okay.

What? So I'll read it. I guess the question would be what markers would need to be apparent to start taking steps to exit the market. Okay, so this is me, this is my opinion, and this is the way I would do things if I was in this scenario. I've never had to take a macro business loss. And I'm not saying that to toot my horn. I'm saying that to say I don't have a lot of years of experience, I don't have.

Decades of experience where I've lived through many recessions and had to witness or be a part of bankruptcy or a business failure. I've never Had a macro business failure. Always little things that didn't work. I remember starting.

My personal most devastating business loss was when I started.

A skiing and snowboarding waxing company. Posted an ad in the newspaper. This is, like, when I was eight, seven, something like that. No, I would have been nine. Nine or something like that. Anyways, I thought it was gonna be, like, the next biggest thing ever, right? Like, when I was younger, I would sell food to the golfers. I would. You know, we delivered phone books, newspapers. We did all that before even getting into mowing lawns when I was 11. So when I started this snowboarding, like, you know, you take the iron and you iron the snowboard, and you scrape all the wax off and, you know, you sharpen the edges. And, like, I thought this was gonna be big, right? I'm like, okay, I'll run in the numbers. Like, okay, if there's 20,000 people in Whatcom county, that all snowboard And I get 1% of the market, that's 200 people. And if they all give me $50, right? So, like, I was running that kind of math, right? I was like, oh, my God, it's gonna make millions of dollars. Well, that was my. Probably my biggest failure for business. Like, but there's been all sorts of little things, right? And so, you know, we started Augusta Cleaning Services several years ago. It got a little bit traction, but at the end of the day, I was like, look, there's not enough margin. I'm not gonna be able to scale this as big. There's no differentiation between us. It's very difficult to find labor for that cheap because I can't pay them enough. Whereas with landscaping and things, I can have bigger equipment, I can have bigger trucks. It's more scalable. I can pay people more. So therefore, I can find better people. So, really interesting. So Augusta Cleaning Services. I've probably wasted not very much money at all, maybe 10, $15,000 trying to do that. So it was like a macro failure, right? Like, I've never had one of those. So I can't speak from experience on those things. And I don't know exactly what I would do if I was in a scenario where literally I was gonna have to go into bankruptcy or I was in debt on a business. I don't. The full disclosure as I go into this question is I've never been there. I've never been there. And so I can't speak from personal experience, but I have talked to a lot of other business owners that are in the same sp. Tyler asked what Markers would need to be apparent to start taking steps to exit the market. I said all that framework background on me is to say this. Me personally, if I was in this sort of scenario, my type of personality is not to take steps towards anything. My personality is jump towards whatever I need to do. So if I think I need to exit the market, and that is even a thought in my mind, it's gonna be done, like, done tomorrow, done yesterday. Right. Like, I'm not gonna be like, okay, what's the steps to doing that? Like, what are the indicators? Like, if I think for one minute that I'm too far gone and like, okay, I'm going to close this thing, guess what? It's gonna close tomorrow. Like, I'm not gonna take steps towards rolling it down. Like, it would just close immediately. Because if I'm going to fail, if I'm going to fail, I wanna make it as fast as possible. And I'm not. I'm not talking about starting a business so that you can fail and learn. I'm not into that stuff. We're finding out with WeWork and Uber and these other Silicon Valley companies that that sort of thing does not fly. Like, fail fast. Like, starting a business just to fail is ludicrous. But if you're going to fail, if you're going to go out of business and you know that's gonna happen, just do it fast. Like, don't draw it out for 10 years. Don't try to, like, you know, you know, obviously exhaust every resource to try to improve the business and turn it around. Like, yes, you should Absolutely. Try to have. Create systems. Absolutely. Try to hire better people. Absolutely. Cut cost. Absolutely. Make more efficient. Absolutely. Focus on sales and try to grow your way out of the. Like, so many ways you can try to fix it, but let's assume all of that you've done and you just know that this is a lost cause. Maybe you realize you're not a founder and this is the wrong thing for you. Like, you need to go get a job. If I was in that scenario, I would try to make the business like, I would try to make it as fast as possible. Tear the band aid off. Don't do it step by step. Don't do it little by little. Don't try to ease out of it, just do it fast. If you go to declare bankruptcy, go out, do it. You fell down, you made a big mistake, you made a foolish error in business, whatever, get back up and keep going. Don't let it drag on. Don't go into bankruptcy. And then like take a year off and then complain and whine or feel bad for yourself. Like, take the loss, take the L and move on. There's plenty of sports dynasties that have had an entire year where they just absolutely miserably fail. The ones that become great and go on to win championships are the ones that, okay, that's just one year. That's one L. That's one game. Like, there's incredible teams that will all of a sudden they've been winning, winning, winning, and then they lose. Like the worst team. Like, it's not the time to be like, oh my goodness, we fit. We're such idiots. We're so such failures. Like everything's lost. No, like, it's an L, it's one L. You keep going. It's a long season. If you're in the MLB, you're like 160 games. If you're in the NFL, like, if you lose a game on week eight, guess what, it's one out of 16 games. You can still make the playoffs being 15 and one, for crying out loud. Like, you gotta be able to take an L, get back up and face the next game and get a wow. And so I highly recommend if you are on that trajectory of you knowing you're going to go out of business, you know this is not the right place for you, that you're not cut out for entrepreneurship, which is not a slam in any way. It's just you being self aware of what you're capable of and that maybe your strength isn't in this category of business, in this category of business, of entrepreneurship, you have to be able to be very keenly aware of so many different facets when you might just be strong at one of them. And you'd be much, a much more productive executive, a much better leader if you could just focus on that one thing. Maybe it's sales, maybe you're really good at accounting, maybe you're really good at marketing. Maybe you're not the generalist of an entrepreneur that needs to do all of those things. So if I was on that trajectory and I realized that and I said, okay, I'm in a business, it's failing. I'm not good at what needs to be done here. I need to go get another job. Because I will be able to succeed in that role. I would cut ties with that business as fast as possible and I would go get a job. Actually, what I would do, if you have a family, I would go find the job, get the job offer, and then cut strings with my business immediately. If I gotta declare bankruptcy, if I have to take a massive loss, if I have to go, if I'm way into debt, just tear the band aid off and move on. If you're aware, self aware enough to know that this is not for you, if that thought even crosses your mind, it might be a good time to start thinking about moving on to something else. And that might be a job. That might be. And a job might just be a stepping stone for you to get the.

Learning that you need, the experience that you need, the resources that you need to then come back to the business world as an entrepreneur founder and be have those skills filled in the spots that you had weaknesses in before. Maybe you're really just not good at sales. And so maybe you need to go out, get a job, be around a sales department, work your way through that system and then come back to the marketplace as an entrepreneur 10, 15 years down the road and being really, really strong in the area that you were weak. And that led to your business going out of business in years past. So in terms of looking for steps to exit, what would be some of the markers? Like I would just do it as fast as possible. If you know it's coming, what would we need to be focused or aware of, to be self aware that the business is not doing good and makes more sense to close than go further into debt. So this is like a tough one because it's gonna depend on your risk tolerance, it's going to depend on.

Your industry, your growth pattern, what are your financials over the past five years, Are you still growing? Are you going down and you're losing revenue?

So that's a tough one to just answer. Every single situation would be different because if I looked at WeWork right now, which by the way is having an absolute catastrophe of was going to have an IPO. Cancel the IPO. Their valuation went from $47 billion down to $8 billion within a matter of weeks. Their CEO has left and was paid a massive $1.7 billion golden parachute. And which made the employees absolutely furious, which rightfully so because he had all sorts of issues. And anyways, We Work is this big example. I'm looking around. I highly recommend you look at them. I might do a podcast on We Work, but what are the mark like? The thing about WeWork is that they literally were losing $1.6 billion.

Last year on I think it was like 3.2 or 3.6, don't quote me billion dollars in revenue. So they literally were having $3.6 billion in revenue, losing $1.2 billion. Like, losing that much money. So it's hard to be like, oh, well, if you're losing money, then you should quit. Like, there's definitely value in wheat work, right? Obviously, it's still worth $8 billion, but.

So the reason it's hard to say, what are the markers to when you should consider going out of business? Just saying based upon numbers is tough because if you're just losing money, that doesn't necessarily mean you should stop. But again, risk tolerance is huge. If your family is being torn apart because the amount of risk that you're taking on as the business owner and you're plowing all of your time and all of your money and all of your resources, and you downsize the house and then you sell the vehicles, and then you take money out of all of your retirement and you take money of all of your college kids, college funds, and now they're stressed out, and now you're breaking relationships, and now you don't have any time for them. Like.

That'S a signal for me, right? Like, when your priorities start getting messed up. For me, that would be a marker for when I need to close a business.

That's just a very personal way of looking at it. But the thing is, you say, well, what about the numbers? What about the money? The thing is, if the money's messed up and your risk profile is out of whack with your personality and the business is not doing well to the point that you need to close it, what's going to start happening is because of the stress financially, then you're gonna be stressed physically and then emotionally, and then that's gonna break down and it starts to eventually affect your family and your relationships and all those things. And if those things are more important to you, that's when I would be. This is personally, that would be the marker for me. Like, okay, this is not just sinking the business now. It's sinking, like, my relationships, my family, like, my lively, like, just, like, living. It's affecting my life. And yes, that will absolutely boil over into your employees and then affecting their families. And you talked about, like, okay, it's affecting your employees because they depend and rely on the business for work and money. Yes, it's going to affect them if you close the business. It's also going to affect them if you're not being able to be the fool. You. Because you're so stressed out about the money, you're so stressed about now because your wife or your husband is at odds with you and your kids hate you and they never see you, and you want to be there and to support them, but you can't be, because if you don't, then the business is going to fail. When that all starts happening, guess what? You aren't being supportive to your employees anyways. I don't care how much money you give them, you can't give them any more money. You can't afford it because the business is doing bad. You can't be a full boss and have great culture and support them emotionally and in their profession and try to help them to their success. Because you and yourself are pulled in 100 different directions. Your brain, you're stressed out, you're way beyond your risk profile.

You're emotionally torn apart because your family's going one direction. When that starts happening, in my mind, that's time to throw in the towel. Because if you don't throw in the towel in the business.

Other people are going to throw the towel in on you. And that can be much more emotionally draining and scarring for a business owner than losing a business. Like, guess what, if you go into bankruptcy, you basically, you can forget about it in 10 years, right? Like 10 years later, you can still run another business, be really successful. You know, maybe the economic ties have changed, maybe you're in a new industry. Whatever, you'll get through it. Closing a business, you'll get through it. What is a lot more emotionally damaging and much more has much longer implications is ruining your relationship with your children, ruining relationship with your spouse, ruining relationships with your employees that you might have grown up with. Like, those are the things that will stay with you for the rest of your life. A bankruptcy, a micro failure in your business, you having to close a business and go get a job for five or 10 years, that will not scar you the same way as taking the more important things of your life and sacrificing them to try to keep a business that's going down, trying to keep it elevated for just a couple more years. So for me, the markers of me needing to close my business when it's failing is when the failure of that business starts to cause failure in my other relationships that are more important than the business.

And for some people, that's not the way they would measure it. They would simply measure it based upon money, right? But it's very hard for me to say that because I would say that at some point, there's some point in some business, I would look at the projections, I would look at, okay, if your gross revenues are Falling and you are losing more and more money every single year and you feel like you've tried everything. And then maybe like if I could see those numbers, I could make that decision, I'd make that call based upon the numbers. But without seeing the numbers and knowing that there's businesses that are creating value for shareholders that are losing money, like Tesla, they lost tons of money. They finally made turned a profit this quarter. Amazon lost lots of money when they were going having their IPO and everything. But they ended up making a very valuable business. Like should Bezos have closed Amazon because they were losing money? No, they ended up making hundreds of billions of dollars, trillion dollar company. So like to just based on the numbers is very difficult without seeing those numbers and knowing the subtext of your question. But for me personally, without seeing numbers, a lot of times I know that someone is like for instance, Bezos wasn't concerned because he knew that the growth of Amazon and where technology was going and what they were doing for customers far exceeded the negative numbers that they were seeing on the bottom line. Right. And he knew that the, the interest of investors was going to supersede the need for cash. So he gets the at night, right? If you can't sleep at night because you know that you are not inclined, your sales are declining and your profits are declining and your take home profit is declining and yet your costs are increasing and your turnover is increasing. Like if you're losing sleep over that, then maybe it's time for you to close the business.

And I talk a lot about grind and hustle and push through and so I am an advocate and slightly guilty of the notion that Tyler is referencing of us as entrepreneurs. Like just go, go, go, get through it. Guess what? There's a time of being self aware enough to know you need to quit. It's not easy. Takes a big pride hit for most people, that's the reason they keep going. Honestly, they're too proud to quit. They're too proud to take the L. Like guess what, the best athletes in history, they lost a game. And guess what, there was times in a game where they knew they were going to lose halfway through they didn't throw in the towel for the rest of the season. They just realized, okay, I'm going to take an L, I'm going to move on. Like next week's another game, tomorrow night, it's another game, another opportunity to shine. And they got to put that failure behind them. And so I'm a big advocate of micro losses. You know, fail fast in the micro don't put your business out of business, but constantly be trying to innovate and realize that if you're gonna fail, like, learn from it fast and then move on. Just keep going, like iteration, iteration. Like minimal viable product. Figure things out. Always trying to innovate. Innovate and like realize that flow. Four out of five things are gonna fail, but that fifth thing is gonna be the thing that accounts for all the losses and doubles the business, right? And so I'm a big advocate of micro losses. Like figure things out, innovate, test, experiment, try test, fail. 4 out of 5 things aren't gonna do well. That one thing makes all the difference, covers all the losses, plus doubles the business. Happens every time. Don't be complacent. Don't just play it safe all the time. I'm okay with micro losses. I just will not risk my business. I will not risk the livelihood of my employees. I will not risk the future of the company. And so I will never bet too much. I will never go into debt so much that I know the company can't get out of it or that I think it puts everyone at jeopardy. I just won't do it. I won't make risks financially that are going to risk the livelihoods of myself, my employees, the business, the brand, nothing. Like now we have franchisees. I feel responsible for them. I'm never going to make financial decisions that actually put all of that on the table. I'll never put all the chips in. I'm always going to be playing like I want to end. Did that work, that test? Okay, that worked. Bam. Hit it. Go five, right. That fifth one out of the, you know, four fails. Micro, micro, micro, micro, macro win accounts for all those four losses and more. And so I hope that kind of answered your question, Tyler. It's absolutely something we need to be talking about more and that is failure. And, and that it's not a bad thing. Take the l. Bankruptcy lasts 5, 7, 10 years. Take the L and move on.

So without knowing all of your information, Tyler, without knowing the numbers.

I'd say, like the fact that you even asked the question, I would probably say that it's probably time that maybe you're self aware enough to realize that you have certain holes, there's certain universal laws of business that you might not be strong in and you can go get those, you can go get, you can acquire those skills and it's extremely mature, Extremely mature entrepreneurs realize where they're weak and they can go get those skills, come back stronger. So you've been listening to Business Boot Camp podcast. I'm Mike Andes. Until next time. Be great, because nothing else pays.