A founder explains why $10 million in revenue means nothing if you're not profitable at $3 million. He tracks cash, not accounting profit, pays himself first, and sets expense ratios tight enough to survive slow months. Growth doesn't fix broken margins.
Revenue's up 30% this year. We're growing. Revenue's flat this year, but I kept an extra $400K, so I'm good. I reinvest everything back into the business. That's how you scale. I reinvest what's left after I pay myself first. That's how you last. We need one more big month to get back on track. I set expense ratios so we survive the bad months and celebrate the big months. My accountant says we're profitable, so we're good. I'm more interested in what my bank account says than what my accountant says. The profit that matters is the profit that you can distribute. Once you hit $10 mil, the margins will just sort themselves out. If it's not profitable at $3 million, it's not gonna be profitable at $10 million. Growth doesn't fix margins, it shrinks them.
