How To Know When It’s Time To Walk Away?
Ah, the BIG question that no one likes to answer: when is it time to walk away? To many, this question is the ultimate slap in the face. As has happened to countless entrepreneurs — you are approached by any number of friends, acquaintances, distant family members, etc., (who may know very little about starting a business) with the frustration-inducing question — “So, when do you think it’s time to move on?” This question is irritating on a number of levels, most notably because 99.9% of the general population assumes, based on popular culture, media, etc. that every single day, startup companies are acquired for billions of dollars, and their founders thrust into instant fame and glory. Therefore, if you are toiling on a business for more than 12 months, without achieving millionaire-status, certainly you are destined to fail and therefore should resort to another line of work, and permanently extinguish any memories of that ill-thought endeavor.
Of course, my natural inclination here is to write some retort about disproving the obnoxious doubters and skeptics, whom are largely the ones asking this question, but I digress, as that is another post in itself.
Back to the question at hand. Seriously, how do you know when it’s time to walk away? As I have tirelessly admitted — I have done a deplorable job at keeping up this blog. But, fast-forward from my last post, and I myself had been faced with this same question. Thinking through the potential decision to walk away from the business, I continually came back to the same consistent answers. Being that I am a big believer in “going with your gut” I took stock in those thoughts, and ultimately made the decision to stepdown from the startup I had co-founded. It’s never an easy decision, and there is not a one-size fits all solution. Each and every entrepreneur and business owner needs to think critically and objectively about their individual situation and logically arrive at the best decision to move forward.
In my opinion, however, there are a few essential areas that will provide clarity to a “leave or stay” decision. I have found some of the best solutions are to be a devil’s advocate with yourself… and truthfully, doing just that can promote some seriously sound decisions. How to know when it’s time to walk away is one of the most (if not the most) under-rated, but incredibly important questions to ask. Here are the top five questions I’ve asked myself before deciding to walk away:
- Why are you asking the question to begin with? This is not meant to be a satirical question. Think about it — if things were going well, you wouldn’t be thinking of walking away, right? Or, would you? Are you thinking of quitting because the product isn’t working? Because your sales aren’t growing? Customers aren’t buying? Investors aren’t making offers? You’re running out of cash? You’re unmotivated? Find the reason — it is a huge first step.
- Are you meeting your milestones? Another tremendously under-rated question. Seriously though, I’m amazed at how common this problem (of not attaining goals) is. Any intelligent investor is going to ask, and if you aren’t reaching your goals; be it customer acquisition, partner retention, or good old-fashioned sales, you need to figure out why you’re not hitting them. Or, in the even worse scenario, you don’t even have any goals, milestones — which is an even larger red flag. Assuming you do, why aren’t you hitting them? Answering this specific question should be a separate post, but if you’re missing your targets repeatedly, that could be a sign that you need to exit (notice I said “could” be).
- How are your business partner relationships? If you have a business partner, what is the relationship like? More specifically, are you able to work together? Do you agree on long-term goals for the company? Short-term implementation strategy? Do you get along in a business context? Partner tensions are one of the largest causes for startup failure and/or split-up. Assessing the day-in-day-out working relationship with your business partner is a necessity. Long run — what implications could be made about the business’ success if things stayed the way they are. As a company grows, so do the problems. Correcting issues now (or choosing to walk away) could save a tremendous headache later on.
- If the business blew up, and you had quit, would you be okay with that? If some of the above questions are under-rated, this one would have to be one of the most over-rated question asked. Regardless, it aided in my decision, only because I was asked countless times. I get it, everyone wants to know — if your company worth skyrocketed to the hundreds of millions, and you weren’t a part of it, would you hate yourself? The reason I say this question is over-rated is that it’s somewhat ridiculous. If you would make millions next year but instead, didn’t, would you be disappointed? I would think the answer is an obvious, yes. There would be disappointment certainly. But, it’s just not that simple. If the business were on the verge of blowing up, most likely, you wouldn’t be contemplating quitting. And, if you were still thinking of quitting, that would imply that there were serious concerns outside of your future financial well-being. Point is, what got you to this decision point is probably one of the above issues. The reason people hang on to this question so much is that they obsess over the “what if’s”. IF the hugely improbable happened, then… This is just not logical thinking. The bigger picture is that, in this scenario, your only motivation is financial and you are treating your business purely as a lottery ticket, but with a lot more required from you.
- DO YOU STILL CARE? Is the fire there? Yes, I realize this sounds like a witty rhyme, but it makes sense. Do you get up excited to work on your business? Do you still enjoy what you’re working on? Do the reasons that you started the company still stand? Has the company become what you thought it would? This last question will usually be the final straw. Missing milestones, partner disagreements, lack of growing revenue, and customer issues, may begin piling up, but will ultimately result in you losing interest and even motivation. The fire is gone, as is your desire for the business to succeed. It never starts with this, but it often ends that way.
In the end, each founder needs to make a decision that is right for them. These are five of the self-reflective questions and reasons that I chose to walk away, but just because one individual leaves their startup, doesn’t mean that you should too. Sometimes hanging in there, and finding answers or solutions to the above questions is exactly what you need to do, and will be the spark plug to incite change in your company. Other times, patterns emerge and regardless of what changes you try to make, time keeps slipping away without results. Analyze the reasons, as I suggested above, and make the decision. Lingering on the pain points for months (or years) on end, often does not make the decision easier.
Lastly, and on a positive note, just because you have moved on (or even massively failed) on your first attempt, does not mean your next endeavor won’t succeed. And that is horrible advice, if anyone tells you otherwise. And, in the same breath, past success doesn’t guarantee future performance either. If you walk away from your startup, as I have, pick yourself up, move on to your next project with enthusiasm, and most of all, take with you, the lessons you’ve learned from the last one.