Happy New Year. I was reviewing my 2025 engagements, and realized that something new has happened regularly since 2022: I’ve had at least one client a year finish a strategic review of growth options and decide to close their business. 

How do you know when to keep going, and when to let a business go?

And if this is where you’re at right now, the first thing I want you to do is take a deep breath. Similar to other questions we’ve answered together recently, this topic needs a facts vs. feelings conversation. The good news is there are steps you can take to see what’s actually going on in your business and get back on track.

At the core of this flavor of business owner angst is some version of “the money we’ve got in the bank doesn’t match what we’re committed to pay over X amount of time.” 

When the numbers don’t line up, that doesn’t feel great. 

If you’re one of my clients, we start by revisiting the strategic plan we’ve already built together for your business. We’ll review your expenses, take a look at your pipeline, see what you have under contract, identify unpaid receivables, and negotiate payment deadlines. We might even restructure compensation. 

If you’re at a standing start, here’s the TL;DR free version: cash leaks, pipeline, offers, economic conditions. 

Cash is facts. In the immortal words of Wu-Tang: 

“Cash rules everything around me, get the money, dollar, dollar bill y’all.” 

If you’ve been blessed with a business or life that lets you put your bills on autopay, micromanaging your cash can feel like a pit in your stomach. You can feel like you’re failing…otherwise you wouldn’t be here, right? 

Here’s the thing: navigating this moment will make you a much better business owner. And you very likely have a path through in as little as 8-10 weeks.

Cash leaks come from more money going out than is coming in. In accounting terms, your payables and receivables don’t match up. You may have accepted this as a fact of life. You’re small, your customers and vendors are big, and you don’t want to make them mad. 

If you’re accepting that this is just how it is, it’s Wu-Tang time. 

Shorten that receivables window. Get the money into your bank account.

And that might mean sucking it up and paying a 3% credit card processing fee yourself. Collectively, we are way too obsessed with getting back that 3% fee for those who want to pay by credit card.  

Hear me when I say this: make it easy to pay you.

Get the money in your bank account. The 3% fee puts the funds immediately in your control. Your credit card charges 18% interest at best. Your credit line is probably 8-11%. Unsecured loans are 12-15%. You’d rather pay that amount over weeks and months than 3% right now? 

Next, take a look at what you owe to vendors and other partners, and see if you can adjust the dates of when you pay. 

Crack open a spreadsheet or Airtable. Lay out what you’re obligated to pay and what you expect to receive in cash each week for the next three months. Find the crunchy spots. See if you can shift your payment dates without incurring any penalties. Many vendors will work with you, especially if you communicate proactively. 

What we’re trying to figure out is what’s the shortfall, and how long until you get back to neutral? If you see the path, it’s easier to use your financial stopgaps like credit lines, and make reliable commitments to your partners. 

Now, let’s go back to your feelings for a moment. Are you beating yourself up for letting this happen? Do you feel like a failure for even being in this position? 

You’re not. 

Everyone ends up here eventually, even the best cash managers. I have done intensive week-to-week cash management at some point for every client I’ve ever had -- a payment didn’t come in, a client cancelled a contract, we had a sales drought. 

It’s a bit of a rite of passage when you own your own business. This is a dance we all do. Congratulations or I’m sorry, depending on how you receive that information. At some point, you’ll experience a crunchy cash event. It’s stressful, and you will get through it. 

The failure is to ignore the problem. Fixing your cash leaks will help you come back stronger, and often, faster than you think, because you will be intensively focused on the business of your business.

The path through is the not-fun stuff. Step two is another collective favorite: sales. 

Your sales pipeline shows the status of your leads and might even have assigned a value to each one. 

If you’ve played the game Exploding Kittens, looking at your pipeline is like drawing the See the Future card. Is this a temporary rough patch or are we facing a financial abyss? If you’ve just gotta get to March, you’ve got a finite problem with an end date. You just need to get there. 

You do not need to blow up your whole business -- you need to go find customers. Prioritize the best opportunities. Use that device in your hand like it’s 2003. Call and text. Be direct.

During a cash crunch, the fastest path to done deals is to talk to people who already know, like, and trust you. Existing and past customers, established leads. 

While I don’t love discounting as an ongoing incentive, it’s okay if it helps you get paid in advance. I offer a 10% discount for paying for an engagement at the start. On the flip side, if you are okay with stretching out your recurring revenue, offer a longer monthly payment term to get the deal done. 

If you’re checking your pipeline regularly, you can start to see around the corner to where cash crunches could be coming. With more time, you can invest in marketing, step up your outreach, or structure a new offer. 

If your pipeline is a little rusty, here’s a quick audit:

OK, now that you’ve addressed your cash leaks (immediate relief) and looked at your pipeline (short-term horizon), it’s time to review what you’re offering.

In scary times, we’re prone to grab the money in front of us. Even if it’s not the ideal client or the work we really want to be doing. 

We say “yes” to money we would typically say “no” to. 

It’s easy to end up back in a cycle where we are only making opportunistic sales. 

Before you know it, you’re in a situation where the right people who need you don’t know who you are and what you do. You may not even have a clear flagship offer around what it is that you really do. 

If the right people don’t know what to call you for, you’re going to continue to struggle to build your pipeline and plug your cash leaks. Marketing works when you know who you’re calling to you. Because you can’t market your way out of a problem if no one can find you.

After a cash crunch, challenge yourself to be intentional about these questions: 

I’m not going to say you’ll never take an opportunistic deal again. Of course you will. But if you don’t have clarity on your offer, you’re always going to be facing an uphill battle in your business.

The first three things are facts in your control. Now we get to facts that happen to you, like market conditions. 

A few days ago, I heard this story on Marketplace that’s been sitting in my brain.

A woman invented a baby gadget that helps with messes. She was having an incredible year. She opened a warehouse and booked regional retail tests in Walmart and Target. She ramped up production for holiday delivery. 

And then, tariffs. 

She is now at the mercy of the Supreme Court. She has delivery contracts that don’t cover the cost of tariffs. She’s running out of onshore product. And the Court delayed their decision from November to January. (Decision day has just been set as January 9.)

In the meantime, she’s stuck. Pay the 30% tariff, keep the contract, but potentially kill her business? Wait just in case the tariff goes to 0% and she can immediately bring in the goods? Or try to change terms with Walmart, which will probably kill her relationship and opportunity? 

That’s “you vs. macroeconomics” in a nutshell. You’re running your business and out the side door comes a whackadoo policy event. It’s out of your control and you don’t know how long it will last.   

Here’s how to use this lens in your own business:

One more thing (because people do this all the time): 

Don’t start by blaming things you can’t control. I’ve been hearing about how we’re in a recession since 2022. Still not in a technical recession. If you haven’t looked around the corner at your cash runway and your pipeline first, don’t assume it’s just how it is.

And sometimes the right answer is also: this business isn’t your forever business. Market conditions change fast. After the last five years, you’re not crazy for asking, “Do I want to do what it takes to survive another round of this?” 

These are totally okay conversations to have. If you run the numbers and it looks okay but your heart and mind say:

…then those feelings win. You are not indentured to your company. Maybe this business is failing, but that doesn’t mean you’re failing. It can mean the conditions don’t exist for this business to be the thing you need it to be for you. 

Or you can accept it’s not the right time to grow.

The business pays your bills for now, but it’s not the right move to expand it. You deliver for the customers you have. You cut back on marketing. You collect the cash while you work on the future thing. If it’s intentional, let it be what it is.

Toiling for years without pay and no end in sight isn’t a noble thing to do. Impoverishing yourself with the business isn’t the point. It’s okay to say, “This doesn’t meet my needs.”

I know some of you out there might think of your business like it’s your child. You birthed an idea. You poured your heart and soul and resources into it.

But your business is not a child.

I would not abandon my kiddo. I would move heaven and earth and make very hard decisions that I won’t detail for the permanent internet record.

The business is what I do to earn money, and it expresses a lot of who I am as a person, but it’s not the only business I could be in. 

Letting something go that isn’t working isn’t a failure. It’s choosing the future.

Today’s newsletter was a long read, so I’m going to keep this part quick. 

Prediction time! Speaking of the economy, here’s a quick roundup of prediction pods that I found useful. Everybody’s Business from Stacey Vanek-Smith, Planet Money predictions for 2026 including a range of bank outlooks, and Monday’s Marketplace on Venezuela and January jobs reports. 

Need some joy? Unrivaled is back. The player-founded, 3-on-3 basketball league has new teams and games almost every night through March 4.