Allright, so no matter if you run a business, or a product, it does not matter actually. I mean, I am usually looking at it from an IT point of view, and usually an online point of view part of that. But no matter, your professionalism should make you take an objective look at the success or potential success of your product. So, be honest to yourself, and take a hit if you see your product or business fails.
These days I am dealing with the owner of a hopeless online production. And with that, I really mean hopeless. There is simply not a option that there can be any money made of this production. The idea is broken, the concept had a flat tire from the beginning. Still, the owner was so sure of the success of this concept, that he did not take any time to really do any kind of research and started putting an investors money in this money pit. It is sad actually, because at this moment I see him daily struggling with the situation. But still, he does not want to accept that there is no future in this production, and he does not want to lose faith.
2 Centuries ago, there was a way of handling defeat ‘like a man’ from someone else, which was simple. You could challenge them for a duel. But these days, well, you don’t shoot your oponent. And by the way, your oponent is the market. To be honest, when you get into this downward spiral, get real. Take your pride, cut your losses and walk away.
Ten years ago I started my ‘first’ company with my best friend. We made I think 1001 rookie mistakes. Too bad, because I still think that what we actually did was excellent. But we simply lacked knowlege of the world outside. If you cannot make money of a product, you will not get money. Simple. Not getting money is a severe problem if your survival plan is based on making money.
Back then, after three months of working we saw that although money was promised, it was not coming in. It was simple, we had the work, and no money. 1+1=2. We decided indeed to cut our losses. Not to go bankrupt, we didn’t want to get into that. Just, take our experiences, learn about the value of borrowed money and make a pay-off plan with our creditors. We simply cut the costs in half, and we both carrier our responsibility for our share. On the other hand, because of this, we actually recieved, for that money, quite some valuable information in a learning process; When to recognize that your are heading down the drain, not something you learn in your basic business school. Because, there are in the case of such a failing scenario two options; sell, or just sink the ship. With selling you actually might get a buck, but if you hold on to it for too long, you might actually end up in deeper problems. If you sink the ship, all the money is gone. We chose the second option, because although the money was gone, we knew were we stood, and it allowed us immediately to go on.
Actually, I now see that the most important factor is to be true to yourself when you write a business plan. It is not there to prove you are going to make loads of money. It is there for you to make sure if you are going to earn money with your plan, and what you have to do to get to it.
I have seen the business plan from this person who has this failing production right now. The worst case scenario was that he would sell to 2,000 clients instead of 20,000. There was the problem immediately, because the worst-case scenario would be selling to 0 clients (which actually is the case now). Or worse, selling to 1 who is unhappy and want his money back. Not only do you have no money then, but also a bad name.
I write this actually quite formal, but believe me, it is so frustrating dealing with someone who just does pull every trick out of the hat to get people invest in nothing, just because he does not want to hear his project has failed. Now, because of that, he is not only hurting his project and reputation, but also his personal life too, and his carreer. Is it really worth so much to follow your dreams? When I was a kid, one of the first things I had learned about the financial world is that you cannot buy things you do not have the money for. Well, we all know that you can, but hey, that is what got us all in this nice financial crisis. It is called taking responsibility. Sure, it is hard, it is tough… but in the end, it is also worth it.
Because sometimes dreams are better to be dreams. My wife would kill me if I would follow some of mine 😉