New Venture Lab: Equipping Christian Entrepreneurs

When Do I Pull the Plug?

Question

I am at a point where I am starting to think about shutting down my startup operation and wonder if you can share your wisdom on discerning when to persevere vs. when to pull the plug on a startup. If you touched on this in the  lectures, can you point me there? (I couldn’t find anything). Thanks!

Answer

My advice would vary based upon what the issue is:
  • Is it a Revenue problem where you cannot seem to get, keep, or grow customers as planned?
  • Is it an Operations problem where you cannot seem to produce the offering as planned?
  • Is it a Cost problem where no matter what volume of production and sales, your Gross Margin or Profitability is negative or too low to be viable?
  • Is it a Scale problem where every above works well, but the scale of the business is just too small to provide the Income you need and cannot be grown to the necessary scale?

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