Has the person you are taking advice from ever had to worry about making payroll?
How about having to juggle which vendor to pay when getting calls on past due invoices when there’s no money in the bank except to hopefully maybe clear payroll this week?
What about personal guarantees on lines of credit that are larger than the value of the home they live in? Have they done that?
How about making calls to key clients asking them to at least progress pay you for invoices that are over 120 days late?
Have they skipped any paychecks to themselves, so that the other team members can get paid before they themselves do?
I’ve done all of the above. It’s not fun. It actually sucks big time and is really painful. Worrying about cash flow and where the next buck will come from is not for the faint of heart and will definitely impact your sleep.
One memorable story in particular
I remember one day around 1999, with a staff of 20, when the giant payroll nut was coming due in two days, and there wasn’t enough money in the bank to cover it. Our $250K line of credit was maxed out, and we were also getting a bunch of vendor calls for past due invoices we owed. There was one company that owed us around $40K and our invoice to them was over 90 days old. I had no choice but to go pay them a visit in person. Call it the Hail Mary pass.
So I drove to the Shield Environmental office in Charlotte and sat down with the CFO. We exchanged pleasantries, and then I asked about our past due invoice. He said the following: “…I was holding the payment because there’s an issue with some of the work your company performed on the project…” and just then he opened his desk drawer, pulled out the check they owed us, and handed it to me. I nervously took the check, agreed to address his concerns, and off I went, straight to FedEx.
I immediately overnighted the check to our bank lockbox, told our controller to skip my paycheck on this run, and then proceeded to rejoice in a small win: we were still in business! Of course, I had to explain to my wife that we couldn’t pay any bills for the next two weeks….but sometimes, you gotta do what you gotta do.
Listen, yes…but make your own decisions
Dealing with this stuff is part of the journey. And people that haven’t had to deal with this sort of thing just don’t know what it’s like to sacrifice like that. It’s just not part of their vocabulary.
Of course you can learn from anyone and everyone. I surely do. Even from self-proclaimed experts that have never had to suffer from any of the above situations. After all, everyone has expertise in something that you probably don’t.
But let’s be clear: if the person you are taking advice from has never “been there”, then they do not exactly know what its like to be in your shoes, even if they say they do. Only someone that has actually gone through the fire knows what you are going through.
So listen and absorb, but make up your own decisions. Better yet, surround yourself with people that have actually gone through some of the above, that have actually taken those risks you are taking. They too have a lot to teach you, and probably more so than those that haven’t.