Have a game plan for staying in the game

Had a conversation today where we discussed someone's game plan for staying in the game of being an entrepreneur. It is very easy to either get discouraged and quit, or be so optimistic that you run into real financial trouble.

The key is to get serious about knowing what your monthly nut is to keep your lights on. This can be on a personal level and as a business. If you are a one person startup it is close to the same thing.

There are payments that you can't get out of short range, like rent / mortgage, food on the table, lights, etc. You should know this number like the back of your hand. Then make sure that you realize that everything else is a choice.

So many times the extra choices are put on auto pilot which uses up precious runway. If you reach the end of the runway before liftoff, it is not a pretty sight. The decisions you make here determine how long you have to try.

The other side of the decision is your personal limits. How far do you go into debt before failure becomes catastrophic. One of the lessons I picked up from Richard Branson (Virgin Airlines) is that he structures every new venture in a way that failure doesn't impact his other businesses.

Keeping the cost of failure tolerable is a huge factor. Otherwise you will severely limit the number of times you get to try.

At the end of the conversation, we discussed how it comes down to personal sacrifice of the extras and having an intelligent warning system (budget) that let's you know when it is time to fold your hand and try again a different day.