Inside the Office
Editor’s Note: Last week, Jamie wrote about quitting your job and going “all in” on your startup. In case you missed it, we’re sharing a link here since, this week, Shep takes a look at the other side of quitting… knowing when to quit your startup and move onto something else.
I had a recently graduated MBA student reach out to me with a tricky question about his startup. And this wasn’t a student with a half-formed idea or a weekend project. This was a smart, talented, experienced professional who’d spent nearly two years building a real company that had four founders working remotely around the globe. As a result, alongside the standard firehose of investor conversations, product decisions, and team tensions, they constantly found themselves in late-night Zoom meetings and early-morning customer calls.
By this point, they’ve done many of the things we tell entrepreneurs to do. They have a product, they’ve sold it to customers, and they’ve listened to the market well enough that they’ve been able to successfully learn, pitched, refine, and keep going.
And now, after investing lots of time, money, emotion, and personal identity into their company, the question they wanted help with was painfully simple.
“How do we know when to quit?”
I paused on the founder’s phrasing. It wasn’t, “How do we know whether the business still has a path?” or “How do we evaluate the evidence?” or “How do we decide what’s next?”
It was: “How do we know when to quit?”
The emotion is what makes these decisions so hard for founders. They’re not just analytical. They’re personal. Deciding when to quit is wrapped in ego, identity, loyalty, sunk cost, and fear. Quitting sounds like failure. Quitting sounds like weakness. Quitting sounds like letting down your co-founders, your investors, your customers, your family, and maybe most painfully, the younger version of yourself who believed this thing was going to work.
I began my response the way I often do when I get asked this particular question. I told him, “The fact that you’re asking the question is clue number one.”
To be clear, that doesn’t mean the answer is automatically to stop. But it does mean something inside you is trying to get your attention. Entrepreneurs are famously good at ignoring reality when persistence is required. I’d even go so far as to say it’s part of their talent. But it can also become a trap. After all, there’s a difference between resilience and denial… grit and ego… believing in a vision and refusing to read the scoreboard.
So we went to the facts.
If I walked in as a board member or investor, what would the numbers tell me? What evidence do we have that this should continue? What do we have to believe to be true for this to become the company we imagined? What is the actual probability of reaching our short-term and long-term goals? Not the hoped-for probability or the founder-pitch probability. The honest one.
In this case, the world had changed. AI tools were emerging that fundamentally altered the competitive landscape, the customer need, and the urgency of the problem. At the same time, some important things hadn’t changed. The sales cycle was still long. Customer decision-making was still slow.
Then I asked a more personal question: “How does this venture serve your goals now?”
That’s a question we don’t ask enough. This student (and his cofounders) had already gained enormous value from the experience. He’d already learned strategy, fundraising, selling, pitching, customer discovery, team leadership, product development, and the reality of building a scalable enterprise. In other words, he’d certainly become a different kind of professional because of the attempt.
So the question became: What do you still have left to learn? Are you energized by the next mountain? Do you wake up excited for the next two years of this specific fight? Or are you staying because stopping feels embarrassing? Don’t confuse unpleasant decisions with hard decisions. Hard decisions require the analysis and the insights required for understanding. Unpleasant decisions are ones where we know the answer — we just don’t want to face the emotional consequences.
All businesses have a lifecycle. Some are short. Some are long. Some need a pivot. Some need more capital. Some need a different team. And some need an honest ending.
I know this personally. I made the painful decision to close my 97-year-old family business. I wasn’t because there wasn’t market or we were losing money or because we couldn’t have sold it. I closed it because I knew, if I was honest with myself, I didn’t have the fire in the belly to commit the next ten years of my life to making it work. I had already invested 32 years as an owner, CEO and Chairman. I had all the financial rewards and ego i could have ever imagined.
Was it difficult to make that decision? Absolutely. Was it the ending I imagined? No. But it was the right decision for me and for my family.
That’s the lesson I wanted this student to hear. You’re not quitting; you’re choosing. You’re not failing; you’ve gotten clarity. You’re not letting people down; you’re deciding what chapter of your book you want to write next.
Businesses come and go. Markets make sure of that. Products come and go, too. And people move on. And strangely, the world keeps spinning. What remains are the relationships, the scars, the lessons, the courage, and the person you became because you tried.
Because of that, entrepreneurship isn’t just about knowing when to persist. It’s about knowing the difference between persistence and denial. It’s about being brave enough to face the facts, and even braver to face yourself.
Sometimes the most entrepreneurial act is not starting the company. Sometimes it’s knowing when to let it go, take the learning, and go find the next mountain to climb.
-Shep
Worth Your Time
This week the White House released “Science: A New Golden Age,” a report that outlines a perspective (and series of recommendations) on the U.S.’s science investment priorities.
I’m not sharing the report because I’m expressing a policy opinion; I’m sharing it because this document is a map of where the money, talent, and infrastructure behind American innovation may be headed next. As an entrepreneur and innovator, you likely live downstream of these decisions.
The best founders I know are always looking for where the puck (and money) is moving. This report is a roadmap of exactly that.
That is what it came down to it for me in June. Where was this article when I needed it?? 😝
Really like the distinction between difficult and unpleasant decisions. I hadn’t gotten to that distinction until you said it.
I find both books, Thinking in Bets and How to Decide, both by Annie Duke, to be excellent guidance for both difficult and unpleasant decisions. It takes some of the emotion away.
Sometimes You Win, Sometimes You Learn (John Maxwell) and Ego is the Enemy (Ryan Halliday) was essential re-reading for me after deciding.