You Don't Need More Motivation, You Need Less Shame

I saw it in ten minutes. She had been inside it for three years.

Three months ago I took a call from Megan, a former colleague and a good friend, and inside five minutes she told me she and her husband were thinking about selling the business or shutting it down.

I had to ask her to say it again!

The people this was happening to

They both hold industrial engineering degrees. Three years ago they left corporate engineering jobs and started a recruiting and staffing firm placing engineers into highly technical roles. Their own field, their own network, a real gap in the market. Federal government was their largest customer. They passed $2M in revenue inside two years. If you were building a slide about doing this properly you would use them. Credentialed operators, a real edge, fast growth, a marquee client. And they were three months from handing it back.

What she called it, and what it was

Burnout. Both of them burning the candle at both ends, no gas left, wondering out loud whether they had the stamina for another year. 

That is how it arrives. Almost nobody opens with the real thing. They open with fatigue, because fatigue is respectable and it also happens to be true.
So I asked what the cash looked like.

Anyone who has built on federal contracts knows the shape of this. The work is real, the receivables are strong, and the money arrives on a schedule set by people who cannot reliably pass a budget. There is a shutdown in most years. When one lands, payment stops and payroll does not, and a business with excellent receivables sits there with almost no cash in the account.
That is not a performance problem. Nobody underperformed. It’s a timing structure, and no amount of effort from two very capable engineers changes a timing structure.

They were preparing to sell a good business in order to solve a timing problem.

Two questions

I asked how long it had been going on. Roughly three years, on and off, worse each cycle. Then I asked who else knew.

“Nobody. You're the first person I've said any of this to.”

Three years, $2M in revenue, a business that looked from outside like a case study, and the first person to hear the actual position was somebody she rang because she had run out of other ideas.

Why nobody knew

I’m not a trained psychologist, but I have a strong sense of the reason it stayed inside that house, and it’s more common than people think. They’re married to each other, and they are both in the business. When one founder carries the risk, the other is at least outside it. Not comfortable, but outside, and able to ask a question the founder can’t ask themselves. When both founders are the couple, that position does not exist. Nobody is left in the room who’s not inside the problem.

So the conversation happens between two exhausted people who already know everything the other one knows, which is not a conversation. It is a mirror.

So they worked harder.

Longer weeks, weekends, one handling delivery while the other chased collections. They tried to grow past a cash timing problem by adding placements, which meant more payroll ahead of more delayed payments.

Three years of that produced two things. Fatigue, and disenchantment with a business they’d been proud of eighteen months earlier. It produced no change in the thing that was actually wrong.

Why it is always motivation

It took me years to see this in my own company before I could see it in anybody else's. 
Motivation is the only remedy you can apply entirely on your own.

Every other fix for a cash problem needs somebody to let in. A lender needs the numbers. An advisor needs the real position rather than the presented one. A peer needs to hear how bad it actually is before they can say anything useful. Your own effort needs nobody at all.

So when the blocker is shame, and shame's whole requirement is that nobody finds out, effort is the only tool that fits the hole. It’s the one solution compatible with keeping the secret. Which is exactly why it’s the first thing we all reach for.

Every hour Megan and her husband worked was also an hour they didn’t spend telling anybody. And telling people was to expose a shame that neither wanted exposed. Afterall, how could two smart people leave stable engineering careers, build something to $2M in two years, yet can’t cover payroll in a shutdown month.

“We left good jobs for this, and we can't even make it work.”

That's what she told me on that call. A sentence more about them rather than about the business, and it behaves completely differently. Guilt gets you to the desk. Shame keeps you off it, then dresses the avoidance up as being busy --- which over three years is indistinguishable from commitment.

I recognized it because it was mine

I ran a company with substantial federal contracts with a hundred people on payroll. Three or four times a year, customer payments were late and I couldn't have told you on a Wednesday whether Friday would clear. Receivables looked excellent, and there was no cash. At one point I started drawing up my own shutdown plans and told nobody, including my wife, Christine, who got the mood at the dinner table and none of the balance sheet that explained it.

What ended it was not a system and not a better quarter. I mentioned the situation, informally, to a founder-friend. He was a person of high integrity and wisdom who, over the years, had earned all my trust. He had recently sold his business for a massive sum. He asked me about the receivables. Then he said a phrase I had never heard. Royalty-based funding. An instrument built for exactly that shape of problem, structured so the owners can work through their most difficult troughts while keeping the bulk of their equity. He introduced me to a firm that did it, and within six weeks we had closed an initial tranche.

What I told her

On that call, I told her four things, and not one of them was work harder.

1- Line up the royalty-based funding now. Before the next downturn, not during it. Strong receivables and a timing gap is the exact case these firms exist for, and the equity stays with you.

2- Put an advisory board around it. Because it’s the only room where somebody hears your real number and needs nothing from it. Your investors would price it. Your team would start updating their CVs. And your spouse, in your case, is inside the business, which is exactly why you've had nobody.

3- Stop being careful. Be properly verbose about the actual position with your staff, with each other, with anyone whose help you might need. Most of us carry corporate conditioning into this, where composure was the job. When you are drowning, composure is not the job.

4- Join a founder community. Most cities and plenty of towns have one. The value is not the events. It's finding out that the person across the table had a worse quarter than you did, said so out loud, and nothing bad happened to them.

Where they are now

Unfortunately, I was not in a position to serve on her advisory board, but I do know that they liked the idea and had begun conversation with a few experienced people. I checked with her a couple of weeks ago. They’re branching into adjacent sectors. Work close enough to what they already do that it doesn’t mean buying an expensive new capability, far enough from federal that it spreads the risk. That’s a considered move rather than a panicked one, and it is the right one.

They’re also in conversation with a royalty-based funding firm and have not decided yet, so it’s not all resolved. Congress will have another run at a budget later this year, and they’ll find out then whether what they have put in place is enough. But they’re taking steps, in the open, with people who know the numbers. Three months ago they were quietly working out how to sell.

Ten minutes against three years

I’m not smarter than Megan. She is a better engineer than I ever was, and she has run her business more carefully than I ran mine at the same stage. I could see it in ten minutes for one reason. I was outside it.

The diagnosis was almost trivially available from where I sat and unavailable from where she sat, and no amount of intelligence or effort was going to close that gap. Vantage point is not something you can work harder to acquire.

So the real bill for secrecy is not the feeling. What secrecy does is keep you standing in the one position from which the problem can’t be seen.

You’re not the only one

I still coach, and I see that nearly everyone is carrying a version of this story. Most have decided it’s simply part of the job. The tax you pay for running your own thing. Almost always, what they ask me for is a better system. And my feedback is always the same: Look at what a system actually is. A private fix, self-applied, requiring nobody's knowledge and nobody's permission.

So when a founder asks me for a system, I’ve learned to ask what they haven’t told anyone yet.

Where this doesn't apply

Sometimes a stall really is exhaustion. Sometimes it's a business the founder has quietly stopped believing in, and selling is the honest move. Neither of those is shame, and neither gets fixed by saying it out loud. Work out which one you have first.

Motivation is what you reach for when you can't see what's actually in the way. It’s also what you reach for when the thing in the way can only be seen by somebody you haven’t told. Shame doesn't respond to effort. It responds to being said out loud, and it gets smaller the moment it is.

Megan carried her shame for years. It took a 15-minute conversation to put down.

Until next week,
George