What to do when your business spends more than it makes
When operating expenses heavily outpace revenue, founders face the uncomfortable reality of funding a business that the market may not want enough. This financial imbalance forces tough decisions about whether to keep investing capital or admit defeat and stop.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
Found another way around this?
Share your steps and trade-offs so fellow engineers don't have to reinvent the wheel. No account required.
What to do when your business spends more than it makes
- 1relying on a full-time job to afford business expensesDid this help you?
- 2treating ongoing losses as normal early-stage investmentDid this help you?
- 3implementing a short written scope signed before work startsDid this help you?
- 4using a written change order process for anything that shifts afterDid this help you?
- 5maintaining an audit trail with timestamps, signer IP addresses, and email verificationDid this help you?
- 6Selling the businessDid this help you?
- 7Trying to protect margins while keeping enough staff on the floorDid this help you?
In their words
Unedited, grouped by where they were said, most upvoted first within each place, each linked to the thread it came from.
“Weve been struggling with margins this year even though sales havent fallen off a cliff.”source ↗
“Working without a written scope before starting is the one that cost me the most.”source ↗
“Won a contract with my family business that I did not want to bid on but my Father did. Lost millions of dollars and the 45 yr old company had to go into bankruptcy.”source ↗
“It was a low bid contract for work we had been doing for years the volume of work listed to be bid on was completely inaccurate and it had to be be bid per trip so the numbers were way off.”source ↗
“Runaway pricing is the newest headache I don't want to deal with.”source ↗
“i looked at the numbers for my small software business: ... and revenue was exactly $49/month”source ↗
“none of those things changed the uncomfortable reality that I was spending more than six times what the business made”source ↗
“another part wondered whether I was paying to avoid admitting that the market wasn’t interested enough”source ↗
Where this came up
People with this problem also raised
- 8Making less money after starting a business
- 3Why do acquired businesses end up overvalued?
- 12Funding my business out of my own pocket
- 3How to fund inventory for a growing physical product business
- 2Why do companies show profits while ignoring expenses?
- 5How to turn a business idea into reality with no money