Investing in Growth Is Not Always Good for You

The current financial disasters prompted me to look at something I wrote a few years ago. Would we be in better shape now had more people followed the advice?

“Grow or Die”. That was the mantra I heard as a young entrepreneur and, I suspect, you hear it, too. I was young then and, like most young people, unaware of my own mortality. Now retired, I am well aware that my time here is limited. So, I’d like to share a lesson I learned only when I was in my 60s.

Most things on this earth grow, it is a certainty that all things die. Why should a business, a living organism, be different? It doesn’t matter the industry or whether the company is a manufacturer, distributor or service business; growth stops, death arrives. True, death comes later to stronger companies and may be postponed by mergers and acquisitions. But come it will. The smart businessperson understands this reality and adjusts accordingly.

As death is a reality, so it is that many of us will not build billion dollar businesses, no matter how hard we work, how much capital we raise, how smart we are, how brilliant our idea. It’s a fact of life that not all of us will be superstars. But there is nothing wrong with building a “nice, little business”, one that supports several families in relative comfort, provides a useful product or service to the community, enables its employees to use all of their talents, is fun to work at. For most of us in our rational moments such a business would represent something close to nirvana. However, ambition often blinds us. We must build another factory, establish a London office, raise millions from venture capitalists.

I’m not saying that one accepts the status quo and does not strive for the stars. Without ambition, drive and hard work you won’t start, let alone build, a business. However, there comes a time in life (yours and your business’) when you have to accept and live with reality. It’s easier to do so if your business caters to a local market. But, many companies are after a national and, even, a global market where the stakes and rewards can be much higher. That makes the task of accepting reality harder, but also more important to yourself (and to the economy in general, as it is likely that better use can be made of assets deployed in a futile attempt to be a superstar).

Yes, it’s not easy abandoning one’s dream, to recognize or admit that your creature, born amidst such great hopes and dreams, has not turned out to be the barn burner you expected. Nor is it easy to see that additional investments of time, money and talent will not be rewarded by the marketplace. But, if one does have the presence of mind and courage to see the world for what it is, the rewards – not necessarily financial rewards – can be considerable. When you stop beating your head against the wall trying to overcome the judgment of the marketplace, you sleep better, are less stressed, can devote more time to your community, can explore your whole self. You’ll find that reality is not so bad after all.