The hard emotional side of entrepreneurship
When I started down the journey of entrepreneurship, no one told me that my own emotions would become one of the most difficult aspects to manage.
Yet, over the years, I've learned to see how my emotions can be detrimental to business and lead to very poor decision-making.
In this article, I'm going to talk through some of the emotional challenges that you may wrestle with as an entrepreneur, some of the pitfalls they got me in, and how I have done my best to overcome them.
You have two roles: "Owner" & "Team Member"
As an entrepreneur, you sit in two fundamental roles.
A business owner AND a team member.
Your company is built and made of other people that are working with you to achieve a common goal. You hire them, and they deliver work for you.
And if you have read my past articles on company culture, then you know that I aim to make work a fun place to be.
95% of the time you are a team member
95% of the time, you are working as a "team member" with the others on your team.
You collaborate on projects.
You advise and coach them.
You take feedback from them when they are right and you are wrong.
You work alongside them just like any other team member...
And in that time, you build relationships.
And you see your team build relationships with each other.
And then it hits...
The other 5% of time when you have to be an entrepreneur.
The dreaded 5%
At some point along the journey, it hits.
The moment when you are no longer a team member and, instead, have to put on your "business owner" hat.
These are the moments where emotions can stop you in your tracks.
These are the moments when your emotions can inhibit your judgement.
And these are the hard moments you must get better at...
Here are a few examples of the hard conversations I am talking about.
Layoffs
At one point, I had to lay off 6 people from Lead Cookie because I screwed up sales. They did nothing wrong. It was 100% on me and all of them had to lose their job as a result.
Sending someone's job offshore
At one point, once we had our systems in place, we transitioned some of the roles from US-based team members to Philippines-based team members. This generated an 80% savings, but it's not an easy conversation to have with anyone when you tell them their job is being shipped overseas.
Being afraid to make a decision because you know it's unpopular
Early at my B2B podcast production agency, I was a bit overwhelmed at one point and made a decision to give our writers a significant raise. The hopes were that this would increase the quality of work by giving them more time to work.
What I didn't realize was that in my overwhelmed state, I didn't really think it through and the rates were not sustainable.
This meant I had to come back at one point and basically slash my writers rates by 25% because I had made a mistake and had been overpaying them.
These types of conversations are not fun...
As an entrepreneur, you are going to end up having these types of conversations at one point or another. Unfortunately, I end up having more of them than I would like.
But having the conversations isn't the hard part.
It's becoming aware enough to have the conversations... that is what is hard.
Here's what I mean.
Emotions will cloud your judgement
When you look at your company finances, you don't just see numbers. You see salaries and people's livelihoods.
When it comes to asking, "How can we save money and build a better and more profitable business?", the answer often comes down to people, which are your largest expenses.
And if you didn't know these people... it might not be so hard to say, "Oh, just cut X & Y, and then margins will go up by 8%."
But this is not X & Y to you.
These are your team members.
The emotional side of things can cloud our judgement.
Here's what I mean.
I've held on to team members too long because I knew it would upset them
If I could only count the times I made this mistake in my entrepreneurial career... as a company grows, evolves, matures, and shifts, its needs will shift.
Inevitably, the person you need at one stage of the company will no longer be as relevant at another stage. It's not their fault, but the company just needs change.
One of the biggest mistakes that kills profitability is holding onto these people longer than you need to.
Letting a team member's personal life impact your business decisions
Another challenge comes when you start to know too much about team member's personal life. It makes it even harder. When you know they are going through a tough time, making a move, having health issues... it makes the decisions and conversations even harder.
Afraid to hurt culture
I've also delayed decisions like this at times because I was afraid it would hurt the company culture. And there is some truth to this. All of these decisions have a temporary hit to company culture, but in most cases the team knows that the decision is for the best of the company.
Smart businessperson or heartless bastard?
As you make these decisions that impact your team, you walk the line of either being a smart businessperson or a heartless bastard.
I've met entrepreneurs before who treated their team members like disposable resources. They had the power, they had the money, and they churned and burned their team without a care in the world.
Those people make me sick.
They probably make more money than me, but I could care less.
What I seek is to find that balance. One where I am being a smart businessperson, but still have some level of heart for my team.
Here's how I typically do that.
View your business as an owner first, team member second
Whenever I do my weekly financial reviews, I ask two questions:
"How can I save money this week?"
"How can I make more money this week?"
That first question triggers the unfun conversations. I look at my business holistically, and figure out what I can do to spend less.
Often, this comes down to team changes. It often shows up as answers that I don't like to look at, but I know they are right.
I write down the answer, and then, typically, I give myself a week to think on it. When I ask the question again the following week, if that is still the best answer, then it's time to take action.
Self-Awareness is key
While the question above is a helpful tactical element of making sure you don't delay these important decisions, a big part is just self-awareness.
You need to recognize when you are looking away from an important decision because you don't want to deal with the hard conversations.
There's no magic formula, only an awareness of yourself and your emotions.
How I handle these tough conversations
While there is no easy way to have these conversations, here is what I have found is the most effective.
Write out your talking points
Don't wing it on this. The communication of what you are about to tell this person is essential. Every word and detail counts as one slip-up can send the whole conversation in a bad direction.
Since we are remote, typically I write my thoughts out and then I screen share as I walk through the decision. Then, I share that write-up with them afterward so they can digest.
In the moment, someone may get upset or emotional in these conversations. Having something they can go back and re-read is helpful.
Be transparent
Others would disagree with this, but my approach to these conversations is radical transparency. I never lie or try to conceal the truth of the situation. I simply share it as is.
Sometimes, it's simply showing them the numbers.
Other times, it's the candid fact that the company is shifting and the needs are shifting.
Whatever it is, be transparent and honest. People will respect and appreciate that.
Emotions and entrepreneurship are tied together
While it would be wonderful to make logical decisions all day in your business, that is unfortunately not always the case.
Emotions come into play, and they will cloud your judgment.
This article hasn't been a specific "how to," but hopefully you can relate to some of the challenges, or at least be warned of what is coming on the path ahead.