Tropical MBA: Entrepreneurship & Founder Lifestyle #809 Financial Traps, Profit Truths, and What’s Next at TMBA
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May 29, 2025 Greg Crabtree, author of *Simple Numbers*, shares his profound insights on overcoming the entrepreneurial plateau at $3 million in revenue. He discusses 'profit truth,' essential financial metrics, and the emotional hurdles that founders face in the growth journey. Crabtree emphasizes strategic hiring and financial education as keys to navigating the challenging 'Death Zone' of business. Listeners are also encouraged to share their transformation stories to help inspire fellow entrepreneurs, fostering a community of growth and innovation.
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Understanding the Death Zone
- The "death zone" in business often occurs between $1M and $3M in revenue due to scaling complexities.
- Owners must pay themselves a market-based salary to understand true profit and sustain growth.
Pay Yourself Market Salary
- Pay yourself a market-replaceable salary to get clear on your true profit and cash flow.
- Adjust owner's pay to market rates to transform struggling agencies into profitable businesses.
Be Accountable with Marketing Spend
- Always hold marketing accountable to effectiveness rather than increasing spend blindly.
- Growth is often an executional challenge, not simply a cash availability issue.
