Great Contradictions

“Elements” – Great Contradictions: A famous adage for entrepreneurs comes from Warren Buffet: “The most important thing to do if you find yourself in a hole is to stop digging.” Another comes from Donald Trump: “Never give up.” The two iconic bits of advice from two of the most famous investors are contradictory.
Generally, entrepreneurs must dig themselves into a financial hole; the question then is how deep do you go? My advice is that you must determine the depth of the hole that you and those around you are willing to risk. The decision is extremely difficult because once in that hole, an entrepreneur always hopes that one more shovel full will lead to venture success…and they may be right, but the odds are against them. Great expectations are a crucial aspect of entrepreneurship; why else would you put yourself into such financial risk.
What do you do then when you are deep in Buffet’s famous hole? The venture should not be automatically shut down, but it is time to reassess. You should determine whether taking more risk is worth the potential gain. The real question is can you survive if the venture fails when you are in a deeper hole?
When such a decision point is to be made, outside advice should be sought as the entrepreneur can become blinded to the consequences of proceeding. Going beyond the depth of an “acceptable” hole is the dark side of entrepreneurship. No venture is worth the destruction of family well-being. Know your limit.
The bottom line is to follow the wisdom of both of the great investors. Never give up until you reach the limits of the hole that you have chosen. Don’t then just quit, but carefully determine with others before you dig any deeper.