For the first few years at HighTower, every month I would dread the call with my CFO to see how much money we lost that month. I recall the surreal sensation of being happy if we lost less than the prior month, let alone generated a positive result.
As any entrepreneur knows, the challenge of getting enough revenue in the door to support operations is the first and most important milestone for any business that wants to grow. If you don’t hit that milestone, you're constantly drawing down on a limited supply of capital. If that capital runs out before you’re generating enough earnings to keep the business going…you go out of business. The number-two reason for startup failure is running out of cash.
Amazon famously prioritized growth early on, and did not turn its first quarterly profit for seven years (founded in 1994, first profitable quarter in 2001). It took Tesla 10 years to report a quarterly profit (founded in 2003, posted first quarterly profit in 2013).
I’ve had a lot of “best days at work” since launching HighTower in 2007. But the one that stands out most sharply is the day we reported our first earnings as a profitable company.
This was an amazing day because it meant we were self-sustaining and self-funding—an achievement we had been working towards since launch. We ran a lean, scrappy operation. No frills. Every dollar we spent was in service of one goal: growth.
Crossing the chasm from losing money every month to actually making profits felt like a massive accomplishment, until we set our sights on our next target – expanding our margin! #BestWorkDay