It makes sense that “M” would be for Money, right? I mean, I am a money person. I deal with money all day long – my money, investors’ money, client money. It is all money, all day.
I HATE money. OK, that is not entirely true. What I hate is how our relationship with money, both good and bad, affects everything we do.
I believe there are universal money truths. Many of those truths are fear-based and have devastating effects on people and their businesses.
One truth is the fear of scarcity – of not having enough, of needing more. It is paralyzing. And, while, this particular truth translates into many things other than money, if we really drill down, we will always find money in the mix.
Another truth is that living in that paralyzed state damages everything in our lives and we don’t even know it is happening.
I recently watched this unfold with a non-profit agency I am affiliated with.
For many years, the agency was in a cycle of money paralysis. There was never enough money. Every day, there was some new crisis, bill, financial catastrophe. Over time, the powers-that-be became so numb to the next crisis that crisis became normal. Fear of not having enough money created a vacuum. The fear became the focus of every decision. No one had the energy to look for solutions.
The fear of the monster under the bed had grown a life of its own and no one considered life without the monster.
Three years ago, we tackled the monster. We made sweeping changes in the financial structure. We revised, revamped, changed and recharged every single aspect of how money was dealt with. Every. Single. Aspect.
It took almost 2 years to stabilize things. It was a thing of beauty. We patted ourselves on the back and wanted to sit back and enjoy our success.
What happened next was not a thing of beauty.
All of a sudden, seemingly out of nowhere, we were in perpetual crisis again. This time, it was not financial crisis. It was everything else.
The truth is that the issues that seemingly came from nowhere had been there the whole time. We just didn’t know it because of our paralysis.
I see this with factoring clients all the time. By the time they find us, the fear is so consuming that other things in the business are ignored or pushed aside. Inevitably, once cash flow is leveled out; the other things begin bubbling up.
Incorporating this understanding into our message is one of the things that set LDI apart from other finance companies. We know it is going to happen and we can often pinpoint where it is most likely to start. As a result, we start early outlining what we see and try to help put strategies in place to help overcome the hurdles we see for our clients.
Last week I participated on a panel for women entrepreneurs. While the five of us hadn’t met before sitting down at the front of the room, our stories were eerily similar. We ended up talking a lot about money, our relationship with money relative to our businesses and our mistakes and successes along the way.
The key theme that resonated through our stories?
- You have to know your numbers
Whether for your business or personal life, you have to know where your money is going and what it is doing for you. That is the ONLY way you can make strategic decisions about where to focus your energy; what to expand and what to cut. It is also the only real way to prevent the paralysis.
Always look under the bed. Once you know what the monster looks like, it is rarely as scary as you imagined.