TLDR:
- Analyze the feedback you’ve been receiving from the market at both a direct and indirect level
- Determine if the time and money you’ve invested is worth the payoff you’ve received given the ongoing duration of the business
- “Times change, people change.” Determine if any volatile changes in the market is only hurting your business’ outlook
- Setbacks will be along the way no matter what you’re doing. But are they way too consistent and major than normal?
- Are you still passionate about what you’re doing?
Determining if it’s time to pull the plug
As an entrepreneur, we’ve all had that idea that we believe is grandiose and will solve all the problems we’ve been facing.
But what if it isn’t as grandiose as we thought it would be?
We’ll discuss 5 determinants you can use to answer the question.
1. Market Validation
Depending on how long you’ve been in the market, what is the recurring theme of the feedback you’ve been receiving from relevant consumers? Have they been purchasing your products or services at a volume you forecasted, or does it turn out there’s not as much demand as you thought there’d be?
Engage with both potential and current customers to determine whether or not it's ideal to reassess.
2. Financial Sustainability
You’re probably not just investing time into your business idea, but also money. Given the duration at which you’ve been working on this and the money you’ve spent, has the output been as you were hoping it to be, or have your resources been completely drained without any clear path to financial sustainability?
3. Market Dynamics
As the saying goes, “times change, people change.”
What was once a viable business idea with a high ceiling when you started may not be the case anymore. Many factors contribute to this, especially the changes in tastes and preferences of consumers.
If the changes in the market you’re in too volatile and is only hurting your business further and its ability to compete.
4. Persistent Setbacks
Naturally, there’ll be setbacks along the way to reach any ultimate end goal. However, if it’s to the point where they are way too persistent at an insurmountable level irrespective of the shifts in strategies you’ve made, it can serve as a strong indicator to evaluate the future of your business idea.
5. Lack of Passion
Passion is the most important thing to have in pursuit of a business idea.
Do you not have as much interest and enthusiasm as you initially did? If this is the case, it’s more than likely affecting your motivation and hindering your ability to overcome obstacles in your way.
You should probably move on.
Moving on from what may have started as a passion project is excruciatingly difficult, particularly if you still have the passion for it. However, if you know that the final boss is impossible to defeat no matter what you try, then it may be time to pull the plug.