Just Figuring It Out Podcast · Episode 2

Why More Revenue Won't Fix Your Cash Problem

Profitable on paper but broke in the bank? Will, Alex, and Ian talk about when the cash crunch finally shows up, why debt and more sales only cover it up, and the mindset that keeps owners chasing revenue.

With Will Boyd, Alex Engar, and Ian Hogan · 41 minutes · July 29, 2026

The Short Answer

More revenue rarely fixes a cash problem, because the problem usually isn't how much you sell. It's what you keep and whether you understand where it goes. If your margins are thin, your systems are loose, or you're already at full capacity, growth adds people, overhead and risk faster than it adds cash. Many owners cover the gap with lines of credit, stretched vendor terms or easy loans until they run out of options. The fix starts with knowing your numbers every month, asking what the extra revenue is actually for, and growing from a business that already works.

When "Profitable but Broke" Finally Shows Up

Will hears it on calls with owners almost every week. Not long ago an owner doing $8 million a year was asked if the business was profitable. His answer: "I don't know, I think so." The feeling usually doesn't show up in week one. Ian sees it surface at a few predictable pressure points, the moments when you have to come up with cash or look hard at the numbers.

The Easy Fixes That Hide the Problem

Alex's view is that most owners don't feel the problem until they run out of easy fixes. One bad month doesn't do it. It creeps up, and debt covers it while it does.

• The line of credit. Pull from it, max it out, then get another one.
• Stretching vendors. Net 15 becomes net 30, then 45, then 90, until a couple of vendors past 120 days start calling.
• Easy money. Merchant cash advances and quick online loans that show up in your email and texts every day.
• Old relief money running out. Alex started seeing this around 2023, when owners began repaying pandemic-era loans and the cheap money stopped propping them up.

It's harder now because borrowing costs more than it did three to five years ago, and variable-rate debt that used to be cheap isn't anymore. None of these fix anything. They buy time. At some point the bank balance is consistently smaller than it was a couple of years ago, and you have to face what's actually happening.

Why More Revenue Usually Makes It Worse

When cash is tight, the natural move is to sell more. Ian's point is that most owners trying to grow out of a cash problem weren't in a strong position to grow to begin with. They just didn't know it.

Same take-home either way. The first option usually means more people, more risk and more of your time.

A lot of owners are already working at 100% of their time and cash when they try to double. There's no buffer, so any stumble hurts the core business. Some other ways growth backfires:

• A new division is a new business. A contractor moving from residential into commercial work, for example, may wait a long time before that division pays. The existing business has to fund that runway, and if it's already struggling, the problem compounds.
• The profit valley. Early on, a small team can make good money. Then there's a stretch where you've added overhead, space and people but aren't big enough to cover them yet. Alex recently talked with an owner who would make more money if the business shrank by about 60%.
• Bigger isn't always happier. Will has met plenty of owners with several times the revenue who make less than ever and spend their days on HR and legal headaches.

To see how the mechanics work (receivables, debt payments, owner draws and taxes), read our guide on why you can be profitable on paper and still have no cash.

The Hunter Mindset: Trying to Out-Earn the Problem

Alex describes one money archetype he sees often: the hunter. Hunters solve financial problems with more activity. More sales, more jobs, a new offer, without stopping to ask what's actually working. The root cause underneath, he says, is owners not taking responsibility for understanding the mechanics and the financials of their own business. Making more money doesn't fix not understanding your money. It scales it.

There's often an identity piece too. Owners who can recite their growth rate for every year since 2021 sometimes tie that number to whether they're a good owner, a good provider and a good boss. Ian put it this way: many of these owners don't feel like they're enough unless they're doing stuff.

Will told a story about a boot camp fitness owner who was fighting to hold onto a one-day event against a competitor, even though his one-day events barely made money. The answer he got: let the competitor have it. They'd be building a broke business. A lot of owners spend real energy defending revenue that isn't serving them.

What to Do Instead

Ian's exercise for hunters is simple. When you feel the urge to act, ask yourself "and then what?" Answer it, then ask again. Keep going. Most of the time you end up right back where you started, and you can ask what you're really trying to feel. For someone wired to act, the harder and more useful move is often to wait and think first.

Alex's version: choose your hard. You can keep choosing the pain of growing without cash, or choose the discomfort of slowing down, questioning how fast you're growing, and checking whether it's serving you. Going a little slower now is often how you go further later. A rolling cash forecast helps here. Our free 13-week cash flow workshop shows you how to build one, so you can see a cash crunch coming before it hits payroll.

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