If you’ve been in business long enough, you know the swings I’m talking about. One day you want to quit, the next you sign your biggest client. One day you’re raising a huge round of funding, the next you’re facing your worst sales month in years. I’ve been there. In the same week we raised our first funding round, we lost 99% of our revenue. That’ll test your nerves.
Early in my career, I let myself feel everything at full intensity—100% elation when something went right, 100% despair when it didn’t. And here’s the truth: the human mind and body can only handle that for so long before you burn out, break down, or end up in a place where someone takes your shoelaces away “for safety reasons.”
The 50% Rule is simple: when something incredible happens—your biggest funding round, your largest customer—let yourself and your team feel 50% of the excitement you naturally would. The same on the way down: if something terrible happens, only allow yourself to drop 50% as far. Stay in that middle range where you can make clear-headed decisions without getting whiplash from the ups and downs.
This is the best way to protect not only your sanity and your employees’ sanity, but also your and their tenure in the business. And if you ask any successful entrepreneur, one of the biggest drains on a business is losing good employees—so you want to be very cautious here. Retain good people. Don’t let them burn out along with you.
Now, I’ve noticed that lifelong entrepreneurs—the kind who sold candy in school or mowed lawns on weekends—tend to handle the volatility better. I believe I’m one of those, but even I had my breaking point, ending up in the hospital multiple times for issues that could only be attributed to riding the highs and lows at full intensity for 15-plus years. Another reason lifelong entrepreneurs manage better is because, after thousands of swings, they’ve learned that the highs are never quite as high as you think they are, and the lows are never quite as low. That experience makes it easier to self-regulate.
Most of your employees aren’t wired for that. They’re civilians in this game. If you expose them to the full range of emotional extremes, you’ll burn through staff faster than you can replace them.
You might be able to handle the full force of the swings (though I still don’t recommend it), but your business can’t survive if your team can’t. Protect them from the extremes, keep everyone steady, and you’ll have a much better shot at long-term success.