My mom grew up during the Depression, and there were stretches when there wasn't enough food. When she passed away, she was living by herself. She had a refrigerator full of food and two standalone freezers full of food. For one person.
For a long time I'd look at those freezers and wonder why one person needed so much. After going through my own financial crisis, I think I understood something about her that I couldn't have understood before. I can't know everything that was going on inside her. But I don't think she was stocking those freezers for the life she was living. I think she was protecting herself against the life she remembered.
I wonder how many entrepreneurs are doing exactly the same thing with their businesses.
If you've come through a hard stretch, your company is healthier now, and you're still making decisions like disaster is around the corner, here's what I've come to believe. Our circumstances can change much faster than our relationship with those circumstances. Sometimes the caution is exactly right. And sometimes the business has changed, and you're still stocking the freezers.
Is It the Business at Risk, or the Feeling You Remember?
I've worked with a number of entrepreneurs whose businesses have recovered financially but whose decisions are still shaped by an earlier crisis. Some resist hiring. Others postpone investments they've been talking about for years, or become very conservative about which sales opportunities are worth their team's time. The details differ. The question I eventually ask is similar: are we protecting the business against a risk that still exists, or are we protecting ourselves against a feeling we remember?
I understand that fear. I've lived it. When you've spent years worrying about making payroll, you don't wake up one morning, look at a healthier balance sheet, and suddenly feel safe. Some of the behaviors that helped me survive my financial crisis were exactly what I needed at the time. I watched every dollar. I questioned every expense. I worried constantly about what could go wrong. Those habits helped keep Diversified Industrial Staffing alive.
But before I challenge anyone's fear, I want to understand whether the numbers support it. Revenue alone doesn't tell me that. A company can have its best sales year ever and still have a cash-flow problem. It can have record revenue and shrinking margins, receivables that aren't getting collected, too much revenue sitting with one or two customers, or debt obligations that make another salary a real risk. So I want to see cash flow, margins, reserves, debt, customer concentration, the quality of the pipeline, and what the specific decision we're considering would actually cost.
Sometimes the numbers tell me the entrepreneur is right to be cautious. Plenty of founders who've been through a brutal stretch decide they want six months of operating cash instead of three, and depending on the business, that can be entirely rational even while revenue is growing. Sometimes the numbers tell a very different story. And sometimes the business has improved significantly, but the entrepreneur is still making decisions as though nothing has changed. That's where scarcity becomes a problem: when the business changes and the behavior doesn't. It's also worth saying that a founder can have a scarcity mindset and a legitimate liquidity problem at the same time. That's exactly why you have to look.
Sendhil Mullainathan and Eldar Shafir spent years studying what scarcity does to people, and wrote about it in their book Scarcity. In plain English, they found that when people are genuinely short on something, money or time, their attention narrows around the shortage. They get very good at handling the immediate problem and have less bandwidth for anything else. Their research helps explain what can happen while people are living with real scarcity. What interests me is something I've observed in my own life and in coaching: sometimes our circumstances improve long before our behavior catches up. The research doesn't establish that for entrepreneurs, but I think it's a useful question to explore.
What Would Letting Go of Survival Mode Threaten?
"Shift to an abundance mindset" is easy to say. If it were that simple, nobody reading this would still be stuck. So I get curious about what letting go of the old behavior might cost.
Here's the uncomfortable possibility I eventually had to face in my own business. What if the behaviors that helped me survive were becoming the behaviors preventing me from building the company I actually wanted? That's hard to consider, because those behaviors don't feel like habits. They feel like the reason you're still standing. Letting go of them can feel like abandoning the very qualities that got you through, and maybe a little like tempting fate.
Sometimes I also wonder whether the fear has become connected to something deeper than money. If I've spent years being the person who holds everything together, what happens to my identity when the business no longer needs me to rescue it every week? Who am I when I'm not the hero? I don't assume that's what's going on for any particular founder. But it's worth asking, because if the answer is yes, no spreadsheet is going to settle it.
How Does a Founder's Fear Become the Company's Operating System?
Here's where this becomes a business problem. A founder worries about running out of money, so they delay hiring. The existing team absorbs the additional work. Eventually capacity gets constrained, response times stretch, opportunities get missed, and good people burn out. The business begins experiencing the very problems the founder was trying to prevent. Then the founder looks at the slower growth and says, "See? I told you we couldn't afford another person." Maybe that's true. But it's worth asking whether the decision not to hire contributed to the problem.
There's another part of this that entrepreneurs sometimes miss. Your team has been learning from you the entire time. If they've spent years hearing "we can't afford that," "don't waste time on uncertain prospects," "hold off on hiring," and "protect every dollar," they've adapted to it. They stop proposing investments. They stop raising resource problems, because they already know the answer. Some start measuring their own success by how little they spend. Eventually the founder's scarcity becomes part of the company's culture.
So before assuming the whole team has a scarcity mindset, I'd ask a simpler question: what have employees actually been told about the recovery? If they lived through layoffs, hiring freezes, or financial uncertainty, they may be responding to the last reliable information leadership gave them. The founder may know the business is healthier. That doesn't mean the team has been given enough evidence to believe it.
That's why a founder's breakthrough on a coaching call isn't enough by itself. You can't spend years telling people there's no money and then expect them to operate differently because you had an insight on a Tuesday. You have to give them new information, set new decision boundaries, change who gets to decide what, and show them through your own behavior, repeatedly, that the rules have actually changed. That takes time, and it should.
None of this shows up on the P&L. The hire that didn't happen. The investment that sat in the maybe pile for another quarter. The top performer who left because relief never came. Every one of those has a number attached, and you pay it whether you ever see the bill or not.
Leading the Business You Have Today
Once you separate the financial facts from the fear, you can finally look at the real problem. Where is the actual bottleneck? Is it sales capacity, or is it delivery? What work are your best people doing that someone else could own? What would an additional hire cost, and what capacity or revenue could that investment realistically create? Sometimes the answer is a salesperson. Sometimes it's an operations hire or an account manager, and adding sales would only pile more work onto a team that's already underwater. That's when you can make a decision based on the business rather than the memory of its worst year.
A few things I've seen help.
Compare then and now. Write down what was true when the fear took hold: cash, margins, reserves, debt, customers, team. Then write down what's true today. Be specific. Some of it may tell you to keep being careful. Some of it may not.
Decide what financially safe looks like before the next slow month. What level of cash reserves do you want? What margins are acceptable? What demand or capacity indicators would justify another hire? Establish those numbers now, while you're calm. Then, when the fear comes back, you have something more reliable than your mood to consult.
Get a second set of eyes on both the numbers and the fear. That could be a coach, but it doesn't have to be. It could be a CFO or financial advisor who'll tell you what the numbers actually say, a Forum mate, a mentor, or your spouse. Tell them the fear itself, not the cleaned-up version.
Pick one survival behavior to examine. Not all of them. One. The expense you still insist on approving personally, the hire you keep postponing, the sales rule that made sense three years ago. Ask whether it still serves the business you have now.
And expect the fear to come back. A slow month will show up, and the old voice will say, "See? I told you." That doesn't erase the progress. Growth can simply mean noticing the fear sooner, checking it against current evidence, and making a more deliberate decision than you would have before.
The behaviors that helped you survive your worst year may not be the behaviors that will help you build your best one.
So here's what I'd sit with this week. What part of your identity is still tied to surviving a crisis your business may have already outgrown?
And what decision would you make differently if you allowed yourself to lead the business you have today, instead of the business you were terrified of losing?
If those questions are hard to answer on your own, let's talk.
Todd
Frequently Asked Questions
What's the difference between a scarcity mindset and legitimate financial caution? Financial caution responds to what the numbers say today: cash flow, margins, reserves, debt, and customer concentration. A scarcity mindset keeps making the same defensive decisions even after those numbers have changed. A founder can have both at once, which is why it's worth looking at the actual financials before deciding which one you're dealing with.
Does record revenue mean my business can afford to hire? Not necessarily. A growing company can still have cash-flow problems, shrinking margins, uncollected receivables, or too much revenue concentrated in a few customers. Look at the actual economics of the specific hire, identify the real bottleneck, and decide.
How do I help my team move past a scarcity mindset? Start by asking what they've actually been told. Teams often respond to the last reliable information leadership gave them. Share new information, reset decision boundaries and ownership, and show through consistent behavior over time that the rules have changed.
