Thoughts on revenue versus profit

If you are building a business, or if you are self-employed, are you trying to grow to eventually become profitable? Instead of focusing on rapid growth and ever increasing revenue, why not focus on growing sustainably and profitably from day one?

The saying is “revenue is for vanity, but profit is for sanity.” Who cares if you had millions of dollars in revenue when your business is not profitable (or is barely profitable)? Why would you want to work so hard and not make any money? It might sound good when you tell others how much you sold, but it’s not the top number that matters. It’s not how much you make, but how much you keep. What is your net profit?

Keep your ego in check. Focus on being profitable, on doing things the right way, on helping as many people as possible, and forget about the vanity metrics. Over time, they will eventually come. But just like a lack of sales can kill your company, so can growing too fast. Grow sustainably and do it right from the beginning otherwise it is going to be much harder to try to put the systems in place after the fact.