The average startup founder is generally a very poor poker player.  Of course, the skills needed to attract and retain top talent; or to convert cold VC introductions into hot checks are not the same as taking a dead hand from behind to a winning big stack in Texas Hold ‘Em; but after 2 months of lockdown and hundreds of Zoom calls with determined founders, I am fully convinced that too many founders do not possess the most important founder skill – knowing when it is time to stop your business.

Stopping a start-up is incredibly difficult. The massive industry that encourages dreamers and pragmatists to start big companies around bigger ideas to solve the biggest problems is united in one single belief – “your start-up is your baby and you never quit on it!”. 

The fact that 90% of startup businesses stop operating within 2.5 years, and the opportunity cost and lost cash associated with staying at the table with a losing hand, it is a much more preferable outcome to stop your venture at the right time. I have found there are usually strong early indications that a business is not fully viable long before the low sales, low cash point of no return that most popular Google searches identify as the time to fold. 

I am sharing three simple warning signs from observing hundreds of early-stage ventures (and losing thousands at poker) to help you know when to walk away or knowing when to run.  



Overcoming initial skepticism is part of the game for a startup founder. Unless you have multiple previous exits and household name recognition, convincing others that your idea is the beginning of a hugely successful business is merely the price to play. Those who persevere through all the objections are generally rewarded with early capital and early sales needed to create their dream business.  

Around the world, startup consultants and advisors like myself help founders refine attention-grabbing 1-minute pitches; and work tirelessly on narratives that anticipate every question or criticism. The result? Many founders become great at teaching but remain weak at learning.  All too often, founders mistake the silence when no one is challenging their business as proof they are right; ignoring the likely possibility that everyone has given up trying to save you.  

I recently experienced a founding team call to celebrate that a trusted advisor had suddenly stopped objecting to how the business was portrayed externally and had become silent.  Advisors are certainly fallible, but when internal advisors and external skeptics stop trying to course correct you, it is not usually because they are now convinced of your business’ strength,  but rather they have given up trying to enlighten you of the not so visible weaknesses. 

Low sales, disappearing cash, and low customer momentum kill businesses but do not happen overnight.  Most often the objections raised early in your venture’s life point to core weaknesses in your business. It is all too easy to dismiss the objections that do not align with your pitch and vision and seek comfort where everyone agrees with you. But, as a startup founder, the moment people stop questioning your business is the FIRST WARNING SIGN that you may not have the strongest hand in the game. While this is not a sure sign to immediately fold, the wise course is to hold and take a deep look at your assumptions with fresh skeptical eyes.


Long before I got the nickname ‘Poker Plonker’ and still dreamed of making money on Thursday nights; I received the single best advice I never took. “Winning cards are never in the deck waiting to be dealt, they are always in other hands waiting to be played.” Heeding this advice would have saved me many huge losses. Early in the game, if you do not already hold a winning card, then FOLD ‘EM and walk away.

Leaving aside the age-old business school debate of whether the value is created or captured, it is clear that very successful early-stage ventures most usually hold one or more winning cards from the outset. Talent that has succeeded before; above-average early funding advantages; a strong technology edge that they alone can best exploit; a customer relationship not available to most others; or a market asymmetry that exists at just the right time in industry cycle.  Startup success is obviously possible without one of these ‘cards’ in your hand at the start, but like poker, startup success is more correlated to improved probabilities, than to wide-open possibilities. 

Playing the odds in the cards, and not the hopes of the cardholders would lead to greatly improved outcomes for most founders. Once a venture gets its first funding, it is then already too addictive to stop the business before it flames out. Isn’t money on the table a sign that something is going right? Just as poker players make blind bets to begin the game and see the cards in a hand, so too do investors provide funding that is entirely unlinked to the odds of winning a hand. 

If by the end of your first raise you do not have one of the proven winning cards in your hand, then this is the SECOND WARNING SIGN and the odds are not in your favor. Playing the odds would mean this is the time to fold your venture and walk away.



“When the facts change, I change my mind” is a much-loved Winston Churchill quote that investors often use to explain a change of position in an investment. Leaders and investors who put facts before emotions and take decisive action are often lauded for not holding on to a bad or losing position in light of new information. 

As I engage with founders across the US, UK, or Africa, I am shocked by the resistance I find among many founding teams to acknowledge that a particular market event may have changed the facts for their business to such an extent that the winning course of action would be to stop the business. 

To be clear, a robust business model and execution should withstand even significant adverse events, and startup founders are among the most adept at making pivots and rapid testing various iterations of their business to weather the unavoidable headwinds. However, as has happened to many startups in both the travel and the event and conference space due to Covid-19; or to an electric vehicle startup I follow where Tesla has just entered the exact space, sometimes the facts change.  

If when you engage with customers and investors a single market event comes up repeatedly, that is the THIRD WARNING SIGN and a strong signal that the facts may have changed. Recognizing that change in facts and knowing it is time to run is not a failure, but is the smartest change of mind you may have for your venture.

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