GNT #178: Your best year on paper
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There was a stretch in my fractional practice when my book was full and the numbers were the best they'd been. Good clients, good work, checks that cleared.
Every one of those yeses made sense the day I said it.
Then a new client came in hot. They wanted someone fast, they were thrilled to have found me, and honestly, I was thrilled right back. (A client that eager to start is a very effective way to switch off your own judgment.) So I said yes, and I said yes right now, with no padding between them and another client I was winding down.
Winding down is the careful part. I was handing that client off to a brand new marketing director and getting the systems in place so the whole thing would hold smoothly after I left. The kind of work that decides whether an exit looks generous or sloppy. And I chose to start a demanding new engagement right on top of it, with everything else still humming underneath.
On paper, my best stretch just got better. Another client, more revenue, momentum. In real life, that one yes showed me what all the yeses had been costing. I was running an ending and a beginning at the same time, on top of a full book, and every piece of it deserved a better version of me than the one I had left to give.
The new deposit looked like pure upside. It wasn't. It cost me the room to end one thing well and start the other right.
Today I want to show you the number that would have warned me, and how to check yours before your next yes.
Let's dig in.
Revenue is the number we clap for
I get it. It's the scoreboard, the one you put in the year-end recap, the one that comes up at dinner with friends, the one that sounds like proof you're winning. But it only tells you half of what happened. The other half is the question almost nobody asks:
What did that number cost you to put up?
That cost has a name. It's your margin.
Margin is just what's left over. In money, it's your profit: what stays after you've paid for everything the work took. But there's a second kind of margin, the kind that never shows up on a spreadsheet, so nothing warns you when it's running out. It's what's left of you. Your time. Your energy. The room in your own week.
So there are two numbers here, not one. Revenue is what comes in. Margin is what's left after. And they can move in opposite directions. You can grow what comes in and shrink what's left at the same time. Your best year on paper can be your worst year in your body.
Mine had been moving in opposite directions for a while. It just took one eager yes to make it obvious.
Not all revenue costs the same
Every new piece takes a bite out of your margin, and the bite is rarely the size of the check. Some revenue is cheap. It fits what you already do, it holds its price, it leaves your week alone. Some revenue is expensive in ways the number never shows. It comes in on top of something else, or pulls you into work you're slow at, or eats the padding you didn't know you needed until it was gone.
On the top line, those two look identical. They add the same amount to the number you clap for. What they take from your margin is worlds apart.
Takeaway
Big and small, I believe the businesses that last protect their margin. Sometimes that means turning down real money. Sometimes it just means saying not yet, and leaving the space between the ending and the beginning, because that space is worth more than the deposit that would fill it.
None of this means want less. It means measure better. Growth that costs you more than it makes you isn't growth. It's just a more expensive way to end up with less.
So before you celebrate the next number, or wear yourself out chasing it, ask the second question first.
Not what will this add.
What will this leave me with?
I'm always rooting for you. See you next week.
-Colleen
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