I’ve heard, and I can’t remember where, that the reason businesses don’t last is that someone doesn’t keep them in business long enough to make it.

A business is very much like any investment that accrues compounding interest over time. Skills, networks, clients… all of these gather momentum and aggregate over time. You know better what you’re doing. You make better decisions. Your staff is trained. You don’t waste as much money. Clients refer other clients that ad to your sales…

Josh (here’s his entrepreneur fight) has written more commentary on MWI’s 2006 financials on his Don Loper blog.

It’s interesting to have a business publish it’s income. I’d be surprised if it hurts him in any way but I’m sure he’ll let us know if it ever comes up when talking to a client.
Here’s what Josh feels he’s learned lately:

In looking over the financials for the last year, I started thinking to myself “Ok, if I hadn’t done that, I could have saved $20K, and if I hadn’t hired that person I could have saved another $50K and we probably would have gotten by ok…” etc. When I totaled everything up, there was probably $120K worth of expenses that were a total loss as far as return on investment, or could at least be debated as being a total loss. What else could I have done with that $120K?

When I was in college we used to play Risk (the board game) as marathon sessions with two boards. The games would take 8-10 hours with tiny incremental position changes. When someone looked to be gaining an advantage the other players would team up and take turns attacking the leading player.

But then a change would come. A subtle shift would benefit a player and advantages would multiply until, after hours of playing, it was a completely one sided affair that ended in minutes.

Perhaps I stretch the analogy a little but the point is that tiny shifts can equate to dramatic benefits over time.

It might even mean that Josh gets a pay check this year.