This is a subscriber-only article. Join Entrepreneur+ today for access

Learn More

Already have an account?

Sign in
Entrepreneur Plus - Short White
For Subscribers

Ask a Pro: Closing Time With businesses everywhere struggling, how do you decide if it's time to throw in the towel?

By Jennifer Wang

Opinions expressed by Entrepreneur contributors are their own.

Q:When is it time to call it quits?

A: What business isn't struggling right now? But still, there are some red flags:

You find yourself positively spinning--or outright denying--the negative numbers.
Entrepreneurs tend to be optimistic, and in the face of bad results, there's a tendency to think, "Just a bit longer." But Barry Staw, a professor at UC Berkeley's Haas School of Business who has studied how organizations often escalate commitment to failing endeavors, warns: "Don't be the person who needs to be hit over the head with a sledgehammer. The longer you keep going, the harder it will be to withdraw--and the more money you're probably going to lose."

Nobody else thinks it's a good investment.
Would you put money into the business as it is now? Ask others for an honest answer and take the nos seriously. "You should never sit on a stock unless you're willing to put in new money for it, and the same thing goes for a business," Staw says. "Many entrepreneurs have both successes and failures under their belts. There's no point in betting your whole entrepreneurial life on a single venture."

Editor's Pick

Business News

Photos Leak of McDonald's New Space Age Spinoff Restaurant 'CosMc's'

The mega fast food chain is experimenting with a galactic-themed restaurant, drawing inspiration from an alien character featured in its 1980s commercials.

Health & Wellness

Embrace the Art of Saying No: 4 Tips for Setting Healthy Boundaries

Enforcing your own boundaries can be hard, but it's so important to master this skill. If you practice these four steps, you'll find it doesn't have to be so difficult.

Side Hustle

This Millennial Dad Just Wanted to Help His Daughter Care for Her Bearded Dragon. Then His Cricket-Breeding Side Hustle Exploded — Earning $27,000 in One Month.

It wasn't Jeff Neal's first attempt at a side gig, and before long, the "prototypical millennial side-hustler" realized his product had major potential.

Business News

Chipotle Customer Throws Food At Employee in Brawl, Judge Offers Employment Instead of Jail Time

The video of the September 5 altercation quickly went viral on Reddit.


4 Out of 5 Entrepreneurs Step Down as CEO — Here Are 3 Things You Need to Do So You're Not One of Them.

Navigating the journey from entrepreneur to CEO is a profound transformation, one that often separates visionary founders from effective business leaders.