Last month I had three separate calls with founders who said nearly identical words: “We built our team for revenue that isn’t coming.”
One was an agency owner staring at a pipeline he described as “shit.” Another was an eCommerce owner who needed $400K in the next two weeks to avoid drastic cuts. The third ran an online education business with a GM hired for growth that hadn’t materialized.
All three had built their cost structures around aggressive but reasonable growth assumptions. We helped build the budget, and based on 2025 performance, all plans seemed achievable.
But something changed in 2026. Whether a new, strong competitor joining the stage, a GM not living up to the expectations or macro economic uncertainty making leads hesitant to commit.
When this reality hit, they found themselves with overhead designed for a business with a growth plan that was no longer there.
Assumptions vs Commitments
When you are making your forecasts for the next quarter or next year, it is tempting to treat them as commitments rather than assumptions. And to some extent you should. You are committing to deliver the growth the management team agrees. When you plan for 40% growth, you need to invest accordingly.
But when reality changes, you need to be agile. When you’re looking at 10% decline instead, that extra investment becomes a cash drain that accelerates the problem if you don’t act.
“We’re running a model on an assumption of growth and the revenue doesn’t come through, we’re in a shit situation because we’ve maintained on an assumption.”
Variance or Trend breach?
There’s a spectrum of responses when growth stalls. One extreme is stubborn denial. Simply ignoring the numbers and sticking to your investment plan, believing you can make it work. That’s naïve and expensive.
The other extreme is panic cutting at the first sign of variance, which makes longer-term strategy impossible. Forecasts are forecasts, the will by definition be some degree of variance.
The right response depends on whether you’re dealing with temporary variance or trend breach.
If you’re targeting 40% growth and hitting 35%, that’s probably variance. Double down, understand the root cause, treat it as a challenge to overcome.
If you’re hitting 35% consistently, that starts to look an awful lot like a trend breach.
If you’re targeting 40% growth and seeing 10% decline, that’s trend breach. Fast and decisive action becomes critical. All that overhead you built for aggressive growth will eat through your cash reserves and put you in a squeeze earlier than necessary.
Understanding the root cause is even more critical here. You will need to revise your forecasts, and become more accurate. You can only do so if you understand why you were off by so much in the first place.
The biggest risk is dragging it along, assuming you can turn it around while burning through runway that could have bought you real options.
If you’re in the agency world, I recently put together a full guide on scaling from $1M to $5M without burning out, covering the hidden financial traps. You can read it here:
TheThe CFO’s Guide to Scaling an Agency CFO’s Guide to Scaling an Agency
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