The Pipe, Not the Pail

Most founders I know run their business well. They track metrics, manage cash flow, plan quarters in advance.

Then I ask about their personal finances. Total chaos.

No emergency fund. Lifestyle creep from last year's increase in profit. A vague hope that "the business will take care of it" when they exit. Or that the business will suddenly double and pay their increased cost of living.

And here's what I've learned - that personal chaos doesn't stay personal. It bleeds into every decision you make for the business.

How Personal Stress Shows Up in Business

At Pneuma, I was a founder in the same seat as many of you. But I had one advantage - a great job before starting the company that let me build a $50k war chest. I knew I wouldn't have to worry about money for 12 months. That buffer changed everything.

Because I wasn't above my means personally, I could commit to doing what was best for the business, not myself. The business had time to grow and mature. In return, it paid for the life I wanted.

Most founders don't start with that margin - and the stress shows up in every decision.

When your personal burn is high and your savings are thin, you start making decisions from scarcity. You cut high performers because they cost a lot, even when they're driving results. You say "I'll handle that" instead of hiring the right person, because the cash feels safer in your pocket. You become reactive, focused on keeping rather than deploying.

You become a pail - something that holds water. Static. Defensive. Waiting.

The alternative is to become a pipe - something money flows through. From you, to the business, back to you, back out again.

The Shift That Changed How I Operated

I could have exited Pneuma for $0 and still been financially free. Not because I made a fortune - but because my cost of living, investments, and savings discipline were tight. That margin gave me options. It meant I never had to take a bad deal out of desperation. It meant I could invest in the business when others were pulling back.

Margin isn't about making more. It's about keeping more. And when you keep more, you can afford to think longer-term.

Widen the gap between what you make and what you spend. Automate the discipline so it doesn't require willpower. Build a system that removes stress instead of creating it.

The Challenge

If you're running a business while your personal finances are a mess, you're playing with a handicap you don't need.

This topic presents itself in a number of ways, which is why I have the below Working Theories doc that goes into more detail.

Don’t make business harder than it needs to be. Be a pipe, not a pail.

Working Theories

Personal finance is typically an assumption of skill for business owners. If you can build a company, you can certainly manage your money... right?

Typically, wrong.

Personal finance is a different skillset altogether. Sure, there are similarities - someone will call me on that - but in my experience, being good at one doesn't mean you're good at the other. Often, it means you're not.

One requires risk. The other requires restraint.

I put together a full guide on how I think about personal finance - the systems, the order of operations, the discipline that creates margin. Link below if you want to go deeper.

Reference Document

Full List Of Working Theories Resources