By the time I stopped paying myself, I’d already been running the company for six years. That detail matters, because it means the year I’m about to describe wasn’t the uncertain first year of ownership, when a founder still half-expects to fail.

It was year six of a business I understood completely, that I’d already made profitable, that I’d already started using to build a second revenue line. And it still got bad enough that I laid off part of my team, furloughed the rest, and took my own salary to zero for twelve months.

I want to sit inside that year, because most of what gets written about acquisition entrepreneurship treats the hard stretch as a single sentence. Something like “then the recession hit.” That sentence does a lot of work to protect the reader from what actually happens inside a business during a stretch like that, and I think it’s worth being honest about what the sentence is hiding.

The debt doesn’t care how competent you are

I’d bought the company with leverage. That’s not unusual, most acquisitions are financed with some combination of debt and equity, and mine was no exception.

What’s easy to forget when you’re underwriting a deal is that the loan doesn’t renegotiate itself when the world changes. The Great Recession hit while I was mid-stride. The Kindle came out. The iPad came out. Consumer reading behavior shifted in ways that had nothing to do with how well I was running the business, and the debt service stayed exactly the same size it had been the day before all of that happened.

Source: Augusta Chronicle

This is the part I think gets flattened in most retellings of hard years: it wasn’t that the business became badly run. It was that a fixed obligation met a variable reality, and the gap between the two had to be absorbed by something.

In my case, it got absorbed by three things in sequence.

Headcount: I had to lay off ten to fifteen percent of my workforce. Hours: I furloughed a portion of the remaining team rather than lose them outright.Me: I took my own salary to zero for a year.

I want to be specific about why that ordering matters. A lot of owners, understandably, try to protect their own compensation as long as possible, because they’ve got their own obligations. I made a different call, and I don’t think it was heroic, I think it was math. The debt payment wasn’t optional. My salary was the last lever left that I actually controlled.

What “never missed a payment” actually required

Here’s the sentence I say now, looking back: I never missed a debt payment. It sounds clean when I say it that way, like a badge. It wasn’t clean to live through.

Trying to keep a team motivated when everything outside your control is going sideways is genuinely one of the harder things I’ve done as an operator, and I don’t think that gets said enough in content aimed at people considering their first acquisition.

The romantic version of owning a business says you’ll face hard years and come out the other side wiser. The true version is that you’ll face hard years and have to make decisions that cost real people real income, while still showing up every day to lead a team through a stretch you can’t promise them will improve on any particular timeline.

The reason I bring this up isn’t to make the case against leverage. I’d make the same decision again. The reason I bring it up is that I think there’s a category of buyer who evaluates debt purely as a financial mechanism, a multiple of EBITDA, a monthly payment they’ve modeled against projected cash flow, and never actually runs the version of the model where the top line drops for reasons entirely outside their control.

That’s the scenario that matters. Not because it’s likely in any given year, but because if you own businesses for two decades like I have, you will eventually own one during a year like that, and the question isn’t whether your spreadsheet survives it. The question is whether you do, personally, as the person who has to make the calls about who gets paid and who doesn’t.

What actually got me through it

It wasn’t optimism. It was the seven years before that year, during which I’d built up enough equity in the business that the recession, as brutal as it was, didn’t threaten the underlying asset.

By the time I’d paid off the acquisition loan completely, I was in a position where an acquisition target came looking to buy me, instead of the other way around. That outcome existed because of decisions made years earlier, not because the hard year resolved itself gracefully.

I think that’s the actual takeaway for anyone evaluating a leveraged acquisition today. The stress test is “what happens to me, as an operator and as a person with a family and obligations, if the debt has to be serviced through a year where the business’s performance is genuinely out of my hands?”

That’s not a financial question. It’s a question about what you’re prepared to absorb, and for how long, before the thing you built starts paying you back for the years it didn’t.

Most people don’t ask themselves that question until they’re already living the answer. I’d rather someone ask it before they sign.

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