If not keen, your revenue growth can destroy a business

"Suppose one of you wants to build a tower. Won't you first sit down and estimate the cost to see if you have enough money to complete it?" (Luke 14:28).

Scaling is not growth, and revenue is vanity. If your company doubled tomorrow, would it be twice as strong or twice as exposed?

A Tugen proverb says; “a monkey (a business) so eager to see the hunter's face (revenue growth) must be prepared to meet the hunter's arrow (revenue growth's destruction).”

A matatu carrying far more passengers than seats earn its owner the best fare of the day, yet it’s one pothole from a breakdown.

The crowded matatus look like a financial success until the suspension system is damaged.

It’s the same thing in most boardrooms, sales are up, hiring is up, the founder answers midnight calls, and the applause is loud.

Yet no bank accepts applause as collateral. Every leader is placing a bet in the hope that the revenue arrives before costs.

This week's signal

Remember that, growth is a number. But scaling is a structure you survive on. Growth means getting bigger, more revenue, more customers, more work.

Scaling means building systems so output multiplies while costs, stress and dependence on the founder do not rise. You can buy growth, but you can’t buy scaling. It’s built.

Consider Nakumatt. Reports put its revenue at Sh52 billion by 2017, up from Sh40.4 billion the year before.

Reuters reported that in 2017, a cash crunch forced it to close over a dozen outlets, unable to pay suppliers and landlords.

It entered administration in January 2018, and creditors later voted to wind it up. It owed over Sh30 billion, about Sh18 billion of it to suppliers.

A rising revenue did not shield it from missing cash.

A swelling revenue feels like proof that the decisions behind it were sound. Reckless choices can produce a random good quarter.

 There’s nothing dangerous like an accidental success. It’s like doing Sh1 billion in revenue from a terrible product during global shortage.

Imagine Sh500 million at a 20 per cent margin against Sh1 billion at five per cent.

The first keeps Sh100 million; the second keeps Sh50 million, with twice the payroll.

 Stop looking at how much money you make, and start looking at how much money you actually keep.

What it means for business

Scaling is mostly the discipline of saying no to tempting expenses. Software, premises and advertising bought on next year's revenue are loans against an unsigned future. Hire to remove a named bottleneck, not to comfort a tired team.

 Never run the company from the bank balance, since that cash is already spoken for by tax, salaries and suppliers. Replace "Can we afford this?" with "Do the economics justify it?"

Before any business expansion, run a pre-mortem; assume the plan fails two years from now. Write down the possible root causes and ensure you find the cure before they go full-blown.

A business with ten customers at four percent is a safe diversified business. If one customer leaves, it only loses four percent of its revenue. Compared to a business with one customer at forty percent.

Losing money on purpose can be wise, if the leader can say why margins are thin, how long the runway lasts, and which milestone restores profit.

Never base your business budget on a good quarter. Foresight leadership is the habit of counting the cost before the revenue growth.

What it means for policy

The State is a customer, and often a late one. On June 11, 2026, Treasury Cabinet Secretary John Mbadi told Parliament that verification had found 91,911 pending bill claims worth Sh637.6 billion, and that Sh68 billion is set aside in the 2026/27 budget to begin settling them.

Every unpaid invoice is a small firm financing government. Paying on time beats any new grant.

What it means for people

Picture a finance manager who spots the cash gap months early, yet his report is filed under good news because sales are rising.

That’s a risk revenue culture. Nakumatt's administration reports listed salary arrears among its debts. That’s exactly where a vanity number finally lands.

Afterthought

We admire the biggest. Yet we should be admiring the sturdiest. Size doesn’t matter. It is the strength that keeps the business unexposed when the wind blows the anus of the chicken.

This week, put three numbers before your board: net margin, months of cash, and your largest customer's share of revenue. That is the data you need for a sustainable organic growth.

"Decisions are made on the radar screen, but the future is yours."

-The author is a human-centered strategist and leadership columnist