You built something from nothing and somewhere along the way, you became "the person who does this." Your identity fused with your company, your role, your expertise. That merger felt like commitment. It was a trap.
The sunk cost dilemma runs deeper than money or time. It's about who you've become and the terrifying question of who you'd be without it. Founders hold onto failing strategies, dead partnerships, and outdated business models not because the data supports it, but because walking away means admitting the person they built themselves into no longer fits.
Ralph Brewer has guided thousands through identity collapse and reinvention. As the founder of Help For Men and author of REBUILD, he's watched people cling to versions of themselves that stopped working years ago. His take: the fastest path forward requires burning down who you were.
The sunk cost fallacy isn't about your balance sheet. Everybody knows the textbook version: you've spent too much to walk away, so you spend more. But the version that destroys founders targets their identity. When your company becomes who you are, quitting the company means quitting yourself. A founder who built and sold six companies couldn't walk away from the seventh, even as revenue flatlined and the market sent clear signals. Not because the numbers justified staying, but because he'd never failed before and his self-image wouldn't allow it. That gap between data and identity cost him years.
Every success story follows the same script. Founder was broke, doubters circled, they pushed through one more quarter, and everything flipped. For every founder who bet their last five hundred dollars and won, a hundred thousand made the same bet and lost. Those stories don't get interviews. The survivorship bias baked into entrepreneurial culture creates a dangerous model that strips away the data points telling you the actual odds. There's no formula for knowing when grit becomes delusion. Anyone claiming otherwise is selling something.
So what can a founder actually do? Stop being a lone wolf. Blind spots are called blind spots because you can't see them, and founders sit in a power dynamic where nobody around them will volunteer the truth. The most reliable antidote is a circle of peers who've earned enough trust to say "you're being delusional" to your face. CEO roundtables and founder communities exist for exactly this reason. One founder discovered this after a divorce forced a complete rebuild. He pivoted from a marketing agency to a men's coaching platform, not because he planned it, but because someone in his circle suggested writing a book. The work aligned with who he actually was, cost almost nothing to start, and grew naturally from there. The pivot worked because he finally matched his business to his real identity instead of the one he'd been protecting.
The signal worth watching for isn't dramatic. It's the slow drain. When effort stops feeling attainable and the excitement to kick down the next door has disappeared, that's not a rough patch. That's information. Define your values before your company defines them for you, build your truth-telling circle before you need it, and treat your own optimism as data rather than direction.
Watch the Full Episode on The Sunk Cost Dilemma with expert Ralph Brewer below:
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