Why Loyalty Can Destroy Your Startup
- Bonny Morlak
- Aug 5
- 2 min read
Six months of runway.
A spreadsheet that only goes one way.
And a founder doing everything possible to avoid the one decision that could save the company.
I've seen this more than once. Good founders. Good people. Leaders who genuinely care about their teams. The problem isn't a lack of compassion. It's confusing loyalty with leadership.
The Kindest Decision Often Feels Like the Hardest
Recently, I spoke with a founder who had six months of runway left.
He was still carrying people the business no longer needed.
Not because they weren't talented.
Not because they weren't working hard.
They were his first hires. The people who believed in the company when it was little more than an idea.
So he stretched the budget. Delayed the inevitable. Kept telling himself he'd find another way.
I told him something he didn't expect.
Holding on won't save their jobs either.
The Company Has Changed
Every startup goes through stages.
The skills that help a company survive at ten people aren't always the same skills needed at forty.
That doesn't make anyone a bad employee.
It simply means the role has evolved.
One of the hardest lessons for founders is accepting that loyalty and role fit are not the same thing.
You can deeply respect someone.
Be grateful for everything they've contributed.
Even care about them personally.
And still recognise that the company needs something different now.
Start With Growth, Not Goodbye
This isn't about cutting people the moment things get difficult.
There is an order.
Train.
Coach.
Create clarity.
Help people understand what success looks like and give them every opportunity to grow into the role.
Many people do.
Once expectations are clear and ownership is genuine, they surprise you.
Others don't.
That's not failure.
It's information.
Have the Conversation Early
When it's clear the role is no longer the right fit, don't hide behind corporate language or endless performance plans.
Be honest.
Be respectful.
Be clear.
The difficult conversation isn't what hurts people.
Months of uncertainty do.
Pretending everything is fine until the decision has already been made does far more damage than telling someone the truth with empathy.
Good leadership isn't about avoiding uncomfortable conversations.
It's about having them early enough that people still have dignity, clarity, and the opportunity to move forward.
Final Thought
Founders often believe they're protecting people by delaying difficult decisions.
In reality, they may be putting everyone at greater risk.
Leadership isn't choosing between kindness and honesty.
The best leaders understand that honesty, delivered with respect, is often the kindest thing they can offer.
What’s Next?
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