In a recent LinkedIn post, Cruz Gamboa discusses a counterintuitive business challenge: how a company’s fastest-growing product can sometimes be the very thing that is draining its cash reserves. Gamboa highlights that while increased revenue and customer demand often signal success, they don’t necessarily equate to healthy financial growth or a sustainable scaling strategy.
Gamboa challenges the common business instinct to simply “sell more of it” when a product gains traction. He argues that revenue alone is an insufficient metric for evaluating the true health and scalability of a business offering. According to Gamboa, focusing solely on top-line growth can mask underlying issues that erode profitability and cash flow.
The Illusion of Revenue Growth
Cruz Gamboa points out that a product, service, customer segment, or sales channel can appear to be performing exceptionally well in terms of revenue, while simultaneously creating significant financial strain. This can manifest in several detrimental ways, as outlined by Gamboa:
- Margins can shrink
- Working capital can become trapped
- Payment cycles may stretch out
- Fulfillment processes can become more complex and costly
- Key personnel might be disproportionately occupied with supporting the high-growth item
This leads to a paradoxical situation where businesses experience “More revenue. Less cash. More stress,” a scenario Gamboa frequently observes in expanding companies.
“And suddenly you have the strange situation I see in growing companies: More revenue. Less cash. More stress.”
Shifting the Focus from Revenue to Value
The core of Gamboa’s argument is a call to redefine the key performance indicators for business growth. He posits that the critical question for leaders should not be about what is selling the most, but rather about what generates the most economic value relative to the resources it consumes.
As Cruz Gamboa explains:
“The question isn’t: ‘What’s selling the most?’ It’s: ‘What creates the most economic value for the resources it consumes?’
This fundamental shift in perspective, Gamboa suggests, is crucial for identifying and addressing “profit leaks” that can undermine a company’s financial stability, even amidst apparent success.
Identifying and Fixing Profit Leaks
To help businesses tackle this issue, Gamboa introduced a framework within his LinkedIn post designed to assist entrepreneurs in analyzing their own operations. While the details of the framework were presented visually within the post (requiring a swipe-through), the underlying principle is to move beyond superficial revenue metrics. Gamboa encourages a deeper dive into the true costs and resource commitments associated with each business line.
In Gamboa’s view, understanding the economic value generated per unit of resource consumed is paramount. This analytical approach allows businesses to make more informed decisions about where to invest resources, which products to prioritize for scaling, and how to optimize operations for genuine, sustainable profitability rather than just top-line expansion.
“That’s a very different question.”
For those seeking further guidance, Gamboa offered to share a “Profit Leak Finder” tool via direct message, underscoring his commitment to helping businesses achieve healthier financial growth.
📝 About This Content
This article is based on insights shared by Cruz Gamboa on LinkedIn.
📅 Originally posted on October 1, 2026 | View original post on LinkedIn →