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# Profit is a dirty word

**James Walls** · August 25, 2026 · 8 min read

Three weeks ago Kristina and I leased a new car – a Volkswagen Tiguan, a great little car. This wasn’t our first rodeo though – we’ve bought and leased many cars over the years.

So, we did the homework long before we set foot on the lot – where a dealer’s money really sits, how much of any opening offer exists purely to be negotiated away – and we knew where we wanted the deal to end up before anyone shook hands. After a decent amount of back and forth, we got to what we consider a good deal.

What I hadn’t expected was what came after the handshake. Their finance manager (a towering Scotsman with a fantastic accent and a magnificent beard) went through the numbers with us and showed us where the dealership had ended up: on the car itself, they ended about two thousand dollars down. He wasn’t sore about it and he wasn’t fishing for sympathy. They had told us at the start that they were a volume dealer, and it turns out that isn’t a euphemism for thin margins and optimism – the car goes out at a loss, deliberately, because what pays is the servicing that follows it over the years, a good part of which, he said, Volkswagen covers. The car is the loss leader. The service department is the business.

And we hadn’t caught them out by pushing hard on the price, either. Their people had known where that number would end up before we ever started, and he was entirely comfortable with it.

I’ve been thinking about that conversation ever since. Here was a man telling a customer, to his face, that his business fully intended to make money out of the relationship – just not on the car, and not this month. He wasn’t dressing it up and he wasn’t apologizing for it. When did that become unusual?

## Not bad arithmetic

Because it is unusual. The owners we sit with are not bad at making money, and they are not kidding themselves about volume – most can do the sums perfectly well. What has happened is quieter than bad arithmetic. Profit has stopped being something they aim at and become something that either happens at the end of the year or doesn’t, and for a good number of them it has picked up a faint smell of self-interest, as though a business making good money must be making it at somebody else’s expense. Less a target than an accusation.

Some of that we’ve been taught by watching from a distance. SpaceX is valued somewhere north of a trillion dollars and lost close to five billion of them last year, on revenue of eighteen and a half. Amazon was unprofitable for years after it listed and is now one of the most valuable companies on earth. Hear enough of that and you reasonably conclude that profit is something you get to later, and that the real game is growth, or scale, or share of the market.

## What Amazon and SpaceX actually do

Those examples are misread. In that same year, Starlink – the satellite arm inside SpaceX, twelve million subscribers paying about sixty-six dollars a month – earned something like four and a half billion dollars of operating profit on its own, and the group still lost five. What Starlink makes is being poured into the parts of the company that make nothing yet. Amazon spent everything it earned and more on growth, expensing it as it went, so the reported profit stayed near zero while the company was ruthless about the economics of every single unit it sold. Neither company is indifferent to profit. Both know precisely which part of the business pays and which part is being paid for – which is the dealership’s arrangement with several more zeroes on it.

What doesn’t transfer is the funding underneath it. When a company isn’t being valued on fundamentals like profit, it’s being valued on sentiment – on potential – and sentiment will carry a business for as long as investors are willing to make up the difference between what it spends and what it earns. SpaceX raised twenty-six billion dollars in a single year doing exactly that. A business turning over three or five or fifteen million has nobody making up anything: what it invests next year comes out of what it earned this year, or it simply doesn’t happen.

For us mere mortals, potential and five dollars will still only get you one cup of coffee. Sooner or later, the chickens will come home to roost.

## Add value, or destroy it

That is the respectable half of it. The other half has nothing to do with valuations at all.

So is it also that profit is seen as exploitative? Distasteful, even? That an owner focused on it is a miser – underpaying the staff, squeezing the suppliers, taking more than their share out of the community they trade in? I think it is close to that, and I think it comes from the same place as hearing the word “budget” as a constraint, a thing that stops you doing what you want, rather than as a focus tool for meeting an aim.

I was taught something different, and I’ve never found a reason to abandon it. Not in a boardroom, either, and not on any course I paid for – in basic economics, at high school. The aim of any business, any endeavor, is to add value – as opposed to destroying it.

Profit is simply *the numeric expression of value*.

That isn’t a sophisticated position. It is the foundational one, the first thing anybody is told about why businesses exist at all – and somewhere between a high school classroom and here, a good many of us have quietly stopped believing it.

When a business earns a positive return on the money, the materials, and the hours that went into it, value has been added, and the number tells you how much.

Which is why the business making no profit is not the virtuous one in the room. It can’t pay above the market (or at the market in many cases), can’t invest in the people who work there, and can’t survive a bad year without a supplier waiting longer for payment or the owner putting their own money back in. And a loss is not a neutral outcome, whatever modesty we dress it in; it is value being destroyed – the money that went in, the work that could have come next, and eventually the jobs the business was holding up. The damage arrives more slowly than the miser’s, and more quietly, which is the only reason it passes for restraint.

A miser isn’t made by caring about profit, either. A miser is made by not caring where the profit came from – what it cost, and who or what was exploited to produce it – and then by caring only about the accumulation itself, rather than what any of it is for.

## Profit IS the vehicle

Very few people got into business purely to make money. They got into it to build something, or to be their own boss, or to do the work properly for once, or to prove themselves, or to look after the people who depend on them. Profit is not a rival to any of that. It is what makes it possible, and then what lets it reach past the handful of people you could look after out of your own pocket.

If your aim is to help people, a million dollars of help will reach vastly more of them than one dollar will.

Which is what the discomfort actually costs. If the word makes you uneasy, you don’t look at it very closely – and the number you don’t look at is the one quietly deciding what the business can do next, who you can hire, and what you can pay them.

That finance manager told us where the dealership was going to make its money, and roughly when, and he was just as plain about what it was costing them to get there. Nowhere in any of it was there a suggestion that intending to make money was something he ought to be embarrassed about. That is what it looks like when profit isn’t a dirty word.

## Steering the (space)ship

If any of this lands, the practical question is whether you can see the thing you would be steering by. Most owners can see the bank balance and last year’s accounts. Rather fewer can see which clients and which services are actually carrying the margin, or what next quarter’s cash looks like while there is still time to do something about it – and if you can’t see it, you end up running the finances on instinct, which is a fine way to start a business and a poor way to grow one.

There is a short scorecard on our site that asks exactly that, in seven questions: whether you can see the margin underneath the revenue, whether the cash forecast reaches far enough ahead to be useful, and whether the numbers and the plan are pointed at the same place. It takes about two minutes, and at the end it tells you whether the business is being run on instinct, on insight, or on outcomes, and which gap is worth closing first. There’s no email to hand over, nothing to sign up for, and nothing you answer is stored anywhere – it’s meant to be useful whether we ever speak or not.

**Forecast.** A forward view of what the numbers will do, built from what the business knows now – work already won, work likely to be won, costs already committed, and the timing of both. [Full entry →](https://stoneforgegroup.com/glossary/#forecast)

## Two questions to sit with

- If profit is the vehicle, what is the destination – and have you ever said it out loud to the people who work for you?

- Which parts of what you do actually earn you money – and how sure are you of the answer?

### See how your own numbers are being run

Seven quick questions, a gut answer to each – no email asked for, nothing you answer is saved. Useful whether or not we ever speak.

[See Where You Sit →](https://stoneforgegroup.com/financial-scorecard/)

Sense it’s the selling rather than the numbers? [The 30-second test sorts it →](https://stoneforgegroup.com/where-its-stuck/)

First published in The Stoneforge Newsletter on [LinkedIn](https://www.linkedin.com/pulse/profit-dirty-word-james-walls-442ze), August 25, 2026.

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