How is your company's financial health?
I crafted a financial health checklist which you can use to assess and monitor your company's financial health.
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#financialhealth
#smallbusinessfinancial
@GuyTalksFinance
Coming from someone who's been married for 16 years, have a join bank account for the household shared expenses stuff - mortgage, car payments, groceries, etc.
But you should each have your own bank accounts and credit cards for discretionary spending.
It's good to talk about
@LoganGrafTax
I don't think pricing based on avg expense is fair imo. What if a small business has few transactions but all big ticket items? Or one with lots of small ticket transactions.
Fractional CFO is not just an accountant or finance person with a fancier name.
A good fractional CFO is your right hand person with a combination of professional expertise and diversed experience, your coach and your trusted advisor.
Here's why a 13 weeks cash flow forecast is crucial for the health of the company:
- Set expectation on cash movements
- Identify challenges and opportunities that may not be present in the financial statements
- Proactive on actions based on forecast
Had a great networking chat with
@ItsMikeBraun
today.
Having the opportunities to connect with like-minded people as an entrepreneur is extremely valuable and makes this journey less lonely.
Love to connect with more people here on X.
If you love valuable finance/accounting
Is it just me, or is going to a networking event at a noisy restaurant seems to be a waste of time?
Everyone's talking over loud music and other's voices. It is impossible to have real meaningful conversations.
Telemedicine has existed for over 150 years, although it has never been a mainstream regulated path of healthcare.
Since the pandemic, it has gained significant attention, and it’s expected to have exponential growth in the coming decade.
With a promising future, the industry
Not trying to brag, but I help a new client get caught up on all of their fiscal year end lag items and identify a potential $10k savings within four days.
Friday wins!
Simple practice to improve cash flow for your business:
- Ensure timely billing to customers
- Offer incentive to customers for early payments
- Pay suppliers on time, not early
- Build a cash reserve in a flexible interest-earning account
Let's say you have $1M that you don't need to use for operations right away. You put it in a high-interest savings account at 5% interest.
That will generate over $4K interest income each month without flicking a finger.
Think about that.
Booked four United Airline tickets to Dallas. They auto assigned two seats. The other two seats we have to pay to choose and they won't be together.
Why are they like that?
You are gonna find many different types of Fractional CFO out there.
Those with a strong accounting background know how to build a strong financial foundation for your business.
Those with a strong finance background create awesome financial models and dashboards for strategic
@trentjhughes
Communicate clear deliverables and timelines. If it's a role that requires the person to be online and available regularly, then communicate the expectations early on as well.
If they can not meet the expectations and can't get work done, then maybe they are not the right fit.
📊 Understanding your financial statements is crucial. Balance sheets, income statements, and cash flow statements each tell a different story.
#FinancialLiteracy
#CFOservices
Costs are just like people. Some are more stable than others.
Fixed cost: Stable, but can have a significant impact on your bottom line. E.g. rent, payroll.
Variable costs: unstable, tied to your production, easier to adjust. E.g. labor, office supplies.
#costs
#fractionalcfo
A lot of SMB owners and CEOs don't realize how important it is to have the book closed early each month.
I've been hired into a few small organizations during my career, and one of the common themes of these companies is their books are not closed till after mid-month each
Quick tips to improve cash flow:
- Negotiate terms with suppliers to extend cash outflow
- Offer incentives to customers for early payment
- Avoid excess inventory
- Park cash reserve or excess cash in interest earning accounts.
One of the greatest thing about being an entrepreneur is that we are "forced" to learn new things FAST.
Not familiar with a particular industry? Well, you will have to learn about it fast so that you can serve clients in that niche.
Not good at sales and marketing? Well, you
@GuyTalksFinance
It's mainly for convenience. Different banks might have different perks, so you can take advantage of them. My own account also serves as my emergency fund account, which I don't have a debit card, so money goes it to be saved.
@DividendBreeder
10:30 on the weekdays, and 11:30 the latest on weekends.
My husband hasn't gone to bed before 12:30 since forever...so it really depends on the person.
I start my morning by writing down 3 things that I want to get done for the day.
I write it down on a note book and cross them out when done. There's something about writing on a notebook that get things into your brain that a digital note couldn't do.
I focus on getting the
Had my first meeting with my startup client today.
At the end of the meeting, he said something so impactful to me I can't stop thinking about it.
He said:"As a startup founder, sometimes it's lonely. It's great to have someone to talk through the financials and ideas each
@SMB_Attorney
It's exhausting to run a business with no recurring revenue IMO. unless each project is so high ticketed, it can sustain the company for a while during downtime.
Here's one of the biggest mindset changes I have made since I started my own business:
Stop thinking about myself.
Of course, time and financial freedom are my ultimate goals, but in order to get to those goals, the key is to
Think about the others.
How can I help business
Having an annual budget in place can:
- Reflect on prior year financial performance
- Plan for fixed expenses in the coming year
- Headcount planning for the coming year
- Set baseline for performance benchmarking
We are officially in August!
Where are you at your goals?
Are you still on track to reach the revenue that you wanted to reach?
Did you execute the plans that were set earlier this year?
PSA all business owners & CEOs:
You cannot make informed, sounds business decisions unless you have supporting data that is organized, accurate, and up to date!
Get your books in order! Thank you!
Which one are you:
A: "When is Liam Neeson going to stop making movies that have the same plot, just different titles?"
B: "I love how Liam Neeson still has the drive at this age to make so many movies."
One of the benefits of working with a Fractional CFO is our experience with various industries and various sizes of companies.
You are getting a highly concentrated expertise with experience dealing with different sets of financial information and solving different financial
6 Cash flow management tips that every startup founders and CEOs should know to achieve long-term growth:
1. Cash > Profit
2. Keep a close eye on your cash inflows and outflows
3. Build a cash reserve from day 1
4. Build strong relationships with your customers and suppliers
5.
Do you need SOPs (Standard Operating Procedure) for your business?
I personally have never been a big fan of SOPs.
It's rigid and it seems to dictate how employees manage their tasks. Because everyone has their own way of handling tasks and managing time, and frankly a lot of
Is your company ready to expand beyond your niche?
A company that I worked with is very well-known for a certain type of product for decades.
During COVID, they decided to tap into a market of a different product that is "outside" their niche because of higher margin and
🌱 Sustainable growth is not about seeing overnight results.
But having financial planning in place to achieve long-term goals and visions.
#SustainableGrowth
#FinancialPlanning
Pros and Cons of Zero-based budgeting for a company:
Pros:
- Focused operations
- Lower costs
- budget flexibility
Cons
- Time and resource intense
- Short-term operations focused
- Areas such as R&D may be overlooked
Tech startup founder: "We just got $2.5M investment fund. What should I do now?"
Consider these:
1. Develop a financial forecast for the next 12 months to gain insight of your burn rate.
2. Allocate the fund for the next 12 months in your operating account.
3. Park the rest of
Other people: "I become an entrepreneur so that I can do the things I love while traveling the world."
Me: I become an entrepreneur so that I can do the things that I love while being home every day.
The draw is the freedom to choose how and where you wanna do it!
Practical cost saving strategies that will boost the bottom line of your business:
1. Track your expenses: If you don't know what you spend, then you won't know what to cut.
2. Evaluate your expenses: Regular review helps you identify areas of savings without sacrificing
Your bank account is leaking money to your bank, and you know it.
We all have a love-hate relationship with our banks. You need them for your business, but they are like ticks on the bank of your neck...
A few bucks here, a few bucks there...
Bam, thousands of dollars are
How you structure your books determines how efficient your decision-making process would be.
When your company is small, your operation is simple and straightforward, and so is your book.
But as your company sacles, your operations become more complex. You have multiple
Your financial project tells you how external conditions may affect your business performance.
Your cash flow forecast tells you should act or react in order to maintain or boost that performance.
Both work hand in hand to help you make the best decisions.
LifeMD had a 67% revenue growth year over year with 90.1% gross margin and 45.6% increase in gross profit.
These numbers are blowing my mind.
Thoughts?
Earnings call: LifeMD reports strong telehealth growth, plans WorkSimpli divestiture
Misconception about Fractional CFOs:
I come in, point out all the wrong things about your financials and tell you what to do.
Wrong.
Instead:
- I help you understand what your financials tell you about the business
- I work with you to make informed decisions towards goals
@GuyTalksFinance
At the end of the day, every family is different. The right approach is the one both of you agree on and work for you. Down the road, you may need to change and adapt as your family grows.
Questions that I discuss with clients during a financial review meeting:
1. How's the net cash flow for the month (positive/negative)?
2. How was the revenue compared to what we had forecasted last month?
3. What was the cause of variance?
4. Are there any areas of
Is your company ready to hire? Here are a few things to consider:
1. Growth projection:
Is your company experiencing rapid growth? What does your pipeline look like in the next 6 months? Is this rapid growth temporary (due to one-time projects)? or will it last for at least
You don't need a complex cash flow forecast.
With a simple table in Excel, start with your bank balance, layout your upcoming cash inflow and outflow in the next three months.
Gradually add in more details as you go.
Plan and adjust spending based on the forecast.
Had a call with a new connection on LI today.
He's not looking for my service, and he is not my target client either. We just chat about each other's business and closed the call by wishing each other success.
Not every conversation needs to turn into business, but every
SMB owners, if you have consistent revenue, but not much cash left in the bank each month,
It's time to:
- Analyze your margins
- Have a detail cost audit and eliminate unnecessary expenses
- Have regularly cash flow forecast
If you haven't signed up for my newsletter, I share business tips and financial strategies 2 to 3 times a week.
Occasionally, you might see pictures of my cats too.
Here's the newsletter that's just sent out today.
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Question of the day from my 11yo:
Would you rather:
Get spitted by a Llama? Or
Fall in mud in an expensive new outfit? Or
Get licked by a bulldog non-stop?
Started with a new client today, and this is an interesting and challenging one. I do love learning about client’s businesses and discovering things that are not obvious. Fun day!
He did not get the value that he looked for (strawberry picking with the fam).
He felt ripped off.
But for others, it's a clean, nice little farm where they can enjoy the day and feed the animals. It's worth the price.
Same price, completely different ROI.
#ROI
#FathersDay
If you have multiple businesses under your belt, talk to a tax accountant and find a good bookkeeper early to build up a good legal and financial structure.
If not, the bigger they grow, the bigger the mess you will face.