Ep. 99 - CFO Advice Every Founder Should Hear

When does a small business need financial expertise beyond basic bookkeeping? Danielle Hendon, Founder and CEO of 4 Corners CFO, reveals the critical moment most entrepreneurs miss: "You don't want to be responsible for somebody else's payroll and livelihood if you have no idea where your business is going."

After transitioning from music to accounting and spending a decade in corporate oil and gas, Danielle now helps small businesses implement financial strategies typically reserved for larger companies. She draws a clear distinction between backward-looking bookkeeping and forward-looking financial guidance that small businesses desperately need but rarely have.

The conversation explores why most small businesses operate without budgets or cash flow forecasts, despite these being essential tools for growth. Danielle explains how proper financial management gives entrepreneurs the confidence to make strategic decisions based on data rather than gut feeling alone, particularly when considering hiring employees, expanding services, or planning an eventual exit.

For those building a business rather than just creating a job for themselves, Danielle offers practical insights on emergency funds (ideally 3-6 months of essential expenses), categorizing expenses strategically, and understanding the true profitability of different revenue streams. She emphasizes that entrepreneurs should know exactly what their numbers are telling them before making significant business moves.

Whether you're just starting out or looking to scale your established small business, this episode provides a masterclass in financial clarity without the accounting jargon. You'll discover when it's time to bring in financial expertise and how a fractional CFO can help transform your business from surviving to thriving.

Episode Transcript

Speaker 1 (00:00):
Yeah, I mean, you don't want to be responsible for
somebody else's payroll andlivelihood if you have no idea
where your business is going.

Speaker 2 (00:07):
I think I agree that's a really interesting.
I've never had that triggerpoint explained like that.

Speaker 3 (00:14):
That's a big deal.
But she just said to you whenyou go past the point of taking
care of yourself and you'regoing to have to start taking
care of other folks, right, it'sthe stakes get high and you're
going to have to start takingcare of other folks, right.

Speaker 2 (00:28):
The stakes get high.
Hey everybody, we're back againwith another episode of Big
Talk About Small Business, smallBusinesses.
I'm here in the studio with mygood buddy and partner in this
affair, eric Howerton.
You know I was really hangrywhen I was coming in here.

(00:51):
I had to stop and get anenormous chocolate chip cookie,
or I would have really not beengood today.

Speaker 3 (00:55):
You know what's crazy is?
I was hangry too, but I got melike a sausage egg bagel.
But you got a cookie I did.
Yeah, where did you get acookie Right there at the coffee
shop.

Speaker 2 (01:09):
Oh, you went next door and got you a chocolate
chip cookie.
Yeah, I saw you in theretalking to some old guy.

Speaker 3 (01:16):
That's not good for you to get a chocolate chip
cookie like that and just havethat on your stomach.

Speaker 2 (01:23):
That's my lunch, man, that's my breakfast in my life.
So, hey, power to you.
We've got a guest we betterintroduce.
Yeah, right, uh, daniellehendon is with us.
Um, she is, uh, the founder offour corners cfo, which is a
company that provides fractionalCFO services to small

(01:46):
businesses.
She's based in Houston, whichis the epicenter of everything.
I guess you got the biggestKaty Freeway is always whenever
I think of Houston, I think ofbeing on the Katy Freeway 28
lanes, 28 lanes.
Yeah, it's huge Really.

(02:07):
It is a case study of build itand they will come.
Oh, and they come becausethere's traffic they come, it's
the widest, and every time theykept expanding it, just more
traffic flows to it.
So it doesn't solve the problem.

Speaker 3 (02:22):
I've never even heard of this in my entire life life.

Speaker 2 (02:24):
well, eric, you got to get out more bud 28 lanes yep
, that's right.

Speaker 1 (02:29):
14 in either direction and and I'm sure
danielle wants to talk aboutthat today instead of accounting
hey, houston traffic could be awhole topic of its own, because
I live here and I will admit weare not the best drivers.

Speaker 3 (02:45):
Oh, right yeah.

Speaker 1 (02:47):
We're a little aggressive on the freeway, but
you are.

Speaker 3 (02:49):
You're an excellent driver, it's just everyone else
right, I just stay off thefreeway.

Speaker 1 (02:52):
That's why I work from home.

Speaker 2 (02:54):
You're right.
One of the companies I used towork for had an office in
Houston and their Houstonpartner would like go through
toll booths at 100 miles an hour.

Speaker 1 (03:04):
I mean, it was absolutely if you're doing the
speed limit, you better be inthe slow lane regular occurrence
I mean not like yeah anyway, Ilike that, though things are
moving fast down there yes, man,big it bill, building it big,
exactly.

Speaker 3 (03:19):
Get your stuff out, get it down.
No, slowing down, no, not atall.
If you're in the way, if you'regoing slow, get out of the way.
Yes, yes, all those wonderfulthings about business, right?

Speaker 2 (03:30):
So tell us a little bit about your business and how
you got into this thing,Danielle.

Speaker 1 (03:40):
Oh gosh, I love telling people that I actually
started as a music major.
I didn't think that I was goingto be an accountant, but we had
.
I had an English professor andwe wrote an essay all about our
career path and I realized veryquickly that I didn't have
friends in high places and I wasgoing to be really broke.
So I decided that I did havefriends in the business school
and accounting sounded fun andthere's this weird connection
between numbers and music and itjust it fit.

(04:03):
I've loved every bit of it.
Hindsight 2020,.
My family and friends are likeI don't know why.
You didn't know that's what youwere supposed to do.
Did my master's, got my CPA,went the traditional route with
public accounting, started afamily and realized I didn't
want to work 60 hour weeks witha newborn at home.
So I left public and, being inHouston, I landed in oil and gas

(04:27):
for about a decade, where thecompany I was with ended up
going through bankruptcy whenall the prices tanked back in.
What was that?
18.
And anyways, prices tankedbankruptcy.
Bankers were selling everythingoff.
It took about two years, butwhen the pandemic hit, it was
really obvious the doors weregoing to close and it was also a

(04:50):
bit of a silver lining andperspective shift for me.
We were in the process of hiringa nanny to get the kids to all
the things, because that's whatyou do in corporate when you're
climbing the ladder and I wasnow at home with my kids, trying
to teach them and figure outwho the teachers were and the
friends and the parents and thecoaches and all of these things,

(05:12):
and I realized there was thiswhole other side of parenting
that I was missing out on and Ididn't want to anymore.
I wanted to find a way to dowhat I love because call me
weird I love what I do as anaccountant, but also be there
for my family and the peoplethat I love.
So I started Four Corners CFOin order to bring those big

(05:32):
business concepts when it comesto budget and analytics and the
things that make big businessbigger to small businesses in a
way that fits their budget,that's fractional and also makes
sense to them, so that they canuse it and understand the story
that their numbers are tellingand build livelihoods and
legacies.
And honestly, it just feelsreally cool to get to be a

(05:52):
pebble in the pond and watch theripples of all the people we're
helping.

Speaker 3 (05:56):
That's a cool story, you know.
I think that for our audience,let's demystify this fractional
CFO, if we can Like.
I mean, it's a term that's kindof it sounds really cool,
doesn't it?
Yeah, no, it sounds so awesome,but what does it really mean to
the small business owner, right?
Why is that valued A lot of?

Speaker 1 (06:12):
people get confused because when you see I am a CPA
and most people think accountant, and when you think accountant
you think taxes or you thinkbookkeeping.
And what we do is actually nottaxes or bookkeeping.
We don't touch either.
We focus on, as fractional CFOs, what would be more of that
operational accountingperspective where you're looking

(06:33):
at building budgets and how dothose budgets compare to your
actuals and what's the forwardlooking future component of your
business.
Your bookkeepers, your taxpreparers, their really good tax
strategy which I hope all ofyou have are usually looking
hindsight.
They're looking at the past,they're categorizing and they're
trying to do what they can tominimize the taxes for things
you've already done.

(06:53):
As a fractional CFO, it's ourjob to come in and help you
understand the numbers so thatyou have the confidence and the
peace of mind to take that nextstep in your business.
As a business owner myself,you've always got that gut
instinct and a lot of people flyby it and they don't even look
at the numbers and they just goby gut and they keep moving and

(07:14):
it can work for a while.
It works until it doesn't.
But we want you to have thatgut instinct and then go no, I
can really do.
I can hire that person becausethe numbers say it's okay.

Speaker 3 (07:26):
Sure.
So if we look at this, like ifwe said, okay, a CFO for a
bigger company that can afford aCFO full time, yeah, that's,
their job internally is to dothe budget planning, to set
pricing's a big deal I'm sureLike, does it make sense?
And payroll costs, capitalstructure Capital structure
Capital structure right, is thisbusiness?

(07:47):
Yeah, borrowing All that stuff.

Speaker 1 (07:50):
And exit planning.
If you want to get out one day,you've got to know how to make
sure that you can do that.

Speaker 3 (07:55):
So all that stuff is CFO territory, right?
And so I think for a smallbusiness owner like you
mentioned too, danielle likethat CFO doesn't mean they're
preparing your taxes, it doesn'tmean that they're doing your
books, it means that they're astrategic part of the company.
That's, that's looking at thenumbers to make sure that this
stuff all makes senseoperationally.

(08:16):
And then, but the fractionalpart, right, just for clarity is
for small businesses thatcannot afford a full-time CFO to
have that part.
The fractional is representingthat your business, basically,
is doing a portion of that workfor them.

Speaker 1 (08:34):
Yes and no, I would argue we do all of that work,
but because they're a smallbusiness, they don't need a
full-time person doing it.
It can be done in a fraction ofthe time that a corporation
might need.
So we can serve multiple people.
But at least for us, in the waythat we do it, our clients have
access to us.
I don't want to say 24 sevenduring business hours, but they

(08:57):
have access to me and my team.
If they've got questions, we dothe coordinating with the
bookkeeper and the tax preparer.
We help them step out of thatpiece and know just enough of
the finances to move forward butnot have to be in the weeds of
it.

Speaker 3 (09:10):
Yeah, yeah, so they still.
I'm sorry, mark, I'm hijacking.
No, go ahead.
Every time I say something, youlook like you're pissed at me.
No, I'm not, okay, cool.
So if we were working with you,Danielle, we would still need a
bookkeeper because you're notgoing to do that, and I still
need my tax preparer for the endof the year.

(09:32):
All right, so, because you juststay in that lane.
But I think that's reallyimportant, because I've been in
small business for a long timeand I never understood that I
would just hire a CPA as fortaxes, and I think that they're
supposed to help me with thestrategy.
And I'm so freaking frustratedbecause I'm like why didn't you
say that two years ago, exactly,if I'm losing so badly, why

(09:57):
didn't you tell me to?
Oh well, I mean, it's neveranybody's fault.
Yeah, I hear you.

Speaker 1 (10:02):
And it's one of the first questions we ask new
clients.
We ask them to introduce us totheir bookkeeper and their tax
preparer.
And then I say do you havestrategy meetings with your tax
preparer?
Because if not, we need aswitch.

Speaker 2 (10:13):
Yeah, it's true.
Well, I think the other thing,the whole idea with the
fractional CFO stuff too is youcould go hire somebody and call
them a CFO, but you're not goingto necessarily get the same
quality.
You want a full-time person ata price, or do you want a part
of somebody who's better at thesame price?

(10:35):
It's kind of the way I look atit.
I mean, I've done this rolemyself.
I'm doing it right now in acompany.
Now, unfortunately, I don'tknow what your experience has
been, danielle, but don't youfind that sometimes you can't
really do the CFO job becausethe accounting is so bad that it
forces you into the weeds?

(10:57):
And that's certainly what I'veencountered?
You know things like revenuerecognition.

Speaker 1 (11:03):
We get a lot of back and forth with the bookkeepers
to make sure that the numbersare good, but we go through a
very structured framework whenwe onboard a new client.
And the very first thing we dois their balance sheet Cause if.
I can't, as an accountant,reconcile your balance sheet and
, for those of you listening,that is not the same as
QuickBooks saying it'sreconciled.
If it doesn't make sense andit's not reconciled properly,

(11:26):
that's the first place we haveto start.
I'm not going to touch your P&Lwith a 10-foot pole.

Speaker 3 (11:31):
I like that.
Why is that?
Explain it to us folks thatdon't understand all this stuff,
please.

Speaker 1 (11:37):
The easiest one to give is your bank account, and
I'm dating myself a little bit.
It's kind of like balancing acheckbook back in the day of
like you may have money in thebank that you already spent and
that's the purpose of areconciliation between the books
and the bank account, andQuickBooks will do that.
It'll match, it'll look forwhat's different and then it
gives you this list ofoutstanding items.
A really good bookkeeper isgoing to make sure that list of

(12:00):
outstanding items makes sense,that you don't have a check from
two years ago sitting in thatlist.
A not so good bookkeeper isgoing to say oh, they're
reconciled numbers match.
You've got this list, we'regreat, let's keep going and
we're going to say time out, wegot to back up.
What is this?
Another really good example thatI love to give is the balance
sheet is a place where a lot ofaccountants will put what we

(12:22):
call clearing accounts.
So something that just needslike a placeholder payroll is a
great example.
If you have people on payrolland you're doing 401k payments
and as part of their payrollthey're contributing to the 401k
, that's going to go sit in aclearing account because it
hasn't actually been paid out tothe 401k company, yet it hasn't
hit your cash.

(12:42):
But people will use thatclearing account incorrectly and
it'll steadily grow and growand grow and I'm like wait,
where's the offset?
Something got booked wrong here.

Speaker 2 (12:52):
How about inventories ?
I mean, I got involved with acompany and a couple of years
ago I looked at their balancesheets and they had the same
value for two differentinventory accounts over three
years.
Okay, now that's a red flag,isn't it?
It's like what are the odds?

Speaker 1 (13:11):
Because the inventory assets that have never recorded
depreciation because thebookkeeper didn't talk.

Speaker 2 (13:19):
Yeah, I mean.
So, yeah, the inventories Ifind are a big problem, the work
in progress, I mean, I'm sure alot of these little companies
you work with, professionalservices firms, I noticed I was
going to say I'll be honest.

Speaker 1 (13:31):
We avoid the inventory unless they're a trade
that has very small amounts ofit.

Speaker 2 (13:38):
I don't really care much about that, but you still
have unbilled whip, you do?
You have a lot of unbilled time.
Yeah, unbilled whip you do.
You have a lot of unbilled time.
Yeah, that unbilled work inprogress.
So you're a service firm.
You do the work, but youhaven't sent a bill out yet.

Speaker 1 (13:53):
That's really an asset you want to begin to talk
unbilled and accruals if youhaven't walked them through,
actually cleaning up the booksfirst, If they're not billing
well, to begin with and I willgive we do a lot of law firms.
One of my favorite examples ina law firm you have what they
call a trust account which isbasically like the escrow, the

(14:15):
retainers you haven't actuallyearned it yet.
Law firms love them, but theycan be notorious for moving
money because they know they'veearned it but they didn't
actually take the time to go putit in their practice management
system.
And now the books are a totalmess and nothing ties.
That makes a lot of sense, butuntil I clean that up, we can't
begin to talk about your unbuilt.
I need to fix your build first.

Speaker 2 (14:33):
Yeah, yeah.
So there's a lot of problems.
How do you explain to thesesmall business owners the
difference in things like cashand accrual, because I've found
that's very difficult for somepeople to understand, even
though you can tell them look,cash is like your checkbook what
came in and what goes out inaccrual is when you earned it,

(14:54):
but they just it's like a lot ofsmall business owners just
simply cannot understand accrual.
Do you find that to be the caseand how do you help them?

Speaker 1 (15:05):
Absolutely the case, and my initial gut answer to you
is I don't explain it.
But second to that is we talkabout it in different ways.
I don't talk about cash.

Speaker 3 (15:15):
Sorry, that was an awesome answer.

Speaker 1 (15:20):
We don't, because, similarly, I don't talk about
cost to get sold, I talk aboutrevenue generating costs.
I want it to be in languagethat they understand and
recognize.
So I'm not going to say cashversus accrual, because that
doesn't mean anything, but whatdoes make sense.
And I'm going to use law firmsagain as the example.
Sure.
When you get paid it hits yourbank account and we're going to
have a cash forecast that'sgoing to show you when we think

(15:42):
things are going to hit yourbank account and it's going to
be based on your budget.
But your budget needs to showme what's happening in real time
Because if your team and backto your unbilled piece if your
team put in 100 hours and wethink there's only $20,000 of
revenue or whatever, if it's nothitting the target that that
100 hours should, we need tohave a conversation.

(16:03):
But if I don't know how muchactual time and actual revenue
and we don't have that revenuematching component in the same
month, we can't begin to havethat conversation and that's why
we need to book these accruals.

Speaker 2 (16:18):
Yeah, I'm glad you brought up cash flow forecasting
, I mean.
So I know you specialize inthese companies that do like
less than a million bucks a yearor whatever, right.

Speaker 1 (16:27):
Usually we have a couple that are up in 10 and 15,
but not very many.

Speaker 2 (16:31):
Okay, so whatever let's even say 10 or 15 million
how many of these companies,when you go to help them the
first time, if you found that,have any kind of cash flow
forecasting whatsoever?

Speaker 1 (16:47):
They don't usually even have a budget.

Speaker 2 (16:49):
Let alone a cash flow forecast.
There you go.
So I mean again.
I mean, I don't know what yourexperience is, but I'm just
going to go back to my own,working as a fractional CFO in a
company I also happen to havesome ownership in the cash flow.
Forecasting was non-existent.

(17:09):
We update it throughout the day, every single day, and it's the
most critical tool that we have.
I don't know what else to sayother than my experience is, at
most, all these small companies.
They don't do it and I don'tunderstand why.
Is it because they've got somuch?

Speaker 1 (17:29):
needed at that level, Like we're not do.
I will be honest we don't dodaily cash flow for any of our
clients.
We have a couple of thoselarger ones that we're looking
at it weekly to make sure thatpayroll and billing goes out on
time.

Speaker 2 (17:40):
Right.

Speaker 1 (17:41):
But the majority.
If you're in that kind of 250to a million space, we're
usually doing it monthly, butyou need to know when you expect
that cash is king.
If you run out of cash, youdon't have a solution for it.
I mean, unless and one of thevery first things I tell clients
is I'm a huge fan of a line ofcredit you need to have a safety

(18:02):
net and if it's not your ownsavings, then we need to find
one.
But you don't want to always bereaching into that, and if you
don't know where cash is gonnago, we've got big problems you
know what I love?

Speaker 3 (18:14):
what's that?
I love being the dumbest person.
Oh, come on.
No, I mean for real.
You guys are going back andforth, I mean talking about all
these things that are just likescientists.
But I'm here to represent ourlisteners because, like well, I
mean like you brought up thecash flow, like why?

Speaker 1 (18:34):
don't they.
Are you going to ask us what acash flow forecast is?

Speaker 3 (18:37):
no, no, I'm not, I'm not going to ask that, but I'm
going to say, hey, like as anlike, like.
The reason I didn't have thatand the only thing that was in
my brain as entrepreneur wasnothing other than making a deal
, getting revenue, getting asale, getting a sale.

Speaker 1 (18:56):
I bet you looked at your bank account at least once
a week, if not every day.

Speaker 2 (19:00):
He managed his cash very, very tight, was super
undercapitalized, okay for along time, and that teaches you
to be.

Speaker 1 (19:10):
Even my clients without a budget are at least
checking their bank account Likeif it's in the bank I've got it
.
May not always be true, but atleast they're looking.

Speaker 3 (19:18):
I'm telling you, man, I'm the worst, like I am the
worst, I really am.
Why don't you get me help inyour business?
Because you will.
I'm embarrassed and I'm scared,get down.

Speaker 1 (19:30):
That is a very real thing, though.
Okay, people would rather sticktheir head in the sand.
Yeah, fly by gut.
Then feel embarrassed orashamed of what their numbers
are there is absolutely a hugemindset piece that's exactly
right.

Speaker 2 (19:44):
I am be embarrassed or ashamed.
I mean listen, it really isn'tno accountants that enjoy this.

Speaker 1 (19:47):
It's like putting together a puzzle.
What you see is messy andembarrassing.
We're like, oh, this is so muchvalue we can add if I do this.
So accountants that enjoy this.
It's like putting together apuzzle, what you see as messy
and embarrassing.
We're like, oh, this is so muchvalue we can add If I do this.
I can do these two littlethings and you're going to see
so much.

Speaker 3 (20:01):
So here's my thing, though I mean I think this is a
good combo, because the realityis is no, I don't look at my
bank account.
No, I don't look at the books.
As a matter of fact, my entiretown, at my previous company
that we built, I never looked atthe books, I never looked at
the bank account.
I had no idea.

(20:23):
God love you, how's thebusiness?

Speaker 1 (20:25):
doing yeah.

Speaker 3 (20:30):
That ended up doing pretty good.

Speaker 1 (20:32):
No, I mean, how did you gauge it?
How do you measure it?
How did you get check, pulsecheck, feel for?

Speaker 3 (20:38):
Making deals, man Just making deals.
If I would sign another deal,then I would go back and we
would hire somebody and I'd justunderstand the people out of
capacity and can we hire?
And so, to answer, I had abusiness partner.
My business partners wouldalways be on that side.
Somebody's looking at it,somebody's looking at it, but I
was never looking at it.

Speaker 2 (20:58):
Well, when you had it all by yourself before you
brought that business partner in, what you were doing is you're
going oh, I don't have enoughmoney.
Therefore, I'm not going totake anything out.
I'm going to kick money out ofthis thing, right, 100%.
I had self-sacrifice, yeah,total.
So I mean total, utterself-sacrifice.

Speaker 3 (21:16):
You you were looking at it and then just calling,
getting on the phone, calling,meet and meet and meet and it's
all about revenue.

Speaker 1 (21:23):
But I mean, I think that that's a statement about
revenue and you could have livedlife easier oh, I'm sure I
could have.

Speaker 2 (21:31):
I mean, I think too, though a lot of it depends on,
like, how capitalized thecompany is, cause I've also, you
know, as you say, professionalservice firms.
I worked with architects andengineers my entire career, yeah
, and that's a long one.
And I remember there were likean architect in Connecticut who
had his entire revenue he neededfor the year in cash in the

(21:55):
bank.
He's like a 70 year old dude.
Okay, that guy didn't careabout his accounting at all.
It's like they'd send bills outevery three months if they felt
like it because they just wereso overcapitalized.
Yeah, they were just flat outovercapitalized and it just

(22:15):
takes all the.
I'm used to operating on theother basis, like payrolls
Thursday how much money have wegot?
Where can I get another 20grand?
I mean it's you know it's adifferent thing.
I think when you've got areally undercapitalized company,
the financial management stuffthat you're talking about doing,
it gets even more critical thatit's done.

Speaker 1 (22:37):
How really fun when they've got a lot of cash,
because then we get to connectthem with wealth manager and it
becomes like okay, so let'sfigure out how to make this tax
efficient.
And do we want to go buy realestate for the office instead of
renting?
And how do we make more moneyfor you out of this?
Not just sitting in a bankaccount doing nothing Because I
can't I'm a huge proponent ofemergency funds and line of

(22:58):
credits and having safety netsbut sitting there doing nothing.

Speaker 2 (23:06):
No, thank you.
It's crazy, it really is.
Are resistant to take money outof their business and, let's
say, put it in the stock marketor other things that maybe are
considered safer, because theyfeel like they don't have
control over it, like they dotheir own business.

Speaker 1 (23:24):
I absolutely, and I think part of it, part of it is
that a lot of small businesses.
We know we can budget andforecast all we want, but if the
world has shown us anything inthe last four years, five years
since I started this, it's thatyou're going to get hit with
something you never saw comingevery year.
And.
I think there's that what if?

(23:44):
What if we get hit with thisthing and then we lose clients
or we need money and they wantto make sure that it's still
there.
We lose clients or we needmoney or we need and they want
to make sure that it's stillthere.
But I think that's why it'simportant, when we have that
emergency fund conversation, tosay, okay, let's put that
somewhere safe when we're beyondlike a three to six month
emergency fund and when I saythat I don't mean all of your

(24:05):
money, because let's be real, ifyour business is tanking,
you're not keeping all of yourpeople, but a three to six month
emergency fund then we reallywant to say what makes this cash
effective and efficient for you?
How do we put it in a placethat doesn't just benefit the
business but benefits you?

Speaker 3 (24:21):
so three months.

Speaker 1 (24:22):
So your emergency fund is three to six months of
what like the total overalloperating cost of the business
we go through an exercise withour clients where we actually
talk about if all hell breakloose, what do you absolutely
need to keep this businessrunning?
What keeps the lights on?
If it's a revenue generatingcost and they're not generating
revenue, are you really stillkeeping them so that we can come

(24:45):
down to what's a realisticnumber along with?
We all know it costs money tohire people.
How long would you want to keepsomebody and give you time to
pivot and adapt before you say,ok, we're going to have to do
some layoffs, because as abusiness owner, that's one of
the last things we all want todo.
You know you're responsible forother people's livelihoods and
that feels like crud to do alayoff.

(25:06):
But if they're not generatingrevenue, then we can't keep
paying them.

Speaker 2 (25:12):
Yeah, yeah, what.
How do you feel about open bookmanagement?
Do you ever advocate that orput that in place in some of the
companies that you work with?
Oh, I haven't heard of that.
Okay, that's basically sharingfirm financial performance
metrics with every singleemployee in the company.
Like one of the companies Iwork with, we share everything

(25:32):
Cash accrual, how much cash isin the bank, sales web hits, all
that stuff.
How do you feel about that?

Speaker 1 (25:40):
I think there is a ramp up to it.
I think for a lot of thebusinesses that come to us when
they're first starting out anddon't have budgets or any they
don't even have KPIs Our firststep is to identify those KPIs
and figure out who's responsiblefor them, because all of those
primarily administrative,non-revenue generating people

(26:00):
should be revenue affiliated andhave a KPI and they need to
know what that is first and wewant to make sure we're
incentivizing it.
They know what it is andthey've got access to what that
number is as you grow.
I definitely think that openbook management helps the firm
as a whole come together andbuild a better team and build a
better firm and have a reallygreat culture.

(26:22):
But I think you have to lead upto it, otherwise it's
information overload.
I have clients that'll get onand I'll open Excel and I just
watch them go blank get on andI'll open Excel and I just watch
them go blank.

Speaker 2 (26:34):
So I love that.
She said revenue affiliation Isthat what you said?
Did I catch that right?

Speaker 1 (26:44):
I'm telling you, I'm all about the non-accounting
terms, if you hear me say anaccounting term.

Speaker 2 (26:46):
it'd be really rare.
So it's like what you're sayingis you got to justify your
existence here some way?
It's basically revenueaffiliation.

Speaker 1 (26:54):
There is nobody on the payroll or in your operating
expenses.
That is not either requiredrevenue generating a personal
part, like my kids on payroll,or an investment in the business
, and everybody and everythingthat's an investment needs to
return time, money or both.

Speaker 2 (27:11):
Yeah, I agree, I like that.
How do you get people to thinklike that though?

Speaker 1 (27:18):
So when we go through the budget, the onboarding
process to their budget building, step one is the balance sheet.
Step two is revenue streams.
We look at most of our clientscome to us with a single sales
line and nobody does one thing.
If it's by price, format orlocation or type of service, we
want to know what those revenuestreams are in a way that makes

(27:38):
sense to the business owner.
The end goal of the revenuesection is to understand the
true profit margins, not your100% service provider thought
profit margin.
And what is that?
Profit margin by product orservice.
Then we get into expenses andwe're looking at all of those
operating expenses.
And what is that?
Profit margin by product orservice.
Then we get into expenses andwe're looking at all of those
operating expenses and weliterally will go through my
team will go look up who's thevendors for all of these things.

(28:00):
Is it a required cost for yourbusiness?
Is it what we think is either apassion project, like
charitable contributions, or apersonal park, like kids on
payroll?
That's really more of anowner's comp that you get to run
through the business and theneverything else.
We sit down with them in thatmeeting and we say this is an
investment.
What is it returning in time?
Money or both?

(28:21):
And we start to get thebusiness owner thinking about
what are those KPIs?
How is it giving back to mybusiness?
What are all these shiny objectbolt-on systems or people that
we have added over time, thataren't necessarily adding value?

Speaker 2 (28:35):
Or people we're protecting, that we had for 20
years working for us.
Yep, that's another one.
So anyway, I did have one otherthought and then I'm going to
let Eric.
I'll turn the interrogationback over to Eric.
So how do you deal?
Well, let me rephrase it A lotof accountants I've dealt with

(28:59):
don't seem to understand that mygoal as an entrepreneur has
always been to build value in mybusiness and have a big exit,
whereas they seem like they'repreoccupied with short-term
profitability and the two areindefinitely in conflict.
I mean, I can just you know,I've told it on this show before

(29:19):
.
I mean, I remember a storyafter we were in business, like
probably, I don't know six orseven years, and our accountant
says to us, me and my businesspartner that well, you could
have each out another two,250,000 out of this company this
year.
And we're like you know, Bob,you've got a four person company
.
Okay, you don't understand whatwe're trying to do here.

(29:42):
We're trying to grow this thingand sell it to private equity,
which we did.
How do you, how do you dealwith that?
I mean, do you find that mostsmall business owners are more
concerned about their short-termprofitability, or they want to
have a big exit, or do theyexpect to do both, realizing

(30:03):
they may be in conflict?

Speaker 1 (30:04):
It's a mix, and one of our earlier meetings with new
clients is always going tofocus on what their goal is.
I want to know is your goal?
Because some of the clients andI've heard you talk about this
on other podcasts, but someclients come into this and
they're like I want to get moretime back?
And I get that.
We all go into this thinkingwe're going to have this really
cushy lifestyle job and thenwe're working 80 hours when we

(30:27):
thought it'd be 20.
But it's not impossible to getsome of that time back.
But to do that, you have tocreate operational efficiency
and you've got to buy that timeback with people.
And that's where we startcreating that exit plan.
So I'll give you a couple ofexamples with real clients We've
got.
One of our larger firms isactually in the conversation of

(30:49):
how do we add value?
We don't want to just take allthis money out.
Their emergency fund needs tobe like a million dollars and
that sure should not be sittingin a like zero percent interest
bank account.
How are we adding value to thisfirm?
And we're talking about realestate and offices and how to do
things that sit on the balancesheet not just the P&L but also
create a more effective taxstrategy for them, because then

(31:12):
they can leverage the rentstrategies and the real estate
tax stuff.
Versus another one of my clientsthat's been with me.
He was one of my very firstclients.
He's an engineer, does a lot ofoutsourcing and does it as his
second career and I'm like look,you don't want this to be
nothing at the end.
So we have to start talkingabout how do you find a mini me?

(31:34):
How do you find somebody thatmight be interested in this down
the road?
How do you start to trainsomebody and get them involved
in the relationships, becauseright now you are the business
and you can't sell that if youwant to get out.
So those types of conversations.
Versus I've got anotherattorney that's a small firm who
finally found her mini me andshe's getting her time back and

(31:56):
we're in that place of okay.
Now where do we createoperational efficiency so that
we can exponentially scale this?

Speaker 2 (32:04):
Yeah, yeah.
That's where you really startgetting into what I would just
call really almost classicmanagement consulting, as
opposed to just financial.

Speaker 1 (32:14):
And there's a little bit.
I mean, I'm sure you experienceit too when you're a CFO.
There's almost as muchmanagement, coaching, consulting
, goal setting, and we're justputting it into numbers, Sure.

Speaker 2 (32:27):
Yeah, I find that, unfortunately, a lot of
professionals which is what youknow you're working with,
regardless of what theirdiscipline is they just they
feel like it's I don't know ifit's beneath them or it's just
too boring or they don't haveyou know have an interest in it,

(32:47):
but they just don't payattention to the numbers.
They pay attention to sellingand client service and the doing
of whatever the place does.

Speaker 1 (32:57):
That's why we get to exist, because we love the
numbers.
I have some clients.
We'll get on those calls and Iwon't even bring up the
financials.
We'll start with talking aboutwhat's giving them heartburn
right now and because I know thefinancials, we can talk through
whatever that is.

Speaker 3 (33:12):
I mean I can.
That was kind of what I wasbitching about earlier.
You know a little bit, but Imean you know.
Excuse my language, danielle.
Sorry Mark.
Mark requires me to cuss onthis show.
I personally don't use anyprofanity, but Mark said if
we're going to do a show,together yeah, yeah.

Speaker 1 (33:28):
It's such a lie.
It makes us all human right.

Speaker 3 (33:31):
I guess.

Speaker 2 (33:31):
so I mean I am who I am now.
Well listen, I happen to haveread that people who curse more
are actually more intelligent.
Oh, that's cool.
Anyway, I'm going to go stakemy-.

Speaker 3 (33:42):
That's what I'm cutting now, right there, that
peer pressure.
But I mean to your point though.
This is my thought and I wantto bring some comfort to any
entrepreneurs out there, becausemy thought process is to answer
your question.
I'm in the business formarketing.

(34:03):
I can see the things, a problemthat needs to be fixed.
I'm trying to articulate thatvalue to clients all the time.
I spend all my time, my wakingmoments, trying to find a value
statement that simplifies whatthe hell it is that I'm talking
about, this complex thing sothat somebody else can
understand it.
Building graphics and sites andmarketing programs to

(34:25):
communicate sales and meetings,drinking coffees and all this
crap.
The last thing on the planetearth that I have any kind of
attention and time for are allthese numbers.
With all these, you know, allthese different, different
reports and all these differentthings, it becomes this whole
other thing that I want todepend on somebody else.

Speaker 1 (34:49):
But I bet you would care if I came to a meeting and
I said, hey, you were expectingto make $100,000 in revenue this
month, but your team onlyperformed at 80% and we came in
20% short of that.
Oh, I would totally care,because now you need to have a
conversation with the team andfigure out are we using the
right tools, do we have theright people?

(35:10):
Do we have the right processes?

Speaker 3 (35:12):
No, I totally care about that.
I just don't want to be the onethat has to figure it out.
Yeah, I just want it done, butdon't you, I'm doing my job.
Why can't you know?
Why can't?

Speaker 1 (35:24):
everyone else do theirs.
I will be honest, I would betyou, out of all of our clients,
maybe 10% actually open theirCFO reports that we, we, send.
They want to have the plumberthinking I bet they're not and
if they do?

Speaker 2 (35:35):
they're looking at the graphs and not the numbers
so so I'm kind of your, I ampart of your, basically your
clientele because you don't wantto be in the weeds, so we get
in the weeds for you yeah, Iwant everything done for me and
yell but don't you think I meanI I guess I'm having a little
bit of a problem with that Istart to understand, maybe, why

(35:58):
you struggled for so long andI'm still struggling.
You made the big bucks becauseI think if you're not really
tuned in as a small businessowner to your numbers I mean I
always advocate to my studentsdon't give up your bookkeeping
until you're at a certain level.
I mean, for me it was like amillion, five or two million a
year.
I wanted to see every dimecoming in and going out and it

(36:22):
gave me a much better sense ofthe business than if I had just
delegated that to oh you'refunny.

Speaker 1 (36:28):
It's the first thing I tell everybody to get rid of.
What's that I'm like?
Go find a bookkeeper.
I don't care who you are whenyou started, what level you're
at, go find a bookkeeper.

Speaker 2 (36:38):
Okay, well, I'm just telling you that my experience
was that I've always had theseundercapitalized bootstrap
companies, and so I just had tobe that close to the numbers to
develop a sense of it.
I mean, we used to even say topeople like you should always
open your mail.
I mean you remember this, yep?
I'm sure Don't you.
It's like one of the fraudprevention uh measures is the

(37:03):
business owner opens all mail.
Yeah, because there's so manyways people can steal from you
with fake invoices and stufflike that.
But it's sort of analogous tolooking at keeping the books and
signing the checks.
I mean, at least sign thechecks right.
Would you say that, danielle?

Speaker 1 (37:21):
yes, you need to know every check going out the door
okay.

Speaker 3 (37:25):
Well, maybe that's so .
I know that I like, I approveall that kind of stuff, but I
mean the.
I guess my thing is is I'm Irecognize and appreciate and 100
value the significance andimportance of it.
I just don't have the capacityfor it.
That's why you hire.

Speaker 1 (37:43):
I was going to say that's what CFOs do first.

Speaker 3 (37:45):
Now didn't I just do a fantastic job of setting that
up so that we have more salesand marketing For Danielle?
That's what I do.

Speaker 1 (37:57):
I need Danielle to do numbers for me your bookkeepers
are going to ask you a millionquestions and I mean, let's be
honest, they do.
And when I talk to thebookkeepers because we don't do
bookkeeping, coming from anaudit background I'm all about
the segregation of duties.
I was like I don't want.
You need as many eyes on yourfinancials that you can get, and
yeah honestly, I actuallyprefer when your bookkeeper and

(38:19):
your tax preparer are completelyseparate, because then
everybody can ask questions, andthat's important.

Speaker 3 (38:26):
On that real quick, danielle.
So what I like about that is isso would you recommend?
You have a bookkeeper?
You have the CFO fractional CFO.
You have a tax preparer and anauditor CFO.
You have a tax preparer and anauditor.
Four totally different folks indifferent companies.

Speaker 1 (38:48):
If you are at a point where you need audit.
Yes, I would say a lot of ourclients are not at that
perspective and as a fractionalCFO, we usually, if it's just
small bank stuff and justreporting, we usually step in
for bank covenants.

Speaker 2 (38:57):
Yeah, you'd probably just do mostly compilations.
I don't even know if you do.
You do many.
Well, you're not in the public.

Speaker 1 (39:02):
I don't even do compilations, because we're not
a compilations.

Speaker 2 (39:05):
So forget that.
Um, that's, that's what theiroutside bookkeepers or
accountants would do for them.
Yep, Um, so yeah, I think too.
Just step back for a minute onthe CFO role.
We're kind of focused in someof the nitty gritty stuff here.
I think a lot of people don'treally appreciate maybe broader

(39:27):
concepts, such as a good CFO isgoing to help you minimize the
capital investment it takes torun your company.
Okay, now that's a really coreidea.
Okay, Now that's a really bigdeal.

(40:01):
Speeding up billing, speedingup collection those are things
that improve cash flow, takeless capital.
Looking at things, as Daniellesaid, like utilizations of
individual employees and howchargeable they are versus their
billing rate, which really youknow, that's the other side of

(40:24):
it, I think, Danielle.
And their collection rates andtheir collection, yeah, what's
actually realized?
You work with theseprofessional service firms.
My experience is they'repreoccupied with how chargeable
somebody is, but A.
It doesn't mean that it's goingto get billed to a client
number one.
They could.
How chargeable somebody is, butA it doesn't mean that it's
going to get billed to a clientNumber one.
They could be chargeable to anover budget job and you discount

(40:46):
it, yeah, and so it's not thewhole measurement of what they
do.

Speaker 1 (40:52):
So what we do and I love this because it gives the
business owners a really clearperspective when we're going
through that revenue process.
With a service provider.
We create a budget based oncapacity, so I want to know what
is their billable rate and howmany hours should they be doing
billable work?
Because, let's be honest, we'veall got admin time, so you
should be doing billable work 30hours out of the week and

(41:13):
you've got a $350 an hour rate.
I don't care if it's flat fee,contingency, any of it, that's
what's going in the budget andif we're not hitting it, we have
a problem we need to solve.

Speaker 2 (41:25):
It's how much revenue you're generating.
I call that the revenue factor.
It's really your labor costs toyour revenue, total labor costs
for an individual.
But it's exactly what you'resaying, and and so, yeah, I
think, but these, these sort ofbad habits have been like
programmed into them.
Well, that's the way we did itat this old law firm that I

(41:47):
worked at all about billablehours.

Speaker 1 (41:49):
Yeah, it's all about billable hours, period um but
the really way to make sense ofit is if you've got a, let's say
, a two thousand dollar flat feethat you thought was going to
take somebody five hours andit's taking them 10, don't you
need to know that, cause youcould build them out at three 50
for a whole lot better thanthat.

Speaker 2 (42:09):
Yeah.
So anyway, though the CFO, youknow they're going to help you
with your banking relationships.
That's a big deal and helpmaximize the amount of credit
you can get.
Do you do a lot of that?
You mentioned lines of credit.
You want your clients to getthem.
Get them, while you don't needthem.
Obviously.

Speaker 1 (42:30):
Even though the interest rates are not great
right now, get them.
While you don't need them,negotiate them again later.

Speaker 2 (42:35):
Sure Do you find a lot of clients in these small
businesses don't understand thatthere are covenants tied to
these lines of credit thatthey've got to maintain.

Speaker 1 (42:45):
Oh, almost none of them do.
But I will say before we go toodeep into it, we are not huge
on the funding and the privateequity and the banking side.
We do a lot more of theoperational side.
We have some partners that wework with that are really great
in that space if they needadditional help on the banking
and capital aspect of it.
We're more in the managing andmaking sure that we can go get

(43:08):
all the right things in place.

Speaker 2 (43:11):
Right.
What about like compliancerelated stuff and forms that
have to be filled out?
Do you guys get involved inthat at all for these companies?

Speaker 1 (43:21):
Depends on the responsibility of the form.

Speaker 2 (43:24):
A lot of times, small business owners, as you well
know, like anything that doesn'tfall in the domain that they
like lands on the desk ofwhoever it is that's in charge
of financial stuff.

Speaker 1 (43:37):
But that's what a really great referral network's
for, because then I'm likehere's a great attorney that can
help you with that one, orhere's a great CPA that can do
that piece of it.
Or because, like I said, we donot operate as a CPA firm, so by
all technicality we can'tofficially file anything for
anyone.

Speaker 2 (43:58):
Yeah Well, I mean maybe not officially filing, but
filling all this stuff out.

Speaker 1 (44:03):
And we do have a lot of that when it comes to bank
forms and lending, and they wantthis report and that report and
these forecasts and all thethings.
We absolutely jump in and helpwith those pieces.

Speaker 2 (44:13):
Yeah, like an insurance audit or something
they don't know how to deal withgoing through the payroll and
putting all these stuff andfighting the insurance company
that suddenly gives you a billand says you owe me 12,000 more,
right.

Speaker 1 (44:27):
That's where I would go.
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an HR?
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Speaker 3 (44:50):
Hey Danielle, with the last kind of question on my
end before we get going.
Unfortunately we're alreadyalmost out of time.
I'm sure y'all out of time.
I was going to say I bet y'alldidn't even notice that time was
going by.

Speaker 1 (45:03):
We could talk numbers all day.

Speaker 3 (45:06):
We might just clip me out of this entire show today.

Speaker 2 (45:10):
I put that at no value, but you're one of the
most important pieces.
You're the archetypal client,that's.

Speaker 3 (45:16):
The other thing about my side is that I need a lot of
emotional support.
Your eye candy, oh, you're theeye candy, you're definitely the
eye.
Oh lord, you are funny so, butbut how does a small business
like, okay, let's take about,let's take two small businesses.

(45:40):
Really, you got your brand newentrepreneur never done we talk
about this a lot never done inbusiness before in their life?
They have an idea they're aboutto quit their job, your
professional job.
What is the first thing thatthey need to do, and when do
they need to do it?
Do they do it before they quitthe job or when they start?

(46:02):
And when they do start, what isyour advice?

Speaker 1 (46:05):
as this, as a fractional CFO, Calculate your
runway and you do it before youquit.
You've got to know what therunway is and you've got to know
if it's feasible and I say thisfrom experience.
I quit, got let go from my job.
I knew that.
Not going to lie, we had a nestegg.
I knew we had this nest egg.
I knew it was going to last forthis long and I had this much

(46:26):
time to make this work or to goback and get another one.
You have to have a runway.
Somebody has got to pay thebills.
You can't lose your mortgagewhile trying to set up your
business.
You've got to know what yourrunway is.
And to know what your runway is, you've got to know either what
your capital or your nest eggis and you've got to know what
those minimum required expensesare for you to get off the

(46:48):
ground.

Speaker 2 (46:50):
That's good, I never had that luxury.

Speaker 3 (46:52):
No, I didn't either, but I wish I would.

Speaker 2 (46:55):
I will say, Danielle, that my experience, I mean I
don't disagree with you.
I think most people wouldcertainly benefit by thinking
about all those things andreducing their personal overhead
to the lowest possible pointthey can, Right, so they don't
have to take more out of thebusiness than necessary to live.

(47:15):
But my theory is that whenyou're vastly undercapitalized
and you start a business, itactually makes you a better
business later because you'regoing to be so concerned about
your cash flow and basicallyevery dime that it builds a
discipline in that you know whenyou're like Eric and you sell

(47:38):
your company and you have allthis cash sitting there and then
you start starting up all theseother businesses and your
survival, and when I say nestegg, I don't necessarily mean
when we're talking runway, it'snot necessarily that you've got
this giant saving.

Speaker 1 (47:54):
We're not Eric with millions over here in the bank.
Yeah, we're not Eric withmillions.
No, we're here in the phone.
Yeah, I will tell you, I haveclients that come to us in that
phase and they know they've got$20,000 on their credit card and
how long will that last you toget going that you then have to
pay?
If that is your runway, that'syour runway.

(48:15):
You've got to know where itgets you.
The bills have to get paid oneway or another.
You're not going to get kickedout of your house.
Your runway may be your creditcard.
Your runway may be arelationship with the credit
union down the street that'swilling to give you $20,000 to
try and get this going.
It's not a huge nest egg and Ipromise you.
Getting laid off from oil andgas was not a huge nest egg, but

(48:36):
it was enough to say I've got Xamount of months.
Remoreling gas was not a hugenest egg, but it was enough to
say I've got x amount of months.
And if I get my shit togetherwe're gonna go, and if I don't,
then I gotta get suck it up andgo back I think a lot of people
under appreciate the solid it issolid, sucking up and going
with it.

Speaker 3 (48:52):
I think a lot of people under appreciate the
power of the runway via creditcard.

Speaker 1 (48:58):
Yeah, especially like Not my favorite example, but it
is usually the go-to.
Let's be honest.

Speaker 3 (49:06):
Especially like the Walmart credit card and the
Banana Republic credit card 0%interest when you go.
Rotate too yeah yeah, I mean,like you buy stuff, like you buy
your groceries on credit cardsand then your clothes.

Speaker 1 (49:22):
And if you're a professional service, the other
option is you may be coming witha book of business.
You may know you have peoplecoming with you.
Yeah, and that helps too.

Speaker 3 (49:32):
Yep no for sure.

Speaker 2 (49:33):
Yeah, no, I mean, I think that's all solid, you were
going to say, though, so what'sthe difference in the new
company versus, I think, youroriginal?

Speaker 3 (49:42):
question yeah, so we're stuck apart to that.
So that was for the new person,right.
But then you also have somebodythat has started.
They've been doing bookkeeping.
When is really I mean youprobably say before but when is
it really the appropriate timeto bring in that fractional CFO,

(50:03):
like, I mean, go ahead andanswer that.

Speaker 1 (50:08):
From an operational perspective, because most of you
aren't looking at numbersanyway.
It's when you're looking tohire that mini me when you're
like all right, I've got to stopbeing the only doer in this
business.
I've hit capacity.
I need to start building a realbusiness and.
I need a mini me, I need anotherdoer, I need a revenue
generating person.
Hiring a fractional CFO isgoing to help you build the

(50:30):
budget and the scenarios of whatthat looks like.
We jump in and help set up.
What can we afford forcompensation?
What is their affiliation torevenue?
What do we want to incentivizeversus work being paid on salary
?
How do we want to set this upso that it maximizes your return
?

Speaker 3 (50:48):
So what that tells me is like okay, if you're an
entrepreneur and you want to bea solopreneur yeah, I don't like
that term, you know that, Iknow, but you may not
necessarily want to, you't?
I don't think the caution ofhave not having a fractional cfo
is too great.
But if you're trying to grow abusiness and you're trying to
actually you know what I'msaying get that small business.

(51:08):
That's the entrepreneur.
You're shifting from smallbusiness owner, yeah,
entrepreneur.
You've gone from.
You started the company.
You have a runway like wetalked about.
You have built some clients.
Now you need to start growing.
You got to start scalingyourself.
Yep, that's the trigger pointof when.
Hey, danielle, listen, I heardyou on the greatest business

(51:28):
video podcast on planet earthcalled big talk about small
business.
I'm the sexy man named marktwyke.
Like this beautiful specimen ofa man, I shouldn't say that,
okay, sorry about that, but yeah, that's the trigger time to
call it's to start talking right.

Speaker 1 (51:51):
Yeah, I mean, you don't want to be responsible for
somebody else's payroll andlivelihood if you have no idea
where your business is going.

Speaker 2 (51:58):
I think I agree.
That's a really interestingthing.
I've never had that triggerpoint explained like that.

Speaker 3 (52:05):
That's a big deal what she just said too.
When you go past the point oftaking care of yourself and
you're going to have to starttaking care of other folks,
right, the stakes get high.

Speaker 2 (52:16):
Yeah, Well, it starts .
I think you know another way tolook at it is just, you decide
that you want to be anentrepreneurial venture instead
of a small business.
Yeah, that's going to remainpermanently.
Small is only tied to you andwhat you do basically, and
everybody else is just not asellable venture.

Speaker 1 (52:33):
You're going to do a business that pays the bills,
and then you're done.

Speaker 2 (52:37):
But but the problem?
I mean we all know that right,there's no question to any of us
that that's a true statement.
But the problem I found with alot of these small business
owners is they strip the moneyout of it year after year after
year.
They don't hire anybody who'sany good, they don't train them
in the business itself, and thenat the end they still want to

(52:57):
get a payoff.
It's like I'm 70, I don't haveanybody good.
It's going to take over, though?
I was going to give it to mykid and she don't seem to
already told me they wantnothing to do with accounting
exactly and so.
But.
So now I need you to go sell mybusiness, okay.
Well, what are you selling you?
You've got you nothing it's you.

Speaker 1 (53:17):
You can't sell yourself.

Speaker 2 (53:18):
Yeah, you didn't invest in the system.
You can't go there.
Like I said, we've got nothing.
It's you.
You can't sell yourself.
Yeah, you didn't invest in thesystem, that doesn't mean you
can't go there.

Speaker 1 (53:22):
Like I said, we've got the one engineer and I adore
him and he's booking and Ithink we might have found
somebody that would beinterested in bolting on as a
partner and then assuming thebusiness and buying him out,
which is a great way to go ifthat's what you're in.
It's not impossible to getthere, but it's a lot easier to
build a scalable business fromthe start.

Speaker 2 (53:45):
That's right, yeah, and that's not going to maximize
your value.
It's an exit?

Speaker 1 (53:49):
No, but it does give you an exit.

Speaker 2 (53:51):
It's an exit.
Yeah, absolutely, that is true.
There are people who will Icall those just basically
takeover payment situationswhere you have some employment
income and your employees if yougot three of them or you're,
you know they're not going toget canned and your clients are
going to be able to.
You care about your clients.

(54:12):
You've got a way to take careof them when you're not there,
right?

Speaker 3 (54:16):
But there's got to be a value to the buyer.
Like what am I actually buying?
My buying more clients, am Ibuying a process?
They're getting some people andthey're getting some clients.
Yeah, yeah, or maybe they're.

Speaker 2 (54:25):
They're adding on to a new vertical relationships
yeah, maybe they get a service,like you said, that they didn't
have.
Yeah, you know they'reelectrical engineers and
mechanical, but they didn't doplumbing the sky's plumbing,
plumbing.

Speaker 3 (54:38):
But the problem, like you said a lot of times in the
small business owners.
They're exhausted, they justwant somebody to help get them
out of their situation andthey've worked their butts off
to get to that point and theysee so much value in what
they've built but nobody elsereally does.
Yeah, that's true.
I don't want to say this, butit is kind of like when I was

(55:00):
back in the real estate game andwe were doing um we were, I was
doing loans for folks andpeople would come in and say,
hey, I have this property thatI'm wanting to buy and is there
a home on it?
Yes, well, what's the home?
Well, it's a manufactured homeand we'd be like we can't lend,
we can't finance that, we can'tfinance that.
And they'd be like well, but ithas a deck and a pool to it.

(55:21):
I'm like that doesn't matter.
Yeah, it might be really nice,but the reality to it is is it's
still a manufactured home.
It's kind of the same thing.
It's like you can't have asolopreneur business and expect
that you're going to get boughtout, like you have some sort of
scalable thing for some, and tothat point, if you have a
solopreneur business and you aretaking it all out, you better

(55:43):
have a really great wealthmanager.

Speaker 1 (55:45):
that's helping you put it.

Speaker 2 (55:48):
Yes, very true, all right.
Well, if anybody wants outthere, wants to get a hold of
Danielle who makes a lot ofsense, by the way yeah, what?
How do they reach you, danielle?

Speaker 1 (56:01):
We're going to set up a landing page just for you
guys, so it'll be on our websitethe number four, not the word
corners cfocom.
And then it'll be big talk,small business oh wow, all right
, thank you.

Speaker 2 (56:12):
Thanks, and she's just trying to actually document
the value of our show hall.
Sounds like a cfo got behind.
She's covering.
She knows what she's doing overthere so so the number four
corner corners with an s cfocfocom

Speaker 3 (56:31):
slash big talk, small business big talk, small
business, all All right.

Speaker 1 (56:37):
That's great.
It was a lot of words.

Speaker 2 (56:40):
And what's your email address, Danielle?

Speaker 1 (56:43):
It's going to be my name, Danielle, at
fourcornerscfocom.
Again, the number, not the word.

Speaker 2 (56:49):
Okay, very good.
Well, that's great.
Well, listen, we reallyappreciate your being on the
show and wasting your time.
It is never a waste of time to.

Speaker 1 (57:00):
If anybody listens to this and we just get a little
bit of like, oh, maybe I need togo look at my numbers and not
be like eric, then, uh, this isa win, yeah that's, that's.

Speaker 2 (57:10):
That's a good boy.
She just jumps in.
I'm telling you she gets it.
Uh no, you're right.
I mean, I think there's a lotof lessons here whether somebody
actually hires Danielle to dothis or not that are really
critical for people to listen to.

Speaker 3 (57:27):
Yeah, I agree, it's been awesome.
I learned a lot, danielle,thank you.

Speaker 2 (57:31):
Thanks, danielle.
Take care you too.
Thanks for having me, and nowyou can join in on our, on our.
What is it?
Our final salvo here?
Yes, this has been anotherepisode of Big talk about small
business, oh I went too fast.

Speaker 3 (57:50):
No, you did.
Everyone's supposed to do ittheir own way.
Yeah, all right, thankseverybody.

Speaker 4 (58:00):
Thank you, danielle.
Thanks for tuning into thisepisode of Big Talk about Small
Business.
If you have any questions orideas for upcoming shows, be
sure to head over to our website,
wwwbigtalkaboutsmallbusinesscomand click on the Ask the Host
button for the chance to haveyour questions answered on the

(58:20):
show.
Stay connected with us onLinkedIn at Big Talk About Small
Business and be sure to headover to our website to read
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