I've been an entrepreneur for 7.5 years.
These rules-of-thumb would've saved me 5 years of time and millions of dollars.
7 business laws to ignore at your own risk:
These rules-of-thumb would've saved me 5 years of time and millions of dollars.
7 business laws to ignore at your own risk:
Cash on hand:
Keep 2.5 - 3 months of expenses in cash.
(maybe 4-5 right now)
This provides security because even if revenue declines 50% you'd have 4-6 months runway.
Cash crunches lead to insolvency when revenue dips and there's no savings.
It usually comes on fast!
Keep 2.5 - 3 months of expenses in cash.
(maybe 4-5 right now)
This provides security because even if revenue declines 50% you'd have 4-6 months runway.
Cash crunches lead to insolvency when revenue dips and there's no savings.
It usually comes on fast!
Revenue per employee:
95% of SMBs/startups have too many employees, forcing the owners to suffer from stress and low pay.
If your revenue/employee is below $150K then you need to trim your roster.
It's uncomfortable but you must remove ineffective employees.
95% of SMBs/startups have too many employees, forcing the owners to suffer from stress and low pay.
If your revenue/employee is below $150K then you need to trim your roster.
It's uncomfortable but you must remove ineffective employees.
Organizational chart:
Making a bad a hire will cost $50-100K+ between wasted cash and opportunity cost.
Listing out every responsibility (and who fulfills) shines a light on needed skills and informs intentional hiring.
Update this with growth and new hires.
Making a bad a hire will cost $50-100K+ between wasted cash and opportunity cost.
Listing out every responsibility (and who fulfills) shines a light on needed skills and informs intentional hiring.
Update this with growth and new hires.
Ideal customers only:
Saying "yes" to every customer causes a cycle of low margins.
Non-ideal customers incur micro costs in that ruin the profitability of ideal customers.
These add up quickly.
TRIPLE down on the ICP and have the discipline to pass if they don't fit.
Saying "yes" to every customer causes a cycle of low margins.
Non-ideal customers incur micro costs in that ruin the profitability of ideal customers.
These add up quickly.
TRIPLE down on the ICP and have the discipline to pass if they don't fit.
Timely Bookkeeping:
From Day 1 outsource your bookkeeping to a professional for ~ $500/mo.
Clean (and up to date) books inform intelligent decisions across your firm.
Every company I've seen in trouble has messy financial statements and unclear/misallocated line items.
From Day 1 outsource your bookkeeping to a professional for ~ $500/mo.
Clean (and up to date) books inform intelligent decisions across your firm.
Every company I've seen in trouble has messy financial statements and unclear/misallocated line items.
Payables routine:
Only pay bills on the 5th and 20th of each month.
This helps you get in tune with how cash moves through your business.
Randomly paying bills causes anxiety because there is never a still frame picture of your true cash position.
Rhythms solve the problem
Only pay bills on the 5th and 20th of each month.
This helps you get in tune with how cash moves through your business.
Randomly paying bills causes anxiety because there is never a still frame picture of your true cash position.
Rhythms solve the problem
Receivables rules:
Customers, especially large ones, will bully you on payment terms.
But remember...
Payroll is incurred 6 times and monthly expenses 3 times during a T-90.
Do you have cash to float while you wait to get paid?
Accepting > T-30 is a risky game for SMBs
Customers, especially large ones, will bully you on payment terms.
But remember...
Payroll is incurred 6 times and monthly expenses 3 times during a T-90.
Do you have cash to float while you wait to get paid?
Accepting > T-30 is a risky game for SMBs
These "benchmarks" are malleable depending on your product or service.
But if you adhere to these principles your odds of success will be 10x greater than winging it.
It took 7.5 years of my time to learn these and now you have them for FREE.
But if you adhere to these principles your odds of success will be 10x greater than winging it.
It took 7.5 years of my time to learn these and now you have them for FREE.
I write tactical content about building profitable companies and dominating online.
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- Proven tactics
- Mistakes to avoid
getrevue.co
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