You’re eager to get your new business off the ground and lay the groundwork for success. You’ve got a concept, a mission and the passion to make it happen. That’s the exciting part. But before you get too far ahead of yourself in terms of acquiring clients, rolling out your product or service and reaping returns, there’s a critical step that should never be overlooked: choosing your business’s legal entity.
There are plenty of reasons to romanticize entrepreneurship. Many of the stories you see lighting up headlines tell the tale of overnight success. But even Steve Jobs and Mark Zuckerberg had to overcome the difficult decisions and trying demands that are fundamental to achieving entrepreneurial success. If you want to become an entrepreneur, you must not lose sight of the often overlooked and underestimated keys to making your dream a reality.
No successful entrepreneur arrived at where they wanted to be without first understanding -- through education and experience -- the realities of business ownership. It’s easy to dream about climbing the mountain and reaching the summit, but unless you stay grounded in the realities of your financial situation, your personal limitations and the challenges inherent in the entrepreneurial journey, it will be difficult to fulfill your goals.
While business owners work diligently to manage operations, acquire new customers and wear the many hats adorned by successful entrepreneurs, someone must be at the financial helm. Without a solid team of financial experts, a business is much more likely to make uninformed financial decisions that could cripple the company in the short or long term. Those owners who benefit from the support of an experienced, skilled financial team have greater opportunities for profitability and growth. That’s why we love the finance team -- and so should you.
As you work tirelessly to manage your operations, develop your product or service, attract new business, pursue your long-term vision and handle the everyday responsibilities that come with running a company, it’s easy to let your accounting needs fall to the bottom of your priority list. It may seem like the big-picture decisions and emerging challenges are more important to tackle, and that your accounting functions can be put on the backburner for now. The problem with this kind of thinking is that it has the potential to wreak havoc on your financials and, ultimately, stifle your business growth.
In one of our recent blog posts, I explained some of the tactics for attracting investors who are seeking emerging-growth companies. Once you’ve successfully landed these or other types of capital for your business, the next step is strategically spending the money. Unfortunately, many entrepreneurs who are not experienced with capital deployment can fall into tempting spending traps that jeopardize the financial health of the company. To avoid this, it’s critical to familiarize yourself with resourceful ways to apply your business capital.
Your greatest business asset is not your concept, your marketing strategy, your funding or even your employees. It’s your customers. Because without them, your company is no more than an unrealized venture. Customers create the need for your offering, enable profitability and, ultimately, keep your organization in business. But not all customers are the same, and one of the keys to financial well-being is understanding which customers are most valuable to your company. In order to accomplish that, you must be able to measure customer worth.
There’s no doubt about it: Today’s business investors are on the prowl for new opportunities with emerging growth companies. If you’re in need of financial backing to achieve a highly profitable business, you need these investors to be looking your way. But attracting them isn’t typically an easy pursuit. It requires research, practice and the skills to engage people. Do you know how to reel in prospects?
At some point in your entrepreneurial journey, you’ll come to a crossroads and face the daunting decision between focusing on sales growth or pursuing profitability. Both of these outcomes are highly valuable for a business. Owners and corporate executives strive to position their organizations for both maximum growth and healthy profitability. Unfortunately, it’s nearly impossible to attain both at the same time.
You’re a business owner or a corporate executive, not an accounting professional. Your focus is on delivering a service or product, managing operations, maybe even selling. So, when it comes to addressing your company’s financial statements, you realize you need to rely on the experts.
Many businesses delegate this responsibility to a separate accounting department or defer the work to an outsourced accounting firm. Partnering with a skilled, experienced accounting team is one of the smartest decisions you can make for your business. But do you really know what to expect from your accounting professionals? Do you understand what a valuable partnership looks like?