Mark and Jesse ponder a question -- is there anyone who doesn't need a budget? What about a person in the upper, upper crust, that has hundreds of millions or even billions to their name? Or what about someone who simply has very few desires, that are easily covered by their existing cash flow? The discussion quickly gets philosophical! Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com...
Whether or not the successful admit it, luck plays a role in making things happen. Having the right at the right time, a chance meeting with the right person -- these factors could be called luck, and they matter in the world of business. But is that all there is to success? There's a saying that "luck is the residue of design," a nod to the influence of luck but also a reminder that without intelligent planning, execution, and effort, luck is wasted. Mark Butler CFO https://markbutler.com You N...
Mark and Jesse discuss some of their favorite books... and some of their not-so-favorite books. They both love to read books, especially about business, but they also admit a danger in the practice. It's easy to confuse reading books, or blogs, or listening to podcasts, as an act of creation, as if doing so is actually improving or advancing your own business. Occasionally they may offer insight, but even that is not an act of creation for the business -- it's only useful if you use the informat...
Business owners have a variety of reasons for starting and then continuing to operate their business. For many, it's to make money, or to make more money. Or, perhaps it's the security that comes with being your own boss. The desires that drive business owners can change and evolve, too. Some people endeavor to solve complex challenges, or to move the needle on a large industry or societal problem. Whatever the reason, Mark and Jesse argue that business owners need to be in touch with their reas...
There's something about business spending that seems special, more important or impactful than personal spending or at least worthy of some exemption from normal budgeting practices. Maybe it's the large amount of money that typically flows through a business (large compared to the business owner's personal salary or distributions), or perhaps it's a believe that any ROI business spending generates is better than mere spending. Whatever the reason, business spending often gets less scrutiny than...
Mark and Jesse answer a listener question: how do you pull the trigger on a big ticket purchase? When you've budgeted for a large purchase, and accumulated the cash, it's hard to see that cash flow out of your bank account. Mark and Jesse discuss the psychology behind large cash purchases, and how to manage your emotions as a business owner. Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com...
Mark Butler and Jesse Mecham discuss how much business owners should share about the company's financial position, and more importantly, why context for the information is vital to fostering trust and goodwill with employees.
Mark and Jesse discuss the concept of "margin of safety" in a business, that is, building in cash reserves to your operating plan for when things inevitably don't work out like you forecasted. Whether your business has to absorb unexpected costs, or revenue is down for a period, or some other "unknown unknown," having a margin of safety in your business ensures that you have the resources to survive the business cycles and thrive over the long term.
It should be no surprise that a business with 100 employees has different management challenges than a business with 10 employees. At some point, managing the business becomes less about the idea that founded the business -- creating something that people like and want, product market fit, etc -- and more about solving the logistical challenges of scaling that business to grow. As Mark and Jesse discuss, those are two different skillsets, and few people excel at both. Understanding your strength...
There's plenty of firms and consultants out there selling strategies and solutions for customer acquisition using partner programs, referral codes, and other internet based referral tools. They promise to be the "gasoline" that accelerates the fire of growth in your company, but do the results hold up to the promise? Is it possible instead to build a business where your main source of customers is simply referrals from other customers? Mark and Jesse discuss. Mark Butler CFO https://markbutler.c...
It's easy enough to convince ourselves that personal wants are "needs" that we just have to have. In business, the temptation is even stronger -- after all, it can probably be expensed, there are plans for growth, we have to keep up with the competition... However you spin it, most "needs" are really just wants, and our cash is a scarce resource. Recognizing our wants, however, can free us from the feelings of FOMO, the stress, and the tunnel vision that often accompanies strong desires, and ope...
It's a word that inspires yawns and sends meeting participants to their phones. But, it's something that strong leaders and strong teams do well -- process. Mark and Jesse discuss what it means to have good processes in your business, what they look like, and how to develop good processes. Process improvement doesn't happen overnight, in fact it often happens in tiny, incremental improvements over long periods of time. Learning to work on process as part of your normal business operations is the...
Mark and Jesse chat with their long-time tax advisor Casey Murdock about the importance of tax strategizing throughout the year, what to look for in a good tax advisor, when it's appropriate for businesses to do their own taxes, and more! Casey Murdock https://www.wealthguardadvisors.com/team/casey-murdock
Mark and Jesse invite their long-time tax advisor Casey Murdock, or Wealth Guard Advisors, to talk about common myths and misunderstandings business owners have about the tax code as well as legitimate tax saving strategies. Tax can seem like a tedious field, but having good tax strategies can result in big savings. As always, having cash on hand opens up options for tax planning. Stay tuned next week for more tax myth busting with Casey! Casey Murdock https://www.wealthguardadvisors.com/team/ca...
Cash basis accounting works for a lot of businesses, and it has a lot of benefits being simple, easy to understand, and a relatively "pure" way to evaluate the cash position of the business. But for some businesses it may make sense to switch to accrual accounting, where things start to get a bit complicated. Mark and Jesse set out to demystify accrual accounting and break it down into YNAB-equivalent terms. Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com...
Mark and Jesse take a break from talking about cash to focus on the "softer" aspects of running a business and, more specifically, a team. But, as these things tend to do, it turns out core values are everything about running a business, and they directly impact how your day to day business operations proceed. While very important, core values can be hard to determine, because they are emergent, not aspirational. You simply have them, or you don't. You don't aspire to have integrity, you discove...
Mark and Jesse discuss the role of forecasting in a business' budget, and why many businesses get stuck on "tracking" their finances, for tax purposes, rather than truly budgeting. Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com
Jesse and Mark answer the questions -- when do you start paying yourself from the business? How much? Should you take distributions or draw a salary? Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com
Jesse and Mark ponder the question: when has business done enough? Enough revenue? Enough profit? When has the business owner taken enough in salary and distributions? The answer may lead you to some uncomfortable questions and answers. Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com
How you manage your financial systems is an indicator of how well you manage the rest of your business, says Mark Butler. Long lists of bank accounts, complicated credit card payment schemes... as businesses grow their financial systems becomes more complex, but without careful management, it's easy to let become a jungle that accounting has to hack through every month to close the books. Simplifying these things leads to less stress, less hassle for your accounting team (and less cost), and imp...
It a fussy word, and almost sounds archaic nowadays, like "balancing your checkbook." But reconciliation is critical to ensuring that your bank account actually lines up with the jobs you assigned to your dollars in Rule One! Basically, reconciliation is a process in which you compare your actual bank balance to your balance in YNAB. This serves two purposes. First, it ensures that you are entering expenses in YNAB correctly; mistakes happen, direct import occasionally throws an error, or you ma...
Jesse and Mark wrap up their review of the four YNAB rules as applied to business with Rule Four, age your money. This rule is a consequence of following the first three rules, and it refers to the fact that once you have embraced the rules you will find yourself paying for this month's expenses with last month's money. Maybe even money from two months ago. That's called aging your money, and it's crucial for being strategic in business. Mark Butler CFO https://markbutler.com You Need a Budget h...
Mark and Jesse continue analyzing the problems of small business finance through the lens of You Need a Budget's "Four Rules." Today they explain that Rule Three -- roll with the punches -- is a call to actively, and continually , budget for the business. The budget is not a static document that gets set once a month, or once a quarter, or yearly, then measured against. Budgeting that way is a good way to feel continual frustration at not meeting numbers, because all budgeting involves guessing ...
Mark and Jesse expand on Rule Two, or "embracing your true expenses." When Mark onboard a new client, he helps them import six to twelve months of prior expenses into YNAB for analysis. With these numbers, Mark and the client can get an idea of the true expenses of the business, including expenses that occur infrequently, whether it's annual insurance premiums or unexpected costs related to operations. Often during this process the business owner will point out how the expenses during the histor...
Mark and Jesse discuss how YNAB's Rule Two can help business owners sleep better at night, by setting aside money for their known (and some unknown) future expenses like taxes, insurance, future hiring, and more. No more sweating during tax season wondering what your tax bill will be and how you are going to pay for! Mark Butler -- the Virtual CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com...
Mark and Jesse conclude their discussion of Rule One -- Give Every Dollar a Job -- for businesses by exploring how it can help anxious owners gain control over their emotions around money, cash flow, and what to do with the company's excess cash. Mark Butler CFO https://markbutler.com You Need a Budget https://www.youneedabudget.com
Mark and Jesse continue their deep dive into YNAB's Rule One -- give every dollar a job -- as it applies to businesses. Jesse says "show me your outflows, and I'll show you your strategy." The things a business spends it's money on, is a proxy for the businesses strategy, just like the things individuals spend money on is a reflection of their values. Mark takes this idea a few steps further, insisting that all of a business' cash is wrapped up in it's strategy, or lack thereof. Inflows, outflow...
Mark and Jesse discuss Rule One -- give every dollar a job -- for businesses, specifically around the concept of scarcity. There are only so many dollars available at any one time, and often not enough to do everything an entrepreneur wants to do. Mark argues that this scarcity is actually the entrepreneur's best friend, as it drives businesses to get creative about reaching their goals with the resources they have, rather than put themselves in financially precarious positions by borrowing mone...
Jesse Mecham, founder of software budgeting service You Need a Budget (YNAB), and Mark Butler, a virtual CFO who helps a businesses of all sizes manage their finances, join together to talk about the money issues many small businesses face, and strategies for addressing them. Today, they apply YNAB's four rules of budgeting to the small business, starting with Rule #1: Give Every Dollar a Job. By giving every dollar a job, businesses can not only create reserves for unforeseen expenses and avoid...
Jesse Mecham and Mark Butler are launching a show all about small business finance. They will help you solve your cash flow problems, budget effectively, and increase your profits.
