#52: Back To The Basics: Essential Financial Knowledge for Founders

Next Level Pros

Nov 17, 2023•12 min•Transcript available on Metacast

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Episode description

Welcome to another episode of the Founder Podcast! Today, Chris Lee, explores the topic of finances. Operating a business often starts with a cash-based approach, especially during the early stages. Chris reflects on his experience running Founder Acceleration, a group of 50 entrepreneurs, and emphasizes the critical role of understanding the basic financials for scaling your business.

As Chris shares insights gained from scaling a business from zero to $233 million annually, he highlights the importance of CEOs and founders having a solid grasp of financial principles. While hiring professionals like controllers, CFOs, or accountants is valuable, Chris asserts that CEOs must possess fundamental financial knowledge to guide decision-making and drive profitability.

If you're looking to enhance your understanding of financial aspects crucial for business growth, this episode provides valuable insights. Tune in and take the first step toward becoming a more informed and strategic founder!

Don't forget to check out Founder Acceleration, where entrepreneurs gather weekly to discuss and learn from each other's experiences. Visit founderacceleration.com to apply and join this dynamic community of business leaders.

Highlights:

"Understanding the basic financials of your business is absolutely imperative to really be able to go and scale."

"You can hire a controller, you can hire a CFO, you can have a great accountant. But as the CEO, as the founder of your organization, it's imperative that you have a grasp on the basic knowledge."

"Your gross profit margin percentage should not vary tremendously, it should be within one to two points if you have a really tight dialed-in direct labor cost of goods sold, managing your inventory and those types of things."

Timestamps:

00:00: Introduction

02:21: Product Cost & Profitability

03:59: Revenue & Gross Profit

06:34: Acquisition Cost

08:19: Cost Management

Live Links:

🚀 Join my community - Founder Acceleration

https://www.founderacceleration.com

🤯 Apply for our next Mastermind

https://www.thefoundermastermind.com

⛳️ Golf with Chris