Season 2, Episode 22. Managing Your Business Finances with Parker Stevenson
My guest, Parker Stevenson, and I talk all about finance. We talk about the biggest financial mistakes entrepreneurs are making, what numbers and metrics matter when growing your business, when it’s financially responsible to quit your job to pursue your business, and more!
Parker is a co-owner and the Chief Business Officer at Evolved Finance; a bookkeeping agency
that specializes in helping online entrepreneurs to build more profitable and financially stable online businesses. For over 6 years, Parker has been advising some of the top coaches, course
creators, influencers, and thought leaders on how to make more sound business decisions using their financial data. Before joining Evolved Finance, Parker spent five years at Adidas
America where he became the US product manager for a $50-million dollar a year product category.
[00:25] Financial Mistakes Entrepreneurs are Making
- Entrepreneurs are not paying close enough attention to their finances. Parker explains how a lot of entrepreneurs feel unprepared and uninformed in regards to finance, so they just hope that it works out
- The goal of Evolved Finance is to not only provide first-class bookkeeping services but educate their clients by simplifying financial concepts to empower them to understand it
[04:21] Which Metrics Matter?
- It all comes down to profit
- At Evolved Finance their goal is to get their clients at a 30%
- When a business isn’t profiting, the next place to look is at their costs or how to drive more revenue
- With good financial data, it's easier to look at that data and get feedback business owners need. As a business gets bigger, objective feedback becomes more necessary so that business owners can make better decisions
- What should SaaS companies that are looking to be acquired focus on?
[11:25] The Financial Risk of Leaving Your Job to Start a Business
- Why entrepreneurs not providing themselves a steady paycheck is a mistake
- Is there an amount that entrepreneurs should have in the bank before leaving their jobs to start a business?
- Parker talks about how most of Evolved Finance’s clients started their business on the side while working their jobs
- A big piece of entrepreneurship is risk management, and risk mitigation
- People have to go into entrepreneurship with eyes wide open
- If you can't start living off of half of your salary now and saving the other half in order to save up to start a business, you may want to think it over
- A lot of times your clients tell you who you really are, and what services you really provide that they care about. As a business is starting, it’s still growing and changing. Having a safety net in savings is vital
[19:58] Weathering the Storm of 2020 for Online Businesses
- Have three months of operating expenses saved up in the business
- Give yourself time to pivot and adapt and adjust to the market
- Become an expert in mitigating risks. What are the opportunities, advantages, disadvantages and vulnerabilities that your business has?
- As your business starts to grow, and you have more success, never take that success for granted. Always have a contingency or buffer in place
[22:237 Final Words
- Parker’s final thoughts
- You don't have to be a financial expert, and you don't have to be your own accountant
- Follow Parker. Links below
Key Quotes:
“I think a lot of entrepreneurs feel unprepared for [the financial] piece, and then subsequently, just ignore it. And just hope that it's okay, or hope someone else can take care of it.” - Parker Stevenson
“When we give our clients good financial data, which is what good bookkeeping should be doing, it's easier to look at that data and get the feedback we need as business owners. The reality is as your business gets bigger, you need feedback so we can make better decisions going forward as business owners.” - Parker Stevenson
“I think so much about entrepreneurship is risk management.” Parker Stevenson
“A lot of times your clients tell you who you really are, and what services you really provide that they care about. And so I do love the idea of landing one plane as you're launching the other so that you're not just left out there hanging in the wind.” - Natalie Born
Connect with my guest:
Visit Parker’s website: https://www.evolvedfinance.com/ or email him at Parker@evolvedfinance.com
Twitter: @evolvedfinance
Facebook: /groups/evolvedfinance
LinkedIn: /company/evolved-finance/
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