Salt Lake City Bookkeeping Blog

It was a great question I was faced with: "Can you expand on that? How to properly pitch a business idea." I was speaking at the Missoula Entrepreneurs Club and I was talking about the importance of pitching. I was a bit taken back because I didn't know how to properly answer the question. It's not that I don't know how to pitch but I didn't know how to give a short answer to that question. In the end I ended up telling them the difference between pitching to a banker vs an angel investor. I am by no means an expert on pitching a business idea but here are my thoughts on it.

One thing I learned from the Goldman Sachs 10,000 Small Businesses Program was how to properly raise money for your business.  I didn't think I would ever want funding for our business, but now I know the value of getting funding and how to go about it.  I absolutely believe I could bootstrap many of the ideas I currently have, but I know that funding can accelerate the process and increase my chances of success.  I am by no means an expert on raising money as I have never done it, however I do have some thoughts on how to properly raise money for your small business.

I have noticed that small businesses typically have the time and money to fix their bookkeeping, but neither when they are first setting up their bookkeeping.  This article was inspired when I read a quote from Seth Godin posted on Hubspot's blog.  If you scroll down to #14 you will see Seth's quote: "Well, if you don't have time to do it right, what makes you think you'll have time to do it over?" This resonates with me on so many levels.  When I was growing up, my dad always used to say in a harsh Massachusetts accent and sometimes slightly angry, "Matthew either do it right the first time or don't do it at all!"  That has stuck with me into adulthood.  Half-assing something is a waste of time and therefore counterproductive.  When small businesses are setting up their bookkeeping most won't take the time or money to set it up properly from the beginning.  However, when it comes time to fix a bad bookkeeping system there is always time and money and here is why.

There are many obstacles when owning your own small business. These obstructions can vary greatly from competition to customer retention, one of the greatest challenges we sometimes see as outsourced bookkeepers is the owner’s mindset of how they think the business should run.   They sometimes think they have the best business ideas but blame everyone but themselves for it not working.  To me, the mindset of the owner sets the tone for everything else within their business.  Are they treating their business as a hobby and not taking it seriously?  Or maybe they treat it as a lifestyle business and have modest goals.  Or they understand being in business is not easy and want to create the best possible environment for profitability and growth and have the understanding of running an investor ready business.

Every small business needs a bookkeeper regardless of the number of employees or the amount of revenue they bring in.  The old way of doing business was if you had a business you had a bookkeeper; period.  I think that business owners just felt they needed a bookkeeper at all times.  With the advances of technology and outsourced bookkeeping services most any business can afford a good bookkeeper.  Many small businesses would attempt do it yourself bookkeeping or have their CPA handle the books come tax time.  The general small business probably doesn't feel like they need a bookkeeper, but they do. 

As bookkeepers, we often work with businesses that have goals to grow their book of business and seek investors or someday sell to investors.  This isn't possible unless every
transaction is tracked and handled a certain way.  I'm always amazed at the different mindsets we encounter when talking with business owners.  Some treat their business as a hobby and tend to not take it serious while some treat their business very serious and understand it needs to be 100% accurate at all times in order to scale.  After talking investors and CFO firms, I've learned that it's always better to be in this ready mindset and not be caught off guard by not being ready to show an investor your books.  I've come up with a few areas that all small businesses should focus on if they someday want to present their books to investors.