In my 10+ years as a practicing business attorney, including the past 4+ working with a high volume of startups through my Firm’s INCubation Center program, a common misstep I see entrepreneurs make is to focus too much on the greatness of their idea, and not enough on the business operation needed to grow the idea into a successful enterprise. Too often, great ideas end up failing to launch because the entrepreneur exhausts all available capital too early in the process. Proper cash flow management and a savvy financial mind can help avoid this pitfall.
That’s why I asked a couple of my friends, Faye Swenson and Dave Harvey of Financial Sync, to contribute their two cents to the “Startup Steps” series and explain why it’s important to have a top notch chief financial officer and a plan to manage the business’ finances.
It’s tough to grow your business when you are continuously “in” your business. That’s why companies turn to Financial Sync for critical business service needs. From CFO level expertise to daily, back-office operations, and everything in between, Financial Sync professionally manages the financial aspects of their clients’ businesses. They work with a wide variety of small to medium sized organizations, customizing our solutions to meet their specific needs and budgets. As a result, their clients can spend their time and energy on revenue generating activities – focusing on their business, vs. in their business. Growing profitably, and saving money.
For more info on Financial Sync, check out their website at http://www.Financialsync.com.
Now, here’s Dave and Faye!
The Importance of Having a Good CFO
Dave Harvey and Faye Swenson, Financial Sync
95% of all new businesses fail within their first two years. Why? Not because of a deficit of talent, great ideas, customer service, the ability to sell, or for lack of trying. If you find yourself awake until 2 AM on a regular basis working on your business, or frustrated about not getting ahead of the curve despite all your efforts, take a minute to reflect on this: Surviving business owners know one thing: good financial management is the foundation for ensuring business success – giving their time, talent, and ideas every chance to bear fruit. And while a good financial plan can help overcome any business obstacle, there is no amount of money a business can make to overcome poor management of their finances.
Here are some of the benefits that a good financial plan can give you, both tangible and intangible:
• Cash Flow Management –you run your business, instead of it running you
• Short, Mid and Long Term Projections and Goals—line of sight to revenue breakthroughs, milestones and business goals
• Definition of your ‘hedgehog’ –your passion, core competencies, and analysis of your greatest profit streams and profit potential
• Control –optimally interact with your business driven by meaningful interpretation of your numbers/data
• Time—easier and faster to navigate the waters of your organization
• Exit strategies—you will leave your business at some point in the future, either by a planned design or random circumstance – the path is your choice!
The health of the US economy has been and will always be tied to the growth of small businesses. The greatest breakthroughs, such as the telephone, the light bulb, and the internet, and companies such as Nike, Microsoft, and Craigslist, all started as ideas, just as your business has. Look after the financial well-being of your business to ensure that your dreams and great ideas come to fruition.