No matter who you are or what your business idea is, the answer is yes. You just need the right people around you. But when you’re ready to throw your 9–5 job to the wind and take the plunge, who do you talk to about turning that industry-disrupting idea into a thriving business?
BlueRock’s Paul Evans reveals the critical points an entrepreneurial start-up must consider to turn their ideas into a successful business.
Business advisor or accountant?
If you only ever see your accountant at tax time, then chances are they’re not the right fit anymore. You’re going to need help – potentially in the form of an advisor. Picking the best advisor with the right experience and knowledge is critical to get your dream up and running. Some accounting firms are run by ‘business advisors’ that, other than running their accounting practices, have never actually been on the frontline of operating a business themselves.
That’s where BlueRock is different.
The founders of BlueRock broke free from the shackles of the big 4/mid-tier professional services firms with the sudden realisation that they had little to no actual knowledge of how to run a business themselves. How could they call themselves ‘business advisors’? To address this issue, they combined forces to dive into the deep end of the small business world: they built themselves a pub!
Learning from the ground up, their hospitality business enjoyed some major wins and its fair share of failures – but it’s now a major player in the hospitality world, particularly in Melbourne but also in New South Wales and Queensland.
The lessons learned from that real-life entrepreneurial experience form the backbone of the unique advisory business that is now BlueRock. And the lesson for you as a budding entrepreneur is to work with people who have real-life understanding of start-up life. They’ll advise you with confidence on the following elements of running a successful business.
Where should I focus my attention as an entrepreneur?
With any start-up business, it’s important to spend your precious time considering the most critical issues. Based on the experiences gained by the founders of BlueRock, we believe the critical issues can be addressed by routinely reviewing these specific areas:
- Finances – Are you preparing meaningful financial reports that give you the information you need in a timely manner? How are you tracking against your annual forecast? Do you have a pipeline of work or sales to achieve next month’s forecast? Are you tracking against budgets or have you even prepared a budget for the year? How is cashflow looking for the next week, month, quarter?
- Strategy – Have you defined your visions and goals for the business? Have you communicated this to your team? What’s your marketing strategy? Is it working? Is there a complimentary business that you could acquire? What’s your exit strategy and timeframe?
- People – Do you have job descriptions for everyone including yourself? Do you have regular catch-ups and feedback sessions? Do you survey your employees for satisfaction and engagement? Do you have underperforming people that are potentially impacting the performance and culture of your business? How do you exit these people? How do you recruit for new people that will enhance your business?
This is by no means an exhaustive list but by addressing the above issues you’ll be well on your way to establishing highly valuable disciplines in your business. Of course, this helps you achieve your short-term objectives and long-term goals.
How should I structure my start-up?
Just when you thought you’d accounted for everything you needed to get your business rolling, your new advisor starts talking about structures. Companies, trusts, partnership: it all sounds so expensive and unnecessary! But without a doubt, the absolute cheapest time to get your structure right is at the beginning.
As your business grows, the value of your business will hopefully be growing too. Any changes to your structure in the future must be carefully considered and researched to make sure any capital gains tax events are minimised or eliminated. If you leave the structure changes to later, you’ll be paying a lot more to either your advisor, the Australian Taxation Office or in some cases even both.
Getting it right in the beginning will set you up to protect your assets, manage income tax expense efficiently and ensure that when it’s time to sell your successful business, it should minimise capital gains tax.
How can awareness and accountability help?
One of the key indicators of successful entrepreneurs and businesses is their awareness. Be aware of your competitors in the market, how your staff interact with their communities, and how your business is travelling financially – this all plays a huge part in the success of your business and feeds into many important decisions.
The other key aspect is accountability.
If you’re relying on yourself for accountability, forget about it. Your good intentions are usually eroded by the distractions of day-to-day ‘fire fighting’ within your business. Business owners generally spend too much time ‘in’ the business rather than ‘on’ the business.
So, who will keep you accountable? Your business advisor – that’s who! At BlueRock, we meet with our clients regularly, preferably monthly, through meetings that address the critical issues you’re facing at any one time. This discipline builds in accountability for both parties to carry out the agreed action items.
How can I save time?
The typical entrepreneur tries to be everything to everybody, including the internal bookkeeper and accountant. This is often with little to no experience and sees you burning the candle at both ends, 7 nights a week. How long can you keep that up before something cracks?
Automation can help. Accounting software like Xero has significantly changed the bookkeeping world for good, resulting in considerable time savings for business owners.
For a reasonable price you can almost entirely eliminate the data entry process and the need for manual accounting journals. Bank reconciliations and payroll become one-click operations. There are many tools out there, so make sure to talk to your business advisor about the best one for you.
I’m ready to take on the world!
OK, it’s time to take that idea of yours and become the next big thing. To find yourself a good business advisor, ask your friends or your LinkedIn networks for referrals. Be prepared to invest some time finding the right person or firm for you – someone who knows your business and has walked in your shoes.
Get your structure correct now; not 10 years from now. It’s going to save you some cash in the long run.
Focus your precious time on what’s important. Build good habits now before bad ones set in that could derail your dreams. Involve your advisor in the process and build in an accountability model with them that no one can escape from.
Automate! Work smarter, not harder. There are so many cool programs out there now that make our lives easier. Talk to your advisor about how to automate to make your life easier. If they don’t really know, get a new advisor!
Good luck. You’ve got this.
Paul Evans is a Director of BlueRock Accounting and spends his days eating toast and helping entrepreneurial businesses grow.