On A Mission To Teach Financial Literacy to Social Entrepreneurs. Invite Inside.
Decide if you are running a successful organization or an expensive hobby. No I’m not kidding. Make that decision consciously. An expensive hobby only drains cash. A successful organization is self-sustaining for the long haul.
Learn the basics of financial literacy
Would you drive your car with your eyes closed? Of course not. Then why do most non-profit and for-profit entrepreneurs run their organizations without knowing the basics of financial controls, like cash flow management. If that’s the key to survival, don’t you think it pays to invest a little time to get it right? That’s why I wrote the book, Accounting for the Numberphobic. I just couldn’t stand on the sidelines and watch great ideas consigned to an ash heap because those who started it didn’t know the basics.
Three statements hold the key
Net Income Statement, Cash Flow Statement, Balance Sheet. These three statements together form your financial dashboard. They are your global positioning satellite for running your business. Learn how to read them and you’re ahead of 90% of your peers.
Learn to speak the language of bankers, investors, donors
Creative types have this problem. They think if their idea is cool enough, they’ll get by. They won’t. Norm Brodsky, a successful entrepreneur and philanthropist says that half the small businesses going bankrupt could have made it if the founders learned basic financial management. Your financial dash board is always speaking to you, can you hear it?
Which of your products or services are profitable?
If you don’t know the answer to that question, it’s highly likely that you’re wasting your time delivering value to customers or clients that is losing you money.
Most small business owners think if they’re in a cash crunch, the way to solve that problem is to get more customers. If you don’t know what products or customers are profitable, you’re probably scaling an unprofitable model. You’ll go bankrupt faster. Ouch.
You need to know the three ways you can increase cash flow
And no, that doesn’t include getting a loan from your family. It means making sure you have the right benchmarks to price your products and services to start. If that’s not right, you’ll be working to push water uphill and you’ll never know why you have no money in the bank after all your effort.
When you close a new piece of business, you need to negotiate payment terms at the time of the sale, not six months later. Then it’s too late. Don’t know how to do that? Accounting for the Numberphobic shows you how. Doing this alone will change the risk profile and improve cash flow for your business.
The goal of any small business or non-profit is to become financially self-sustaining, isn’t it? So if you’re going to play a game, learn how to keep score first. A good coach doesn’t put a new player on the playing field right away. That player learns the goal of the game and how to track progress. This is what every small business owner and social entrepreneur needs. Your organization doesn’t have to become a statistic. I’m on a mission to teach financial literacy to social entrepreneurs and dreamers.
Join the #knowyournumbers campaign on
Tuesday, October 07 via Livestream.
When you #knowyournumbers, you can work half as hard and increase profits. Learn how here
From the Editor
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