Jan 09 2012
Money is only valuable if you spend it or rather invest it in something of value.
Here is how I define value:
1. It helps to bring you to your long term vision
2. It is consistent with your business purpose and mission
3. It gives recurring rewards
What is the most valuable investment for your business?
Jun 21 2011
Cash flow frees up entrepreneurs to hire confidently, knowing there will be money to pay the bills. Investment drives large changes such as marketing placement, new technology platforms and product launches.
Experienced entrepreneurs know that it is tempting to spend a bucket of cash, à la the late 90’s when cash infused startups spent hefty pennies on designer chairs and fancy computers.
Don’t tempt yourself. Use budgeted cash influxes and expenditures from cash flow. Think water – it can be used to water a garden, or just be the flow in your toilet, gurgling to the sewer.
Be a smart entrepreneur, focused on spending money on what’s crucial to growing the business. Make your Cash Flow flow where it can grow things.
Jun 23 2010
When you don’t think you could go any further, when you feel you have hit a brick wall, when the bills are mounting and you don’t envision a way to get to cash flow positive – that’s when it hits you like a cold soft-serve ice cream cone on a hot day – I will go further, dig deeper-seek new knowledge and get to cash flow positive no matter what.
And that is when it happens-like the prize fighter taking an almost fatal blow, and then, in the one moment he rises up to find unprecendented strength and knocks down the challenger.
That is the sign of a champion – the ability to get up, no matter what. A champion is willing to keep going and learning until he gets it right.
May 12 2010
There is an old adage of ‘go to sleep with dogs, wake up with fleas.’
Investors know this, which is why they look to plunk down their money
into financially healthy companies. They are not just looking for a
“Happy Company” with growth, but also one that pays its bills on time,
collects its receivables and sends timely financial reports timely to
investors.
A company which does not know its cash position or its future cash needs
is disenchanting. Investors are wary of what “fleas” will accumulate on
their own stellar reputations, if it were known that they crawled into
bed with a financially irresponsible company. That is why you have to be
able to display a streamlined method of accounting reporting and
responding in order to attract investors. Part of my job as a “business
shrink” is to help my clients know how to get cash flow positive as
quickly as possible and learn what it takes to stay there.
May 05 2010
Perpetual Revenues (the second P in the word Happy) is the distinction of whether you have a business or not. Money or revenue is the market’s way of telling you your products and services have value.
H- Home
A – Assets
P – Profit
P – Perpetual Revenue
Y – You
Perpetual is a very important word before revenues. Perpetual means that those revenues will keep going indefinitely. At the cemetery the perpetual care sticker means that the cemetery will take care of the burial plot forever. Your revenues should hopefully be a systematic, recurring stream of income and take care of your business forever.
Without revenues you can’t pay your bills, your employees or yourself and there is no basis to whether your product has value because people are not willing to pay for it. Once you ‘turn’ revenues and you bring your product to market and have successfully sustained and grown revenues, then you will be on the road towards perpetual revenue.
A sudden flurry of income is not good enough. Ask yourself, your team and your customers, will this product/service still have demand a year down the line? How about ten? As you ask yourself these questions, you will be positioning yourself to ensure that revenue streams are perpetual, and that your business is not going to be here-today and gone-tomorrow.
Perpetual revenue — that is what makes a business immortal.
