From Solopreneur to CEO: Putting the Pieces Together
As a solopreneur, we are often so busy in our business that thinking about the future sometimes takes a backseat - there's simply too much to do in the present!
However, this series has helped us put the pieces together so that we can take that final step: building a financial strategy.
We previously talked about putting good processes in place to organize the financial side of your business. Then, we delved into strengthening our money mindset to face our discomfort head-on. Finally, we set out to understand what our financial statements are telling us.
Those pieces together lead to the final step - the true step that separates the solopreneurs from the CEOs. That is using the information you have, giving it meaning, and using it to drive your business forward.
This article will help simplify financial strategy by breaking down the process into four key steps: define your goals, build your financial plan, and maintain your financial health. In each step, you will see how the preceding steps must be in place to make your financial strategy a success! (If you missed our previous articles, you can find Parts 1, 2, and 3 here.)
Defining Your Goals
The difference between a goal and an idea lies in its specificity. An idea is a thought or plan you wish to pursue.
A goal has specific criteria, timeline, and financial requirements attached to it. For example: "My goal is for my company's revenue in 2022 to be twice what it was in 2021."
In order to make that goal specific and realistic, you need to know what your current revenue is and have the mindset that it is truly possible. To know your current revenue, you had to keep track of your income and have some sort of process for doing so.
Additionally, our previous steps will give us insight as to whether our goals are truly worth pursuing. If we review our financial statements and notice that a product is not creating the type of profit margin that we think it should, would we make it a goal to expand that product? Of course not! That would give us the information we need to focus our efforts elsewhere!
Build your Financial Plan
If setting your goals is determining the destination, building your plan is outlining the journey. In order to truly reach financial goals, you need to break them down into smaller milestones and determine what your plan of attack should be along the way.
The first step in developing financial plans for each source of income should always be taking a look at where that money comes from now. Then, you can determine how much money is needed. You can look at your operating expenses and see if there are opportunities for you to streamline.
This is just the tip of financial planning, but if you can begin building your financial plan now, it will help ensure that every aspect of your business runs smoothly and efficiently.
Maintain Your Financial Health
The most important quality in business is consistency. It's not just about doing the right things - it's about continuing to do the right things!
We can compare it to our health. In order to have long-term health, we need to do more than eat healthy foods and exercise once. We have to maintain a routine of healthy eating and exercise.
When we build strong foundations and make those processes habits, it will be easier to continue keeping good records. When we truly believe that handling our money is possible for us, we will be motivated to continue and will not avoid our financial statements. Regularly reviewing and understanding our financial statements will ensure that we are staying on the right path.
Putting those pieces together will give us the tools that we need to set a financial strategy going forward and move towards meeting those goals.
From Solopreneur to CEO: What it means for your business
What we have outlined in this series is a transformation, from being someone who has a business to someone who runs their business. It is the difference between fumbling and walking confidently.
What does it mean for your business when these steps are in place?
It means a more confident you. A more empowered you. Someone who is taking charge of their business and making CEO-level decisions.
Many businesses that thrive are the ones that build strong financial foundations and keep building upon them.
If you want to upgrade your business and be your own CEO, we welcome you to join our next class of Money-Smart CEOs. In this class, we will expand upon the principles we've covered in this series. We will dive into financial terminology and processes so that you can streamline your business.
This course is self-paced so you can move at your own level. You will be supported by our team and a Facebook group of fellow solopreneurs. We are also including our mini-course on HST - something that growing businesses often struggle to understand.
This course is designed for you - the awesome CEO who is going to do great things with their business! If you would like to learn more, we welcome you to book a call with our team or visit this link.
