I feel old saying this, but over the past 20 years, I’ve picked up a handful of vital money lessons that have made me a more successful business owner. There are ten lessons specifically that I believe EVERY entrepreneur and small business owner needs to know. Whether you’re just starting out or looking to improve your financial game, these ten lessons can seriously transform your business operations. Here they are in no particular order.
10 Money Lessons for Entrepreneurs
1. Don’t Spend More Than You Have
This might sound counterintuitive, especially in a world that often praises leveraging debt for growth. However, the peace of mind that comes with living within your means is invaluable. Avoid the stress that comes from over-leveraging and instead focus on generating more revenue, not borrowing more money.
2. You Cannot Cut Your Way to Growth
While cutting expenses is sometimes necessary for survival, it’s not a sustainable strategy for growth. True financial growth comes from expanding your revenue. Whether it’s through new services or acquiring new customers, focus on growth through revenue expansion, not just cost-cutting.
3. Invest in One Amazing Hire
One exceptional hire can accomplish the work of three average ones. Although it might seem expensive upfront, hiring high-quality talent saves you time and money in the long run. Always aim to hire A-players who can contribute significantly to your business.
4. Your Financials Are Your Business
Outsourcing financial tasks is common, but you must understand and regularly review your numbers. As the business owner, you’re the financial fiduciary. Review your financial data at least weekly (I review ours daily!) to ensure there’s no room for fraud or mismanagement.
5. You Can Only Beat Fraud If You Catch It Quickly
Daily checks and balances on your spending are crucial. Fraud can happen even under the most vigilant watch. It happened to us to the tune of $40,000 just a few months ago, despite our protocols and security processes. So regularly review your financial transactions to catch and address any discrepancies immediately. This vigilance can save your business from significant losses.
6. Tax Strategy Is Your Responsibility Too
Don’t rely solely on your CPA for tax strategies. Stay informed about potential tax-saving opportunities and bring those ideas to your CPA for vetting. Attend webinars, read financial books, and keep up with relevant newsletters to stay on top of your tax game.
7. Help Your Team Earn More as the Company Grows
Your team is integral to your company’s success. As your business grows, ensure your employees benefit from this growth. This fosters loyalty, retention, and a positive work environment, ultimately contributing to the long-term success of your business.
8. Turn Your Customers into Your Sales Force
This lesson is one of my favorites. Implement referral programs that reward customers for bringing in new business, essentially turning your customer force into your sales force. This not only increases your customer base but also builds a like-minded community that supports and sustains your business growth.
9. People Over Profits
A few extra dollars are never worth an unhappy customer or employee. Always prioritize people over short-term financial gains. Happy customers and employees are more valuable in the long run, leading to sustained success and growth.
10. Not Everything Is About Money
The most crucial lesson I’ve learned is that not everything revolves around money. Money is a byproduct of serving people well and doing something you love. When you focus on providing value, building meaningful relationships, and creating a positive impact, the financial rewards will follow.
Keep these ten principles in mind as you grow your business. These principles have helped me navigate the financial (super!) complexities of entrepreneurship. Above all, remember that money is simply a means to create value and leave a lasting impact.
If you’re looking to grow your business and would benefit from more personalized support, reach out to me and my team at Brand Builders Group to schedule a Free Brand Call. We build and monetize personal brands, and we’d love to help grow yours.
