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Episode 62

E62: The Buyer's Perspective: What Buyers Look for in Your Financial Statements with Erica Goode

I had the pleasure of having Erica Goode, Fractional CFO to Coaches and Consultants, on the latest episode of the "Hourly to Exit" podcast, where we discussed some fascinating topics related to financial management, business growth, and the accounting industry.

Here are key takeaways from this episode:

  1. Understanding the Balance Sheet: Erica explained how assets, debts, and equity work together on a balance sheet. This knowledge is crucial for business owners and potential buyers, as it helps in evaluating the financial health and value of a company.
  2. The Importance of Accurate Financials: When forecasting the future of your business, Erica stressed the significance of having precise financials from the past to build a realistic projection. This includes understanding one-time expenses and not projecting them into the future.
  3. Shifting Perspectives in the Accounting Industry: Erica shed light on the challenges and drawbacks faced by accountants, such as long working hours and high burnout rates. However, she also mentioned the positive shift happening within the industry, with younger accountants working towards change and bringing fresh perspectives to traditional accounting practices.

If you're interested in learning more about these topics and gaining valuable insights from Erica Goode, make sure to check out the full podcast episode. You don't want to miss it!

More About Our Guest:

Erica Goode has been a Certified Public Accountant for 15 years. She runs a virtual accounting firm supporting coaches and consultants with bookkeeping, accounting, and CFO services and also hosts the Coaches, Consultants, and Money podcast. She’s a former Director of Finance at a Fortune 50 company and started her career as an auditor at a Big 4 public accounting firm. Erica is also the mom of 2 and the wife of a fellow CPA. She lives with her family in the mountains of Idaho.

Connect with Erica Goode:

Connect with Erin and find the resources mentioned in this episode at hourlytoexit.com/podcast.

Erin's LinkedIn Page: https://www.linkedin.com/in/erinaustin/

Think Beyond IP YouTube Page: https://www.youtube.com/channel/UCVztXnDYnZ83oIb-EGX9IGA/videos

Music credit: Yes She Can by Tiny Music

A Team Dklutr production

Transcript
Erin Austin:

Hello, ladies.

Erin Austin:

Welcome to the hourly

Erin Austin:

to exit podcast.

Erin Austin:

I am very excited to have

Erin Austin:

Erica good with me today.

Erin Austin:

Hi, Erica.

Erica Goode:

Hey, thanks

Erica Goode:

so much for having me.

Erica Goode:

Well,

Erin Austin:

we go a bit back.

Erin Austin:

And so I'm excited to have you

Erin Austin:

on to talk about, financials,

Erin Austin:

that buyers care about.

Erin Austin:

I think you might've called

Erin Austin:

it financials that matter

Erin Austin:

to buyers, but before we

Erin Austin:

jump in, I'd love for you

Erin Austin:

to introduce yourself to

Erica Goode:

the audience.

Erica Goode:

Sure.

Erica Goode:

So I'm Erica Goody.

Erica Goode:

I'm a CPA and I am a

Erica Goode:

fractional CFO for coaches and

Erica Goode:

consultants and individuals

Erica Goode:

who are growing those

Erica Goode:

practices, whether they

Erica Goode:

decide to be a soloist or

Erica Goode:

they want to build an agency.

Erica Goode:

I work with them on a daily,

Erica Goode:

weekly and monthly basis.

Erica Goode:

not just once a year as most

Erica Goode:

CPAs is that that's how often

Erica Goode:

most people see their CPAs,

Erica Goode:

but I am meeting with my

Erica Goode:

clients every single month and

Erica Goode:

we are talking about what has

Erica Goode:

happened in their business and

Erica Goode:

more importantly, what's going

Erica Goode:

to happen in their business

Erica Goode:

and planning that out.

Erica Goode:

So do you consider

Erin Austin:

yourself

Erin Austin:

a fractional CFO?

Erin Austin:

Is that kind of the role?

Erica Goode:

I do.

Erica Goode:

Yeah.

Erica Goode:

Yes.

Erica Goode:

And different people know of

Erica Goode:

that and don't know of that.

Erica Goode:

And so, yeah, I think it's,

Erica Goode:

a great resource to have

Erica Goode:

if you're ready to bring.

Erica Goode:

A financial professional

Erica Goode:

into your business more

Erica Goode:

than just once a year.

Erica Goode:

definitely fractional CFO.

Erica Goode:

It can be such a huge

Erica Goode:

resource into your business.

Erica Goode:

Oh,

Erin Austin:

I will say

Erin Austin:

like lot of us don't

Erin Austin:

understand completely the

Erin Austin:

difference between any kind

Erin Austin:

of accountant versus a CFO.

Erin Austin:

Like what's the difference?

Erica Goode:

Yeah.

Erica Goode:

So that's not uncommon.

Erica Goode:

I think there's so much

Erica Goode:

confusion in the industry

Erica Goode:

and looking into the industry

Erica Goode:

on what everybody does

Erica Goode:

and who do we call what?

Erica Goode:

And.

Erica Goode:

A lot of times the labels

Erica Goode:

overlap and people do

Erica Goode:

similar things, but I

Erica Goode:

would say like CPAs.

Erica Goode:

I think there's an assumption

Erica Goode:

that a CPA does tax.

Erica Goode:

I think CPAs is

Erica Goode:

just a designation.

Erica Goode:

CPAs wear many

Erica Goode:

different capes, right?

Erica Goode:

They can do many

Erica Goode:

different things.

Erica Goode:

And so I think there's a

Erica Goode:

difference of, you can have

Erica Goode:

a CPA who is your tax CPA.

Erica Goode:

And you can have accountants

Erica Goode:

or CPAs who are fractional

Erica Goode:

CFOs and those serve

Erica Goode:

very different purposes.

Erica Goode:

And a lot of times business

Erica Goode:

owners or individuals get

Erica Goode:

frustrated because they

Erica Goode:

think their tax CPA should

Erica Goode:

be acting like a financial

Erica Goode:

planner or a fractional CFO.

Erica Goode:

And then there's

Erica Goode:

all this kind of.

Erica Goode:

Yucky feelings

Erica Goode:

against each other.

Erica Goode:

Like, well, my CPA is not

Erica Goode:

providing this and my client's

Erica Goode:

asking me for things that

Erica Goode:

they didn't pay me for.

Erica Goode:

And so there's this lot of

Erica Goode:

confusion around, what is

Erica Goode:

the purpose and what are you

Erica Goode:

paying for when you have a tax

Erica Goode:

CPA versus a fractional CFO?

Erica Goode:

Yeah,

Erin Austin:

I've had

Erin Austin:

both and I've had the

Erin Austin:

disappointment of having

Erin Austin:

someone who was just like,

Erin Austin:

all I'm doing is your taxes.

Erin Austin:

And I'm like, but I've got

Erin Austin:

this issue, And then I've had

Erin Austin:

the, fortunately, I don't, I'm

Erin Austin:

not with that person anymore.

Erin Austin:

Now I have the more of

Erin Austin:

the, CFO helps me kind of

Erin Austin:

forecast, helps me think

Erin Austin:

about my business and,

Erin Austin:

things like that, which

Erin Austin:

is great resource to have.

Erin Austin:

So,

Erica Goode:

yes, absolutely.

Erica Goode:

So I would, yeah, I would say

Erica Goode:

the fractional CFO is usually

Erica Goode:

looking forward more than

Erica Goode:

they're looking backwards.

Erica Goode:

They need to look

Erica Goode:

backwards, but their focus

Erica Goode:

and their value comes

Erica Goode:

from looking forward.

Erin Austin:

Right.

Erin Austin:

So when, is somebody

Erin Austin:

ready for you?

Erica Goode:

I provide

Erica Goode:

different level of services

Erica Goode:

depending on where people are.

Erica Goode:

a lot of times I see people

Erica Goode:

come in around like the two

Erica Goode:

to 300, 000 revenue mark,

Erica Goode:

because they're having a lot

Erica Goode:

of questions around converting

Erica Goode:

to an S Corp and they

Erica Goode:

don't know what that means.

Erica Goode:

They don't know if that's

Erica Goode:

right for And they

Erica Goode:

don't want to, you know,

Erica Goode:

everybody's afraid of

Erica Goode:

doing the wrong thing and

Erica Goode:

getting arrested by the IRS.

Erica Goode:

The IRS will not

Erica Goode:

arrest you also.

Erica Goode:

So everything's going

Erica Goode:

to get arrested.

Erica Goode:

And they're

Erin Austin:

attached.

Erin Austin:

Jail or debtor

Erica Goode:

jail or

Erica Goode:

something like that.

Erica Goode:

There is for sure tax jail.

Erica Goode:

I would feel very confident

Erica Goode:

in saying the listeners of

Erica Goode:

this podcast are probably

Erica Goode:

trying to do the right thing.

Erica Goode:

And they're probably

Erica Goode:

never, ever, ever going

Erica Goode:

to get close to tax jail.

Erica Goode:

tax jail is reserved for

Erica Goode:

people who are purposefully

Erica Goode:

doing really bad things.

Erica Goode:

Well, they would

Erin Austin:

probably

Erin Austin:

at, scale, I imagine too.

Erica Goode:

Yes.

Erica Goode:

At scale.

Erica Goode:

Believe me, they deserve it.

Erica Goode:

You missing a couple of

Erica Goode:

deductions or putting in wrong

Erica Goode:

numbers on your tax return

Erica Goode:

will not land you in tax jail.

Erica Goode:

so yeah, I see people.

Erica Goode:

one point is I see them

Erica Goode:

usually at the two to

Erica Goode:

300, 000 mark when they

Erica Goode:

start wanting to look

Erica Goode:

forward in their business.

Erica Goode:

And when they're starting

Erica Goode:

to see significant growth

Erica Goode:

and scale and like that kind

Erica Goode:

of that click moment, like,

Erica Goode:

Oh, I figured this out.

Erica Goode:

Finally, after years

Erica Goode:

of, trying different

Erica Goode:

things and experimenting,

Erica Goode:

I figured this out.

Erica Goode:

And now I see that there

Erica Goode:

is I plan for it?

Erica Goode:

I think the best problem

Erica Goode:

that I get to solve is

Erica Goode:

I have money coming in.

Erica Goode:

What do I do with it?

Erica Goode:

Or how do I do

Erica Goode:

it the right way?

Erica Goode:

Or how do I save on

Erica Goode:

taxes the right way?

Erica Goode:

Or how do I invest in my

Erica Goode:

retirement the right way?

Erica Goode:

And so I always say I

Erica Goode:

get to solve the really

Erica Goode:

fun problems, right?

Erica Goode:

Having too much cash

Erica Goode:

is a fun problem.

Erica Goode:

Yes.

Erica Goode:

And we get to figure out

Erica Goode:

how to make more cash,

Erica Goode:

save more cash and invest

Erica Goode:

it in the right ways.

Erica Goode:

so that's one point and then

Erica Goode:

another point that people tend

Erica Goode:

to bring me in is when they've

Erica Goode:

created what is like an agency

Erica Goode:

or something where they have

Erica Goode:

a staff of people and they've

Erica Goode:

done very well and they've

Erica Goode:

been able to track things.

Erica Goode:

along the way, probably

Erica Goode:

until their first million

Erica Goode:

with their bookkeeper or

Erica Goode:

by themselves sometimes.

Erica Goode:

And then they get to

Erica Goode:

the point where cash is

Erica Goode:

flying in every direction.

Erica Goode:

We've got to make

Erica Goode:

payroll twice a week.

Erica Goode:

We're bringing in

Erica Goode:

invoices, but some of

Erica Goode:

them aren't getting paid.

Erica Goode:

How do I get those paid?

Erica Goode:

I can't miss payroll.

Erica Goode:

And we start to get these

Erica Goode:

really tens of thousands of

Erica Goode:

dollars in and out swings

Erica Goode:

on a weekly or biweekly

Erica Goode:

basis that can get really

Erica Goode:

nerve wracking if you don't

Erica Goode:

have a good visual into.

Erica Goode:

The plan for those and how

Erica Goode:

your cash flow is kind of

Erica Goode:

growing and fluctuating

Erica Goode:

as you run that business.

Erica Goode:

Yeah,

Erin Austin:

that's great.

Erin Austin:

Yeah.

Erin Austin:

The first example like

Erin Austin:

that was when I, cause

Erin Austin:

I've never, I haven't

Erin Austin:

done my taxes like ever.

Erin Austin:

I don't think so.

Erin Austin:

I've always used accountants.

Erin Austin:

For my taxes, but it wasn't

Erin Austin:

until kind of that flex point

Erin Austin:

that I brought in, someone

Erin Austin:

to kind of do financials,

Erin Austin:

which, brings us to, because

Erin Austin:

I never had financials before

Erin Austin:

that I just said, yeah, so,

Erin Austin:

so that brings us to our.

Erin Austin:

Topic today.

Erin Austin:

And so I'm excited about it

Erin Austin:

because I haven't been talking

Erin Austin:

on the exit side of the hourly

Erin Austin:

to exit journey for a while.

Erin Austin:

So we're going to talk

Erin Austin:

about that today and

Erin Austin:

about the financials that

Erin Austin:

will matter to a buyer.

Erin Austin:

But just starting from the

Erin Austin:

beginning, like, what do we

Erin Austin:

mean when we say financials?

Erica Goode:

Yeah.

Erica Goode:

So what I mean, at least

Erica Goode:

is, I mean, really simply

Erica Goode:

a balance sheet and, or a

Erica Goode:

profit and loss statement,

Erica Goode:

no matter where you are at

Erica Goode:

any point in your business,

Erica Goode:

you're going to need to do

Erica Goode:

those, whether you keep them

Erica Goode:

in a spreadsheet, there's

Erica Goode:

no shame in spreadsheet,

Erica Goode:

whether you keep them.

Erica Goode:

On a legal pad.

Erica Goode:

That's okay, too.

Erica Goode:

Like those financials

Erica Goode:

statements is always going

Erica Goode:

to be what feeds your taxes.

Erica Goode:

So whether you do it on your

Erica Goode:

own or you have an accountant

Erica Goode:

do your taxes, you're always

Erica Goode:

going to have to produce

Erica Goode:

some kind of financials.

Erica Goode:

And that's usually going

Erica Goode:

to be your balance sheet

Erica Goode:

and your profit and loss

Erica Goode:

statement at the very minimum

Erica Goode:

for every business owner in

Erica Goode:

whatever stage you're at.

Erin Austin:

Right.

Erin Austin:

And what is a

Erica Goode:

balance sheet?

Erica Goode:

Oh, thank you.

Erica Goode:

A balance sheet.

Erica Goode:

Yes, that's true.

Erica Goode:

A balance sheet tells

Erica Goode:

you what assets you have

Erica Goode:

and what debts you owe.

Erica Goode:

And so accountants

Erica Goode:

love to be in balance.

Erica Goode:

Balance sheets are called

Erica Goode:

a balance sheet because

Erica Goode:

they should balance your

Erica Goode:

assets are always going

Erica Goode:

to equal your debts plus

Erica Goode:

your equity in there.

Erica Goode:

And so I'm going to take it

Erica Goode:

out of business for a second.

Erica Goode:

Cause there's.

Erica Goode:

sometimes we're like, wow,

Erica Goode:

that's I don't even know what

Erica Goode:

my assets are in my business.

Erica Goode:

But when I think about

Erica Goode:

something very basic,

Erica Goode:

like, if you think, in

Erica Goode:

terms of owning your home.

Erica Goode:

Your home is your assets.

Erica Goode:

Let's say you have a 400,

Erica Goode:

000 home and you have a

Erica Goode:

300, 000 mortgage on it.

Erica Goode:

That means your asset is the

Erica Goode:

400, 000 thing, the home.

Erica Goode:

Your debt is the 300,

Erica Goode:

000 thing and your equity

Erica Goode:

in that is 100, 000.

Erica Goode:

And so the 400 equals the

Erica Goode:

300 plus the 100, right?

Erica Goode:

And it works the same

Erica Goode:

way with our business.

Erica Goode:

We have assets in our

Erica Goode:

business, and then we might

Erica Goode:

have debt in our business.

Erica Goode:

And the difference is the

Erica Goode:

equity or the value that we,

Erica Goode:

the owner have when we Pay

Erica Goode:

off the debts, basically.

Erin Austin:

All right.

Erin Austin:

I'm going to go

Erin Austin:

in this direction.

Erin Austin:

Just bear with me.

Erin Austin:

So, you know, I like to talk

Erin Austin:

about intellectual property

Erin Austin:

as being an asset in the

Erin Austin:

expertise based business,

Erin Austin:

but I don't think they show

Erin Austin:

up on the balance sheet.

Erin Austin:

Tell us how, what that

Erica Goode:

is.

Erica Goode:

Yes.

Erica Goode:

So that is really, so there's

Erica Goode:

some really nitty gritty

Erica Goode:

accounting that we won't go

Erica Goode:

into into depths of it can

Erica Goode:

show up on your balance sheet.

Erica Goode:

One of the ways it can

Erica Goode:

show up is if you buy that.

Erica Goode:

And so actually, when you're

Erica Goode:

talking about exiting, I

Erica Goode:

didn't know we were going

Erica Goode:

to go this direction.

Erica Goode:

You're really, making

Erica Goode:

me scratch my brain

Erica Goode:

for some really good

Erica Goode:

gap accounting here.

Erica Goode:

but this is good because

Erica Goode:

this is talking about exit.

Erica Goode:

So if you do have

Erica Goode:

intellectual property to you.

Erica Goode:

To me, the business owner,

Erica Goode:

if I have intellectual

Erica Goode:

property, it might not show

Erica Goode:

up on my balance sheet.

Erica Goode:

You're right.

Erica Goode:

But when it does show up on

Erica Goode:

a balance sheet is if a buyer

Erica Goode:

comes in and says, Ooh, I

Erica Goode:

see you have something of

Erica Goode:

value intellectual property.

Erica Goode:

I want to buy that from you.

Erica Goode:

now if the buyer pays money

Erica Goode:

for it, it is now an asset on

Erica Goode:

their balance sheet, right?

Erica Goode:

You're right.

Erica Goode:

It wasn't on the seller's

Erica Goode:

balance sheet as soon as

Erica Goode:

it gets sold and somebody

Erica Goode:

pays money for it.

Erica Goode:

Then it's an asset to them.

Erin Austin:

All right.

Erin Austin:

Well, that brings us to

Erin Austin:

the financials that buyers

Erin Austin:

like, and maybe there's

Erin Austin:

then the extras that aren't

Erin Austin:

quite on your financial

Erin Austin:

statement as a seller.

Erin Austin:

So, yeah, do you want to.

Erin Austin:

Anyplace you want to start

Erica Goode:

there?

Erica Goode:

let's jump into the

Erica Goode:

profit and loss statement.

Erica Goode:

We talked about balance sheet.

Erica Goode:

I think a buyer's before

Erica Goode:

anything, a buyer is.

Erica Goode:

Probably not going to care

Erica Goode:

about your balance sheet.

Erica Goode:

Your balance sheet is

Erica Goode:

your balance sheet.

Erica Goode:

Whatever you owe

Erica Goode:

in your business is

Erica Goode:

literally your business.

Erica Goode:

They're likely not going

Erica Goode:

to take on debt, from you.

Erica Goode:

And so what a buyer is

Erica Goode:

really going to care about

Erica Goode:

is what's happening on your

Erica Goode:

profit and loss statement.

Erica Goode:

And more importantly, what's

Erica Goode:

going to happen in your

Erica Goode:

profit and loss statement.

Erica Goode:

And so what you have,

Erica Goode:

every business owner

Erica Goode:

is going to have what

Erica Goode:

happened in the past.

Erica Goode:

What they want to see

Erica Goode:

is probably what's

Erica Goode:

going to happen in the

Erica Goode:

next five to 10 years.

Erica Goode:

They're going to care a

Erica Goode:

lot about your revenue.

Erica Goode:

They're going to care a

Erica Goode:

lot about your profit, and

Erica Goode:

they're going to care a lot

Erica Goode:

about the difference between

Erica Goode:

those every year going

Erica Goode:

forward or your trend lines.

Erica Goode:

And so they want to know if

Erica Goode:

you're increasing in revenue,

Erica Goode:

how fast you're increasing

Erica Goode:

in revenue, and what it

Erica Goode:

takes to increase that from

Erica Goode:

like an expense standpoint.

Erica Goode:

So they're going to

Erica Goode:

worry about how fast that

Erica Goode:

trend is moving in profit

Erica Goode:

and revenue and what

Erica Goode:

it takes to get there.

Erica Goode:

Because if you've set up

Erica Goode:

your business, so they care,

Erica Goode:

they're going to look at

Erica Goode:

what happened in the past.

Erica Goode:

You've created this business.

Erica Goode:

It's hopefully moving

Erica Goode:

in an upward into the

Erica Goode:

right direction, right

Erica Goode:

up into the right.

Erica Goode:

That's what everybody wants

Erica Goode:

to see up into the right.

Erica Goode:

And it's moving at

Erica Goode:

a scalable clip.

Erica Goode:

But if it's taking expenses.

Erica Goode:

And it's degrading

Erica Goode:

profit, right?

Erica Goode:

that's what a

Erica Goode:

buyer cares about.

Erica Goode:

They care that they're

Erica Goode:

going to be able to take

Erica Goode:

by that business and make

Erica Goode:

more money and more profit

Erica Goode:

every year in the future.

Erica Goode:

And so couple of really

Erica Goode:

important things is, your

Erica Goode:

financials matter because

Erica Goode:

we care that they're

Erica Goode:

accurate in the past.

Erica Goode:

That they're very accurate

Erica Goode:

in the past because that's

Erica Goode:

what's going to feed your

Erica Goode:

forecast in the future.

Erica Goode:

And we care that when

Erica Goode:

you talked about having

Erica Goode:

a fractional CFO, that

Erica Goode:

the person helping you

Erica Goode:

build out that forecast is

Erica Goode:

really keenly aware of how

Erica Goode:

your business operates.

Erica Goode:

Because you can

Erica Goode:

have an example of.

Erica Goode:

Maybe you're building a

Erica Goode:

business and it does take in

Erica Goode:

year 1 and 2 a lot of expenses

Erica Goode:

to stand up what you're doing.

Erica Goode:

But those expenses are

Erica Goode:

1 time costs, and maybe

Erica Goode:

they're not going to be

Erica Goode:

there in year 3 through 8.

Erica Goode:

Right?

Erica Goode:

And so you care very

Erica Goode:

much that the person

Erica Goode:

helping you build your

Erica Goode:

forecast understands that.

Erica Goode:

Those expenses are one

Erica Goode:

time things and they're not

Erica Goode:

projecting them into the

Erica Goode:

future and that's where the

Erica Goode:

buyer is going to see values.

Erica Goode:

You've built up and created

Erica Goode:

this thing and now it's

Erica Goode:

going to run at a much

Erica Goode:

better operating margin.

Erica Goode:

Now,

Erin Austin:

if I'm thinking

Erin Austin:

about selling my business,

Erin Austin:

take us to like the T minus.

Erin Austin:

three years, five years.

Erin Austin:

okay, I want to sell

Erin Austin:

my business in 2025.

Erin Austin:

Well, it's too late now.

Erin Austin:

If I wanted to start

Erin Austin:

that was let's say 2030.

Erin Austin:

when do I need to start

Erin Austin:

thinking as a seller, as

Erin Austin:

opposed to just an operator

Erin Austin:

or maybe they're the same.

Erica Goode:

Oh, I think,

Erica Goode:

they can be the same.

Erica Goode:

here's why I think

Erica Goode:

that because.

Erica Goode:

a business that somebody

Erica Goode:

else is going to see as very

Erica Goode:

valuable is now currently

Erica Goode:

also very valuable to you.

Erica Goode:

what a buyer thinks is

Erica Goode:

valuable is something that's

Erica Goode:

going to kick off a lot of

Erica Goode:

profit and a lot of cash

Erica Goode:

relatively easily because it

Erica Goode:

has a solid operating system

Erica Goode:

behind it, know, processes

Erica Goode:

and it's running efficiently.

Erica Goode:

It doesn't take just.

Erica Goode:

Me as the seller to

Erica Goode:

operate it and to push all

Erica Goode:

the buttons every single

Erica Goode:

minute of every single day.

Erica Goode:

And so in essence, if you're

Erica Goode:

building something that's

Erica Goode:

going to look very attractive

Erica Goode:

to a buyer, you've built

Erica Goode:

something that is already

Erica Goode:

very valuable to you, it's

Erica Goode:

already kicking off profit.

Erica Goode:

It's already making a good

Erica Goode:

cashflow and it's relatively.

Erica Goode:

quote, easy to run

Erica Goode:

without you, or at

Erica Goode:

least you specifically

Erin Austin:

somewhat

Erin Austin:

independent from you.

Erin Austin:

Exactly.

Erin Austin:

Yeah.

Erin Austin:

and so what about if,

Erin Austin:

I'm trying to pay myself

Erin Austin:

kind of nothing so I can

Erin Austin:

keep cash in the business

Erin Austin:

and keep growing it.

Erin Austin:

Like, how will the seller

Erin Austin:

buyer look at that?

Erica Goode:

So cash in the

Erica Goode:

business is we kind of always

Erica Goode:

have lots of questions around.

Erica Goode:

and I'm going to go

Erica Goode:

into taxes for a second.

Erica Goode:

Do I get taxed on the

Erica Goode:

money that I take out of

Erica Goode:

the business or do I get

Erica Goode:

taxed on any money that

Erica Goode:

the business generates?

Erica Goode:

Right.

Erica Goode:

And so there's this,

Erica Goode:

sometimes there's this

Erica Goode:

misnomer that like, if I

Erica Goode:

keep money in the business,

Erica Goode:

I don't pay tax on it.

Erica Goode:

usually I would guess the

Erica Goode:

listeners of this podcast are

Erica Goode:

either an LLC or an S corp.

Erica Goode:

They're probably not a C corp.

Erica Goode:

So you're going to pay tax

Erica Goode:

on anything that is just

Erica Goode:

revenue minus your expenses.

Erica Goode:

Is your profit, it's

Erica Goode:

also going to be what the

Erica Goode:

potential buyer cares about.

Erica Goode:

They don't care whether you

Erica Goode:

took money out of the profit

Erica Goode:

to pay yourself or you didn't.

Erica Goode:

In essence, that cash isn't

Erica Goode:

going to be there's anyways,

Erica Goode:

like you've earned that cash.

Erica Goode:

You're going to walk away with

Erica Goode:

that cash when you sell it.

Erica Goode:

What they care about is

Erica Goode:

that profit line item.

Erica Goode:

And so as the.

Erica Goode:

Seller, if you are

Erica Goode:

generating a lot of cash

Erica Goode:

and you can pay yourself.

Erica Goode:

By all means pay yourself,

Erica Goode:

but if there's a reason that

Erica Goode:

you want to keep that cash

Erica Goode:

in the business, because you

Erica Goode:

think that that helps you

Erica Goode:

build or grow something that

Erica Goode:

in the future is going to be

Erica Goode:

valuable, then by all means,

Erica Goode:

if that's your purpose, do it.

Erica Goode:

I wouldn't say keep

Erica Goode:

money, never keep

Erica Goode:

money in your business.

Erica Goode:

Sometimes I get people like

Erica Goode:

it's December, how much

Erica Goode:

money should I spend so I

Erica Goode:

can reduce my tax burden?

Erica Goode:

And I always say.

Erica Goode:

You should spend 0 if

Erica Goode:

you don't have to, right?

Erica Goode:

Like, we should never

Erica Goode:

be spending 1 to save 0.

Erica Goode:

30.

Erica Goode:

Oh, yeah.

Erica Goode:

It's the same thing.

Erica Goode:

Yes, and I think there's

Erica Goode:

a misnomer out there that,

Erica Goode:

like, I need to spend

Erica Goode:

something in December so I

Erica Goode:

can save on my taxes, but.

Erica Goode:

We should never be

Erica Goode:

spending money that

Erica Goode:

doesn't need to be spent.

Erica Goode:

I would rather you take

Erica Goode:

home a dollar and pay

Erica Goode:

30 cents on tax on it.

Erica Goode:

Than take home 70 and

Erica Goode:

then pay tax on that.

Erin Austin:

It was

Erin Austin:

going to be, you're going

Erin Austin:

to buy it in January.

Erin Austin:

Like, okay, right.

Erin Austin:

Right.

Erin Austin:

Right.

Erica Goode:

and so

Erica Goode:

I'd be very careful.

Erica Goode:

Keep money in your business.

Erica Goode:

If you think that you

Erica Goode:

can spend it in a way

Erica Goode:

that's going to make your

Erica Goode:

price tag later higher.

Erin Austin:

it's

Erin Austin:

an investment.

Erin Austin:

Like, you're waiting maybe

Erin Austin:

to make capital investments

Erin Austin:

and things like that.

Erin Austin:

Yeah.

Erin Austin:

So if I underpay myself.

Erin Austin:

Does that not increase, like,

Erin Austin:

what looks like profit, even

Erin Austin:

though it really isn't because

Erin Austin:

they would have to pay someone

Erin Austin:

the market rate in order to

Erica Goode:

replace me.

Erica Goode:

Right.

Erica Goode:

So there's 2 ways

Erica Goode:

to pay yourself.

Erica Goode:

let's assume you're an S corp.

Erica Goode:

Somebody listened to this

Erica Goode:

is probably an S corp.

Erica Goode:

you probably are on the

Erica Goode:

books having a salary.

Erica Goode:

you always want to pay

Erica Goode:

yourself a reasonable rate.

Erica Goode:

and the IRS requires,

Erica Goode:

they call it a

Erica Goode:

reasonable compensation.

Erica Goode:

You have to pay yourself

Erica Goode:

what you would pay somebody

Erica Goode:

else to do the work for

Erica Goode:

you if you wanted to sit

Erica Goode:

and sip coffee all day.

Erica Goode:

Right.

Erica Goode:

And so, really like the

Erica Goode:

underpaying yourself.

Erica Goode:

shouldn't be an option.

Erica Goode:

Now, if you want to take less

Erica Goode:

distributions outside of that,

Erica Goode:

that's actually still not

Erica Goode:

going to make a difference

Erica Goode:

to your profit at the end of

Erica Goode:

the day because your owner

Erica Goode:

distributions aren't a part

Erica Goode:

of your profit and loss

Erica Goode:

statement, just your salary.

Erin Austin:

Oh, okay.

Erin Austin:

Okay.

Erin Austin:

All right.

Erin Austin:

That makes sense.

Erin Austin:

And then what are the, I mean,

Erin Austin:

have you taken someone like

Erin Austin:

done someone's books as they

Erin Austin:

were exiting a business and

Erica Goode:

I haven't

Erica Goode:

gone through the exit.

Erica Goode:

our exit plan is.

Erica Goode:

To exit in the next 5 years.

Erica Goode:

So let's make sure we're a

Erica Goode:

doing all of this accurately.

Erica Goode:

So somebody can't come

Erica Goode:

in and be like, well,

Erica Goode:

what's this number?

Erica Goode:

Like, always be

Erica Goode:

prepared for an audit.

Erica Goode:

Like, if you're prepared

Erica Goode:

for an IRS audit, you're

Erica Goode:

going to be prepared for

Erica Goode:

somebody to come in and

Erica Goode:

look at your books during

Erica Goode:

a due diligence process.

Erica Goode:

yeah, we've, gone through

Erica Goode:

the process of getting.

Erica Goode:

Investors and also, being

Erica Goode:

prepared for if somebody

Erica Goode:

comes knocking, we're

Erica Goode:

ready to tell you how

Erica Goode:

much this thing is worth.

Erin Austin:

And when a deal

Erin Austin:

falls through because of

Erin Austin:

the due diligence process,

Erin Austin:

like what are typically

Erin Austin:

like, what went wrong?

Erica Goode:

Oh, I'm

Erica Goode:

definitely not an expert

Erica Goode:

or a broker in the

Erica Goode:

due diligence process.

Erica Goode:

My guess would be that,

Erica Goode:

something looked rosier than.

Erica Goode:

It was proposed to be

Erica Goode:

that it was actually, and,

Erica Goode:

due diligence is somebody

Erica Goode:

comes in and starts asking

Erica Goode:

all of the questions.

Erica Goode:

They start nitpicking

Erica Goode:

everything, which is a

Erica Goode:

hard process to go through.

Erica Goode:

Right.

Erica Goode:

And, that is the

Erica Goode:

nature of the process.

Erica Goode:

And You've maybe said, oh,

Erica Goode:

we're at a 50 percent margin.

Erica Goode:

And so they're going to dig

Erica Goode:

into who are your contracts?

Erica Goode:

what makes those up?

Erica Goode:

How long are those?

Erica Goode:

How easy are those to

Erica Goode:

get when they expire?

Erica Goode:

And then somebody is going to

Erica Goode:

dig into all your expenses.

Erica Goode:

And if after they

Erica Goode:

do all that digging.

Erica Goode:

Cause what they're doing,

Erica Goode:

they're trying to poke

Erica Goode:

holes in your forecast.

Erica Goode:

And so if they poke holes

Erica Goode:

in that and they're like,

Erica Goode:

wait, you said you're going

Erica Goode:

to grow at 30 percent revenue

Erica Goode:

for the next five years,

Erica Goode:

year on year, every year.

Erica Goode:

I don't know how that's

Erica Goode:

possible based on

Erica Goode:

what I'm seeing today.

Erica Goode:

That's what they're trying

Erica Goode:

to kind of poke holes into.

Erica Goode:

And so that's where like.

Erica Goode:

We can all make up a forecast.

Erica Goode:

Any CFO can make up a forecast

Erica Goode:

that looks real great.

Erica Goode:

but the moment somebody starts

Erica Goode:

poking holes in it and can't

Erica Goode:

get to the same numbers that

Erica Goode:

you did, that's where a due

Erica Goode:

diligence process would start.

Erica Goode:

imagine, breaking down and

Erica Goode:

a buyer would either walk

Erica Goode:

or say, I still want it, but

Erica Goode:

at a very different price.

Erin Austin:

Right.

Erin Austin:

Right.

Erin Austin:

That's when the

Erin Austin:

retraining, I guess the

Erin Austin:

term is starts, right?

Erin Austin:

Yes.

Erin Austin:

So if somebody's thinking

Erin Austin:

about, they want to sell

Erin Austin:

their business someday,

Erin Austin:

that's why we're here.

Erin Austin:

Like what, something that

Erin Austin:

they can do today with or

Erin Austin:

without a CFO's assistance

Erin Austin:

that can help them kind

Erin Austin:

of get on the right path.

Erica Goode:

I don't

Erica Goode:

think it's ever wasted

Erica Goode:

time to sit down.

Erica Goode:

In a spreadsheet of your

Erica Goode:

own and start forecasting

Erica Goode:

out what the future of

Erica Goode:

your business looks like

Erica Goode:

or what it could look like.

Erica Goode:

and it doesn't have to be a

Erica Goode:

really nitty gritty process.

Erica Goode:

I think sometimes we

Erica Goode:

can hear words like that

Erica Goode:

and be like, oh, I don't

Erica Goode:

know how to do that.

Erica Goode:

I wouldn't even

Erica Goode:

know where to start.

Erica Goode:

It's really just, open

Erica Goode:

up a spreadsheet and

Erica Goode:

say, this is what I think

Erica Goode:

this year will look like.

Erica Goode:

Here's what I think.

Erica Goode:

Okay.

Erica Goode:

The next five years could

Erica Goode:

look like and from a

Erica Goode:

revenue standpoint, and

Erica Goode:

then what would it take

Erica Goode:

from an expense standpoint?

Erica Goode:

Like, is that going

Erica Goode:

to cost me money?

Erica Goode:

Is that going to make

Erica Goode:

me hire somebody?

Erica Goode:

And what does that

Erica Goode:

do to my margin?

Erica Goode:

And it can be very high level,

Erica Goode:

but it starts to get your.

Erica Goode:

Yeah.

Erica Goode:

brain working in that

Erica Goode:

future direction.

Erica Goode:

If you've only ever really

Erica Goode:

looked through the past for

Erica Goode:

tax purposes, it'll start

Erica Goode:

making you thinking, wow,

Erica Goode:

why would a buyer want this?

Erica Goode:

Or what would a buyer want?

Erica Goode:

And how can I

Erica Goode:

make that happen?

Erin Austin:

That's

Erin Austin:

great advice.

Erin Austin:

Like just thinking

Erin Austin:

about, looking back, like

Erin Austin:

starting out there and what

Erin Austin:

resources are required.

Erin Austin:

To get there and start

Erin Austin:

thinking about it that way,

Erin Austin:

as opposed to, like, instead

Erin Austin:

of pushing up the Hill, like,

Erin Austin:

how do you pull yourself

Erin Austin:

up to where you want to be?

Erin Austin:

I like that.

Erin Austin:

Yeah,

Erica Goode:

There's a lot

Erica Goode:

of times where, as business

Erica Goode:

owners, especially as excited

Erica Goode:

business owners, I hear

Erica Goode:

things like, okay, well,

Erica Goode:

we're going to increase

Erica Goode:

revenue by 100, 000 dollars

Erica Goode:

in this next 2 months.

Erica Goode:

And I'm like, great.

Erica Goode:

Are you going to have

Erica Goode:

to hire to do that to

Erica Goode:

complete those contracts?

Erica Goode:

And it kind of stops.

Erica Goode:

I'm like, oh.

Erica Goode:

yeah, I guess I will.

Erica Goode:

So your, 100, 000 of

Erica Goode:

profit really is maybe

Erica Goode:

more like, 70, 000.

Erica Goode:

And that's, well,

Erica Goode:

if you need to

Erin Austin:

hire an

Erin Austin:

expert, then yeah.

Erin Austin:

What does that mean?

Erica Goode:

Yeah.

Erica Goode:

Which is fine.

Erica Goode:

That doesn't mean

Erica Goode:

it's a bad thing.

Erica Goode:

That doesn't mean don't do it.

Erica Goode:

That just means take both

Erica Goode:

sides into consideration.

Erin Austin:

so I usually

Erin Austin:

ask about, trends in

Erin Austin:

someone's area and I don't

Erin Austin:

know, are there trends in

Erica Goode:

accounting?

Erica Goode:

Financial or, qualitative?

Erin Austin:

either

Erica Goode:

one.

Erica Goode:

right now the trend in

Erica Goode:

the accounting space that

Erica Goode:

everybody is paying attention

Erica Goode:

to is the, shortage of CPAs

Erica Goode:

and accountants in our space.

Erica Goode:

Yes.

Erica Goode:

is, and it is very well known

Erica Goode:

In the industry, but if you

Erica Goode:

are outside of the industry,

Erica Goode:

I don't think people realize

Erica Goode:

that there is, a shortage.

Erica Goode:

I believe there is a crazy

Erica Goode:

statistic that says something

Erica Goode:

like in the next 10 years, 75

Erica Goode:

percent of CPAs will retire.

Erica Goode:

And they're not coming in at

Erica Goode:

the same clip that they're

Erica Goode:

retiring at this point.

Erica Goode:

And so I would be shocked

Erica Goode:

if somebody listening to

Erica Goode:

this had not had an issue.

Erica Goode:

If they'd gone out looking

Erica Goode:

for a CPA recently, a new

Erica Goode:

one had an issue finding one.

Erica Goode:

because even inside the

Erica Goode:

industry, if I'm trying to

Erica Goode:

refer somebody, I cannot find

Erica Goode:

somebody to refer you to.

Erin Austin:

That

Erin Austin:

is so interesting.

Erin Austin:

So why is it just not the hot.

Erin Austin:

Major anymore, what's

Erin Austin:

going on there?

Erica Goode:

Oh,

Erica Goode:

a deep answer.

Erica Goode:

The deep answer.

Erica Goode:

I think This is my opinion.

Erica Goode:

So don't, don't, you know, if

Erica Goode:

you, there's a lot of people

Erica Goode:

giving this quote though.

Erica Goode:

So, I think it's been a

Erica Goode:

very, I'm trying to speak

Erica Goode:

kindly to my industry.

Erica Goode:

there are long hours.

Erica Goode:

There can be very long

Erica Goode:

hours in accounting and, the

Erica Goode:

burnout rate is very high and

Erica Goode:

accountants are notoriously

Erica Goode:

also bad at pricing.

Erica Goode:

And so you get This funny

Erica Goode:

squeeze where, accounting

Erica Goode:

firms aren't making enough

Erica Goode:

margin and they're treating

Erica Goode:

their employees poorly

Erica Goode:

because they have to get

Erica Goode:

their contracts completed.

Erica Goode:

And so you have

Erica Goode:

this burnout and.

Erica Goode:

I can imagine if I am a

Erica Goode:

college student thinking about

Erica Goode:

majoring in accounting and I

Erica Goode:

ask 10 CPAs who have been in

Erica Goode:

public accounting, they're not

Erica Goode:

going to say necessarily kind

Erica Goode:

things about how their work

Erica Goode:

life balance has been, which

Erica Goode:

will not motivate anybody

Erica Goode:

to go into the industry.

Erica Goode:

And so I think.

Erica Goode:

There's a lot of things

Erica Goode:

playing in to the industry,

Erica Goode:

but it's not an attractive,

Erica Goode:

work life balance in

Erica Goode:

the traditional sense.

Erica Goode:

There's a lot of, younger

Erica Goode:

accountants who are changing

Erica Goode:

the industry, but it takes

Erica Goode:

a while to turn a ship.

Erica Goode:

And so we are slowly moving

Erica Goode:

in the right direction, but I

Erica Goode:

think right now there is a lot

Erica Goode:

of old schools of thought and

Erica Goode:

traditional ways of running

Erica Goode:

firms that does not appear

Erica Goode:

to be attractive to new up

Erica Goode:

and coming college graduates.

Erica Goode:

Are

Erin Austin:

you mentoring

Erin Austin:

young accountants to kind

Erin Austin:

of have a different business

Erin Austin:

model than billing hourly.

Erica Goode:

I'm

Erica Goode:

trying to figure out

Erica Goode:

my own way of doing it.

Erica Goode:

and then we'll see if

Erica Goode:

I can pass along the

Erica Goode:

knowledge the next.

Erica Goode:

generation, but gosh, I

Erica Goode:

mean, I see those young

Erica Goode:

kids and there are people

Erica Goode:

who should be accountants.

Erica Goode:

Like that sounds like a

Erica Goode:

funny thing, but there are

Erica Goode:

personalities and the way

Erica Goode:

certain brains work that

Erica Goode:

they should be accountants.

Erica Goode:

And I would hate for them.

Erica Goode:

I would hate for our society

Erica Goode:

to lose that because of just.

Erica Goode:

Inefficient and poor

Erica Goode:

work life balance,

Erin Austin:

and everyone

Erin Austin:

can't be a computer engineer

Erin Austin:

or, whatever the hot, hot

Erin Austin:

things are now that, yeah,

Erin Austin:

we need professionals

Erin Austin:

all across the board.

Erin Austin:

So, all right.

Erica Goode:

Absolutely.

Erica Goode:

And we need to treat

Erica Goode:

our people well and

Erica Goode:

across every industry.

Erica Goode:

We people should be

Erica Goode:

treated like people.

Erica Goode:

Well, I would

Erin Austin:

imagine

Erin Austin:

the market will correct

Erin Austin:

itself at some point.

Erin Austin:

Like, if you can't recruit

Erin Austin:

and retain talent, then you

Erin Austin:

need to change something.

Erin Austin:

Right.

Erin Austin:

And, certainly,

Erin Austin:

our people working

Erin Austin:

remotely, like, is that.

Erica Goode:

Yeah, it's

Erica Goode:

starting and so what I imagine

Erica Goode:

will happen is the people who

Erica Goode:

are running traditional firms

Erica Goode:

with old schools of thought

Erica Goode:

they will have an extremely

Erica Goode:

hard recruiting process and

Erica Goode:

the up and coming firms who

Erica Goode:

have very progressive new

Erica Goode:

ways of thinking will easily

Erica Goode:

recruit people and you will

Erica Goode:

just see this shift of.

Erica Goode:

Market share move towards the

Erica Goode:

progressive thinking firms.

Erin Austin:

Yeah, and

Erin Austin:

similar things happening

Erin Austin:

in the legal industry.

Erin Austin:

I will say I'm pretty far

Erin Austin:

removed from it at this

Erin Austin:

point, I mean, I haven't

Erin Austin:

been in a law firm and God,

Erin Austin:

don't even know a very long

Erin Austin:

time, but the different

Erin Austin:

kinds of firms that are.

Erin Austin:

virtual and have kind of,

Erin Austin:

independent partners, people

Erin Austin:

who have their own firms,

Erin Austin:

but then come together

Erin Austin:

under 1 brand to market

Erin Austin:

their services together.

Erin Austin:

they don't have the same and

Erin Austin:

you can work as hard as you

Erin Austin:

want to, and have a little

Erin Austin:

more, balance in their lives.

Erin Austin:

yeah, I mean, the

Erin Austin:

burnout in the legal.

Erin Austin:

Industry is, hasn't changed.

Erica Goode:

think, I think

Erica Goode:

lawyers and accountants, run

Erica Goode:

very similarly run businesses

Erica Goode:

and business models.

Erica Goode:

And I think it'd suit us

Erica Goode:

all for those industries

Erica Goode:

to think differently.

Erica Goode:

Yes,

Erin Austin:

absolutely.

Erin Austin:

Absolutely.

Erin Austin:

Well, you know, this is

Erin Austin:

the hourly to exit podcast.

Erin Austin:

You know, we were

Erin Austin:

talking about building

Erin Austin:

a scalable and saleable

Erin Austin:

expertise based business.

Erin Austin:

And so I have, of

Erin Austin:

course, the soft spot for

Erin Austin:

creating, and protecting

Erin Austin:

intellectual property.

Erin Austin:

So when you are working with

Erin Austin:

expertise based businesses,

Erin Austin:

and they work with their

Erin Austin:

intellect, do you ever

Erin Austin:

come across challenges?

Erin Austin:

We talked a little

Erin Austin:

bit about it.

Erin Austin:

Like the fact that we

Erin Austin:

can't put those assets

Erin Austin:

on our balance sheets.

Erin Austin:

but do they have, other

Erin Austin:

issues that come up regarding

Erin Austin:

protecting their intellectual

Erin Austin:

property and what kind of

Erin Austin:

questions do they ask you?

Erin Austin:

I imagine they ask you

Erin Austin:

about, how to value it.

Erica Goode:

I think a lot

Erica Goode:

of, what I see my, clients

Erica Goode:

deal with is creating

Erica Goode:

the processes around

Erica Goode:

and like the frameworks.

Erica Goode:

It's always about framework.

Erica Goode:

And I don't think, whether

Erica Goode:

you're an IT, I have.

Erica Goode:

It marketing, coaching,

Erica Goode:

like all these different,

Erica Goode:

you know, it is all

Erica Goode:

intellectual property.

Erica Goode:

but I don't think they

Erica Goode:

and we always see it as I.

Erica Goode:

P.

Erica Goode:

I think, sometimes until

Erica Goode:

we've been educated,

Erica Goode:

we have very narrow.

Erica Goode:

Minds about what IP is, and I

Erica Goode:

think we grossly underestimate

Erica Goode:

that the things we are

Erica Goode:

creating and the things my

Erica Goode:

clients are creating, the

Erica Goode:

frameworks, the processes,

Erica Goode:

the platforms, like these

Erica Goode:

are all very saleable and

Erica Goode:

transferable ideas and

Erica Goode:

things that they're building.

Erica Goode:

And I honestly don't see

Erica Goode:

somebody coming alongside

Erica Goode:

them from a legal standpoint.

Erica Goode:

Calling that out for them.

Erica Goode:

I'm not sure that we always

Erica Goode:

know to do that when we're

Erica Goode:

creating these things

Erica Goode:

because we don't see them

Erica Goode:

as IP from that side.

Erica Goode:

Yeah, I like,

Erin Austin:

you know, of

Erin Austin:

course, I'd like to say that

Erin Austin:

is everywhere because every

Erin Austin:

time we're using our intellect

Erin Austin:

where you are creating

Erin Austin:

intellectual property and then

Erin Austin:

it's not just those things

Erin Austin:

that we are selling like.

Erin Austin:

Books and courses

Erin Austin:

and software.

Erin Austin:

It's also the things that

Erin Austin:

we use internally in our

Erin Austin:

businesses to help create

Erin Austin:

leverages in our businesses.

Erin Austin:

So absolutely.

Erin Austin:

I love that.

Erin Austin:

All right.

Erin Austin:

So we know this is

Erin Austin:

a very meta podcast.

Erin Austin:

I'm a female founder of an

Erin Austin:

expertise based business

Erin Austin:

that I hope to sell someday.

Erin Austin:

You are the female founder of

Erin Austin:

an expertise based business.

Erin Austin:

Are you thinking about

Erin Austin:

selling it someday?

Erica Goode:

Not at this time.

Erica Goode:

I am in a season of life.

Erica Goode:

We talked in the

Erica Goode:

green room beforehand.

Erica Goode:

We talked about the

Erica Goode:

ages of our kids.

Erica Goode:

I have a 12 year

Erica Goode:

and an 8 year old.

Erica Goode:

And so right now, I am pretty

Erica Goode:

focused on getting these

Erica Goode:

little people grown up and

Erica Goode:

running a business that just.

Erica Goode:

is truly like a lifestyle

Erica Goode:

suited for me business.

Erica Goode:

And so my goal today, I don't

Erica Goode:

have selling on the mind.

Erica Goode:

that doesn't mean that it

Erica Goode:

couldn't be in the future.

Erica Goode:

I don't have a finish

Erica Goode:

line that I'm racing to.

Erica Goode:

I enjoy what I do.

Erica Goode:

I want to keep doing it.

Erica Goode:

yeah.

Erica Goode:

Yeah.

Erica Goode:

This doesn't mean

Erica Goode:

it won't change.

Erin Austin:

I'm

Erin Austin:

with you on that.

Erin Austin:

We did talk.

Erin Austin:

I have a senior and I

Erin Austin:

am racing to the finish

Erin Austin:

line for that anyway.

Erin Austin:

but like you, like when

Erin Austin:

my son was young, like My

Erin Austin:

business was very lifestyle.

Erin Austin:

It was very much

Erin Austin:

like, I did not do any

Erin Austin:

business development.

Erin Austin:

It was just like, I

Erin Austin:

had my well clients.

Erin Austin:

That was it, you and

Erin Austin:

then, I had, I could

Erin Austin:

focus on other things.

Erin Austin:

and now that he's

Erin Austin:

pseudo independent.

Erin Austin:

I was starting to, like

Erin Austin:

put way more energy into

Erin Austin:

my business and, things

Erin Austin:

that I've been doing the

Erin Austin:

last couple of years.

Erin Austin:

and so there is a season,

Erin Austin:

yeah, for all of our

Erin Austin:

businesses that go along

Erin Austin:

with our lives, but certainly

Erin Austin:

when we are soloist women.

Erin Austin:

and so, yeah, I, I, agreed

Erin Austin:

with you there and, the funny

Erin Austin:

thing about retirement and

Erin Austin:

I guess maybe I think of

Erin Austin:

retirement almost as like

Erin Austin:

a employee kind of thing,

Erin Austin:

as opposed to a business

Erin Austin:

owner kind of thing, you

Erin Austin:

know, assuming you've

Erin Austin:

created a business that you

Erin Austin:

love, to me, focus on, it's

Erin Austin:

not retirement, but just.

Erin Austin:

Relaxing, you know,

Erin Austin:

like having less intense

Erin Austin:

needs in my business, but

Erin Austin:

creating those revenue

Erin Austin:

streams that require less

Erin Austin:

and less of made to me.

Erin Austin:

That is retirement.

Erin Austin:

And that's what, I'm working

Erica Goode:

on.

Erica Goode:

So I think that's such a

Erica Goode:

good call out because I

Erica Goode:

think so much of society

Erica Goode:

has this W 2 employee

Erica Goode:

mindset of retirement.

Erica Goode:

Like I turned this

Erica Goode:

age and I'm done.

Erica Goode:

And out of corporate, coming

Erica Goode:

out of burnout, like what

Erica Goode:

if we just created work for

Erica Goode:

ourselves that we enjoyed

Erica Goode:

that didn't kill us, right?

Erica Goode:

Like, what if we enjoyed every

Erica Goode:

day what we did and we weren't

Erica Goode:

so desperate to retire?

Erica Goode:

What would that look like?

Erica Goode:

And I, like that idea.

Erica Goode:

But you're right.

Erica Goode:

It's not something that we

Erica Goode:

think about creating until

Erica Goode:

we've left that W two mindset.

Erica Goode:

Right?

Erin Austin:

Absolutely.

Erin Austin:

Absolutely.

Erin Austin:

Yeah.

Erin Austin:

I mean, and you need

Erin Austin:

to do something.

Erin Austin:

I mean, assuming we're healthy

Erin Austin:

and our minds still work,

Erin Austin:

you know, and we have like,

Erin Austin:

what are you going to do?

Erin Austin:

I don't get what people

Erin Austin:

do after they retire.

Erin Austin:

I don't know.

Erin Austin:

Maybe.

Erin Austin:

I don't know.

Erin Austin:

I'm going to do what they do.

Erica Goode:

I don't know.

Erica Goode:

I'm going to need to

Erica Goode:

do something because

Erica Goode:

I don't sit well.

Erin Austin:

All right.

Erin Austin:

So as we wrap up, know, we

Erin Austin:

believe in creating a more

Erin Austin:

equitable society and we love

Erin Austin:

to support businesses and

Erin Austin:

organizations that, work, to

Erin Austin:

help us women in particular.

Erin Austin:

And so is there a organization

Erin Austin:

that you'd like to share

Erica Goode:

with

Erica Goode:

the audience?

Erica Goode:

So I have a cause not a

Erica Goode:

particular organization since

Erica Goode:

day one of building this

Erica Goode:

business, I have donated 10

Erica Goode:

percent of my salary and the

Erica Goode:

profits of this business to

Erica Goode:

domestic violence shelters.

Erica Goode:

But because domestic

Erica Goode:

I think the solution.

Erica Goode:

And what do I know,

Erica Goode:

leave it to the experts

Erica Goode:

but the solution to so

Erica Goode:

much domestic violence.

Erica Goode:

problems is so local that

Erica Goode:

my money, the causes that

Erica Goode:

we donate to are specific

Erica Goode:

to the local areas where

Erica Goode:

our clients are located.

Erica Goode:

I'm a virtual business.

Erica Goode:

I have clients all over the U.

Erica Goode:

S.

Erica Goode:

So, 10 percent goes back

Erica Goode:

to those cities, domestic

Erica Goode:

shelters in the cities where

Erica Goode:

my clients are located.

Erica Goode:

this is not a

Erica Goode:

chain restaurant.

Erica Goode:

These are people on the ground

Erica Goode:

in the cities, wherever you're

Erica Goode:

living that are building up

Erica Goode:

these organizations to help

Erica Goode:

women and men and children of

Erica Goode:

domestic violence situations.

Erica Goode:

And so those are very, located

Erica Goode:

all over the United States.

Erica Goode:

And so.

Erica Goode:

I get to actually search

Erica Goode:

out these organizations

Erica Goode:

and it's like my favorite

Erica Goode:

thing to do in December.

Erica Goode:

I get my card out, you know,

Erica Goode:

my debit card out and I

Erica Goode:

start, you looking up all of

Erica Goode:

these organizations that I've

Erica Goode:

now donated to for years.

Erica Goode:

And funny thing

Erica Goode:

happens every December.

Erica Goode:

the bank shuts down my card

Erica Goode:

on that day because I'm

Erica Goode:

dropping thousands of dollars

Erica Goode:

Portland and Austin and

Erica Goode:

Illinois and like all these.

Erica Goode:

And so then you see

Erica Goode:

my card's been stolen.

Erica Goode:

Um, so it usually takes me

Erica Goode:

a few days to get through

Erica Goode:

once I turn the card back on.

Erica Goode:

but yeah, so my, cause

Erica Goode:

is, domestic violence

Erica Goode:

support for women and

Erica Goode:

children and men also.

Erica Goode:

cause that is, not exclusive,

Erica Goode:

gender problem, but when I

Erica Goode:

do have a new client, I have

Erica Goode:

to look for, who's supporting

Erica Goode:

that particular city.

Erica Goode:

And so I will call

Erica Goode:

out a website called

Erica Goode:

domestic shelters.

Erica Goode:

org and you can put in your

Erica Goode:

zip code, your city, and

Erica Goode:

it will tell you everybody.

Erica Goode:

So who is supporting

Erica Goode:

that area of the country.

Erica Goode:

And I.

Erica Goode:

tend to do my research for

Erica Goode:

domestic violence situations,

Erica Goode:

starting with that website.

Erica Goode:

So domestic shelters.

Erica Goode:

org.

Erica Goode:

If you're looking for

Erica Goode:

somebody to support, or

Erica Goode:

if you know somebody who

Erica Goode:

needs support, you can find

Erica Goode:

who's in their area there.

Erin Austin:

That's beautiful.

Erin Austin:

Thank you for sharing that.

Erin Austin:

And so, do you have, something

Erin Austin:

special you want to, alert

Erin Austin:

the audience to about what's

Erin Austin:

going on in your business

Erin Austin:

offers that you may have?

Erica Goode:

Yeah.

Erica Goode:

So I have a podcast

Erica Goode:

called coaches,

Erica Goode:

consultants, and money.

Erica Goode:

I'll assume anybody listening

Erica Goode:

to, yeah, thank you.

Erica Goode:

I'll assume if you're

Erica Goode:

listening to this podcast,

Erica Goode:

you like podcasts.

Erica Goode:

And so if you want to

Erica Goode:

look that up, coaches,

Erica Goode:

consultants, and money and

Erica Goode:

follow along there, or you

Erica Goode:

can find me at ericagoodie.

Erica Goode:

com or on the socials at

Erica Goode:

Instagram and LinkedIn and

Erica Goode:

just, see what I'm up to.

Erica Goode:

I would love to hear from you.

Erica Goode:

You can welcome

Erica Goode:

to DM me anytime.

Erin Austin:

Yeah.

Erin Austin:

I noticed that

Erin Austin:

you're on Instagram.

Erin Austin:

So your business

Erin Austin:

is on Instagram.

Erica Goode:

My business

Erica Goode:

is on Instagram.

Erica Goode:

Now, what do you

Erica Goode:

do on Instagram?

Erica Goode:

Mostly just have fun.

Erica Goode:

Let's be honest.

Erica Goode:

I go, I'm a little more steep.

Erica Goode:

No, I'm not so serious.

Erica Goode:

I'm a pretty lighthearted

Erica Goode:

person, no matter

Erica Goode:

where I show up.

Erica Goode:

But, Instagram, if you drop

Erica Goode:

into my Instagram stories, you

Erica Goode:

will see a lots of behind the

Erica Goode:

scenes, family stuff, pictures

Erica Goode:

of Idaho, things like that.

Erica Goode:

And, this is not a

Erica Goode:

revenue generator for me,

Erica Goode:

but it's fun to, be out

Erica Goode:

there and be who you are.

Erica Goode:

And my prospective clients and

Erica Goode:

my clients get to see who I am

Erica Goode:

because at the end of the day,

Erica Goode:

we're all usually, buying.

Erica Goode:

the person behind

Erica Goode:

the business.

Erica Goode:

And so I think it's

Erica Goode:

important to just be yourself

Erica Goode:

and show up as you are.

Erica Goode:

That's

Erin Austin:

great.

Erin Austin:

Yeah.

Erin Austin:

Instagram is a little

Erin Austin:

bit dangerous for me.

Erin Austin:

Productive space for me.

Erica Goode:

Not

Erica Goode:

productive, but fun.

Erica Goode:

If you want to have fun,

Erica Goode:

go over to Instagram.

Erica Goode:

If you want to get all

Erica Goode:

the, highly professional

Erica Goode:

things probably head

Erica Goode:

over to LinkedIn.

Erin Austin:

Awesome.

Erin Austin:

Well, thank you

Erin Austin:

so much, Erica.

Erin Austin:

Thank you so much for sharing

Erin Austin:

your wisdom with us and

Erin Austin:

sharing, domestic shelters,

Erica Goode:

that

Erica Goode:

domestic shelters.

Erica Goode:

org.

Erica Goode:

Erin Austin:

Erica Goode:

Thank you so much.

Erica Goode:

All right.

Erica Goode:

Thanks again.

Erica Goode:

Thank you.

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Erin Austin

Meet Erin Austin, a Harvard Law alum with over 25 years of copyright and contracts experience. As the go-to advisor for professionals with corporate clients, Erin empowers entrepreneurs to be their own advocates, standing out for her commitment to transforming expertise into empires through the creation, protection and leveraging of intellectual property assets. Explore her blend of legal expertise and entrepreneurial insight on ThinkBeyondIP.com and the "Hourly to Exit" podcast. Off the clock, you'll find Erin in the great outdoors or connecting with business coaches to elevate 6-figure consultants into 7-figure powerhouses.