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Being a business owner is rewarding, but it comes with a lot of responsibilities, and taxes are definitely one of the most vital ones. But how do you manage your business finances as a business owner?
Meet Alex Engar. Alex is the Co-Founder of CEO Finance Academy, a financial coaching firm for small business owners that helps them master their money. Alex graduated from the University of Utah with a Doctorate in Physical Therapy but quickly realized that he was not meant for the traditional 9-5 job. So, he decided to dive into the entrepreneurial sea and co-founded a marketing agency and consultancy. During this time, he got to work with many entrepreneurs and found a gap in most owners’ understanding of their business finances. And that’s how the idea for CEO Finance Academy was born.
Alex believes that every business owner should know their numbers. He says that it’s up to you to understand your finances even though you have an accountant.
In this episode of the Think Business with Tyler podcast, we talk about the importance of shining a light on your finances, why you need to take the time to find the right person for your taxes, what KPIs you should focus on, and the power of a stewardship mindset.
If you want to learn more about managing business finances, make sure you tune into this episode to hear what Alex has to say.
💡 Name: Alex Engar
💡 What he does: He’s the Co-Founder of CEO Finance Academy.
💡 Noteworthy: Alex has a Doctorate in Physical Therapy. Quickly after graduating, he realized that the typical 9-to-5 is not for him, so he decided to start his first business, which later transformed into CEO Finance Academy.
💡 Key Quote: “It is up to you to understand finances in the business.”
💡 Where to find Alex: LinkedIn
Shine a light on your finances. As a business owner, it’s your responsibility to understand your company’s finances. Even though you have a bookkeeper and an accountant, you need to know your numbers. Alex explains, “One of the very first things is just to shine a light on the finances themselves, and I call it picking your head out of the sand. And this is something that I went through as an early business owner too, where we were just growing head down, money was coming in, and I didn’t realize all the money that was going out, and I wasn’t actually paying attention to it. So that’s really the first thing, is just start looking at it and just the fact of being aware of what’s happening will often change your habits so that you’re starting to be more critical about what you’re spending.”
Take your time to find the right accountant. Trust is a vital aspect of every business. But let’s face it, it’s all the more essential when it’s your taxes in question. That’s why you need to find a professional and trustworthy accountant for your business. So, take your time to find the most suitable person for the job.
Alex says, “Every accountant is not created equal. And sometimes there are small business owners that are working with very large accountancy firms that are working with multimillion-dollar or hundred-million-dollar companies, and they’re the small fish in the water, and you’re not getting the attention you need. Maybe you need to go elsewhere, or they’re giving you terrible tax advice. Let’s go think about if they’re really the service provider for you. Because at the end of the day, if you’re a business owner and you’re hiring a bookkeeper or you’re hiring someone to help you with tax help, you are hiring them to help you solve your problems. And if they’re not doing a good job, it’s just like an employee, you’re welcome to tell them that you’re going to part ways.”
Focus on the KPIs that matter. There are countless metrics and KPIs in your business. But which ones should you focus on as a business owner? According to Alex, you should look at the smallest set of key things that will have the biggest effect on your business.
He explains, “I like to look for what are the key lead indicators, the things that I have full control over that I can measure, and know that that will have the greatest effect on the output of my business. So we’re looking for those kinds of things ‘cause, man, there’s a million and a half KPIs we could measure, and most businesses that do measure that volume of all the things, they aren’t actually looking at them or using them. And so, I would prefer to go find what’s the smallest set of key things that I actually need to measure that will have the impact on my business?”
You’re a steward of your business. Your business is your responsibility. You’re responsible for your customers but your employees too. So, make sure you do everything in your power to take care of those individuals, and your business will flourish.
Alex explains, “I’ve really tried to adopt this principle of being a steward over what I’ve been given. And what that means to me is recognizing that the things that I have in my life are not created because I made them. They’re given to me, and I am a steward over them, and it is my responsibility to take good care of those things. And I feel like, as a business owner, you are a steward over not only the finances, but you’re a steward over your team members. They have come into the fold, so to speak, into your business, and they’re putting forth a large amount of their effort, time, energy, and attention into growing something that you’ve had a vision for. And we have a stewardship to cultivate those individuals and to grow them and help them have experiences and opportunities to become better versions of themselves, et cetera.”
“A financial coach is someone who […] helps business owners figure out their personal and business finances to dial in profitability so that they can create consistent financial abundance for themselves and their business.”
“What I always start with in our process that we take people through is first start with what do you actually need the business to pay you as the owner? ‘Cause that determines a lot of the decisions that you’re going to make.”
“That’s a dangerous thing if you don’t understand things at a baseline level as a business owner and you’re trying to outsource and delegate, you and I both know that that can get you into real trouble.”
“Get that person to hold you accountable on a weekly basis to measure the things that actually matter.”
“I think that there’s a lot of just not understanding taxes, and because you don’t understand taxes, you get taken advantage of a lot.”
“It is up to you to understand finances in the business.”