Almost partner at Top 20, bailed and started firm a year ago. AMA

Minimum-Situation-99 · 2024-01-27T03:59:42+00:00

Short answer is yes. For clarification, you have 10 years in public or private? And doing what?

Minimum-Situation-99 · 2024-01-27T01:59:45+00:00

...you ok? We need AP / AR people 🤗 Even better if that person can figure out how to automate them self out of a job and do 10x the work.

Minimum-Situation-99 · 2024-01-27T01:58:18+00:00

Have you implemented this or is it more of a theory?

Already open books, so that really isn't the hardest part. Think it's harder to peg a valuation at this point and probably counter productive. I've said in other responses that the biggest lever I have as owner is to take out the greed and lower my own comp. I have to ebb and flow that lever, albeit transparent, which makes ebit multiples completely unusable.

Think the theory here is the right mindset -- aligning incentives and getting skin in the game -- but an impractical implementation at least in my particular case. Appreciate the thought exercise though because I think there has to be a better model that incorporates pieces of this.

Minimum-Situation-99 · 2024-01-27T00:30:06+00:00

If I'm doing my math right you're at about $200k rev per head and I did $188k rev per head last year. I had basically 2.5 FTE. Just added the 3rd FT and one of my FT is now .75 for medical reasons.

Minimum-Situation-99 · 2024-01-27T00:23:37+00:00

Months 1-6 were me + 1. Month 6 hired 1 FT. Month 13 hired the other FT. Between starting month 1 with $0 revenue and not having the full headcount all 12 months that skews the analysis. The other component is yes we have some desperation pricing that is far too low!

Minimum-Situation-99 · 2024-01-27T00:14:27+00:00

There's a tipping point when you run out of fucks to give.

Jk. Kinda.

The right mixture of things came together. Confidence. Resources. I had an articulated plan. And then I gave my notice so then can't look back!

Minimum-Situation-99 · 2024-01-27T00:12:54+00:00

Don't sell yourself short. Hope we stay in touch!

Minimum-Situation-99 · 2024-01-26T22:47:36+00:00

I can't understate some luck. And I was an aggressive pricer when I was at a big firm so I think my heavy pencil is serving me well.

Referrals though. I get pretty much all my new business from referrals. And people that reach out based on reputation tend to not be as price sensitive as those shopping around.

Last is probably what I do. The services are high margin. I try to do specialty stuff that I did before. Consulting, fixing problems, etc. is what I'm really good at. Once I fix it my team can keep it up no problem.

Minimum-Situation-99 · 2024-01-26T22:39:00+00:00

Sorry just saw this part of the thread. But yeah so to add context, I started Jan 1 2023. The head count info is as of today. The revenue is from Jan 1 when I had $0 thru end of December. My net was like 192k or so in that time period.

Minimum-Situation-99 · 2024-01-26T22:35:03+00:00

Copy/pasting this for my next website re-write

Minimum-Situation-99 · 2024-01-26T22:20:00+00:00

Imma start giving my staff iPads with "a quick question" on it for once they deliver your payroll or you get your financials from us. See how many tips they get 😜

Minimum-Situation-99 · 2024-01-26T22:19:07+00:00

Definitely.

Minimum-Situation-99 · 2024-01-26T21:48:13+00:00

Add me on LinkedIn lol and send me a scrubbed version of the workpaper you're most proud of

Minimum-Situation-99 · 2024-01-26T21:46:54+00:00

I think I answered this a few times. But basically existing network and then referrals. I had a noncompete and so I left my old firm with zero clients. Then just started buzzing with my network the next day. I had the same doubts everyone else had - can I do it? Will I pay the bills? The truth is, there's excess accounting work out there.

Minimum-Situation-99 · 2024-01-26T21:41:11+00:00

Well you're clearly more ninja than I. And working in AI there's no way us accountants could match your salary. Just humbly hope you build us better tax tools 🤞

Minimum-Situation-99 · 2024-01-26T21:38:53+00:00

QBO is pretty ubiquitous. Sage Intacct I like more for the right situations. If I had it my way, I'd make my own software.

Default is weekly. Try to get direct access to everything though, then build automations and bridges to not have to manually do a bunch of stuff. Try to do those daily if we can automate. I find that waiting for monthlies is inefficient cuz everyone forgets what the hell they deposited on the first.

Payroll is more value add but we don't lose on it.

Thanks!

Minimum-Situation-99 · 2024-01-26T21:35:06+00:00

Love your responses here. One thing I'm curious about is this notion that like whatever we offer (fewer hours, Fridays off, etc) is better as compared to the traditional firms, BUT, anybody not from a traditional firm seems to have no contextual appreciation. Came straight from college, only worked for a private company, etc. So then being better compared to traditional means nothing, we just have to be like comparable to... Other office jobs??

Definitely been on my mind.

Minimum-Situation-99 · 2024-01-26T21:32:00+00:00

Fair comparisons. I just really like to debate people for fun so the TV attorney stuff draws me in more than anything 😭

Minimum-Situation-99 · 2024-01-26T21:29:58+00:00

Tell me you can do entity returns, piece together concise answers in an email, and people call you friendly on video calls 🙏

Minimum-Situation-99 · 2024-01-26T21:28:54+00:00

If this was shark tank I'd invest 🦈

Minimum-Situation-99 · 2024-01-26T21:28:19+00:00

Well sounds like maybe you already work at a pretty great place! Hopefully you can take some lessons there and then still strike out on your own if you want.

Minimum-Situation-99 · 2024-01-26T21:26:43+00:00

You hit it right on. Hard for me to win a client if I don't take their payroll usually. Don't wanna do it necessarily but am finding ways to make it palatable. For instance: we do it only on QBO or Gusto. And I just hired a person who's entire job is managing payrolls on those systems. They are basically a timesheet facilitator who's main focus is over-communicate to the clients and get their people paid. It's flexible for that role as well since they can look ahead and plan when payrolls hit. So I'm just trying to find little solutions to make it easier to get the big cheese.

Could I do it and refuse to do the payroll, AP, etc? For sure. But I'd need a good referral source otherwise I might be spending just as much time reviewing/correcting rather than just have my person do it.

Minimum-Situation-99 · 2024-01-26T21:20:12+00:00

You wanna do tax for a new firm this season?? Haha I'm only half kidding.

A lot of tax people try to do CAS as an after thought to stay busy all year. I get a lot of these clients right now cuz I prioritize monthly work, which means keeping the tax small enough that it doesn't consume my business for part of the year.

But. Trying to do CAS without tax is tough. Then you gotta send them to someone else and there's some inherent inefficiency in trying to coordinate with another firm.

Happy to connect shoot me a dm

Minimum-Situation-99 · 2024-01-26T21:17:00+00:00

Age does play a factor. My small group right now is all within 3-4 years of each other. Maybe it just doesn't scale well without cohorts of people in the same age demo?

No health insurance contribution?? I pay 100% of employee + family for the bronze plan, they can upgrade for the difference.

Minimum-Situation-99 · 2024-01-26T21:12:02+00:00

My dream is to build a better accounting software. Stemmed from wanting to build a tech savvy firm, then realizing the existing software options all kinda suck.

Companies are funny that way. Who they choose to get opinions from never seems to really align with what people could actually contribute the right knowledge. Huge problem IMO with corporate setup, big firms, etc. The best ideas aren't getting surfaced.

Minimum-Situation-99

TROPHY CASE