To Learn More about Jeff Borschowa, [click here] to view his Media Kit.
Janine: Hi and welcome to The Thriving Solopreneur Show. This is Janine Bolon and today I have a guest who is not only a business coach, author, educator, and curator of all things related to business efficiency and technology but Jeff Borschowa. He is joining us from the accounting world were in 1991, he spent the bulk of his career working with advising, although small to medium-sized enterprises. Jeff has experience working with all sizes of businesses not only from solo proprietorships but also to international organizations, which is really good since after 2020 a lot of us have gone international.
Janine: He helps with technology to enhance the customer experience and improve the efficiency of businesses. Jeff has also met some very innovative mentors in his career. He has been fortunate to be in a position to learn from them, compare their ideas, and to truly choose the best of the best. He would like nothing more than to free business owners from the stress that is created by the high-volume commodity work and allow them the freedom to pursue the work in its rewarding personal and professional aspects.
Janine: Overall what can be said is that Jeff has a goal to reduce the hours that are worked by you and increase your overall profitability. Now in his experience, almost every business owner can tell you how much their gross revenue is, but very few actually know what their actual costs of doing business are. So he challenges you to learn more about your business and then how to bid on the right kinds of projects and to earn what you are worth with the education that you already have which is your most valuable possession. Jeff, thank you so much for coming to us on the show today.
Jeff: Well, thank you for having me, Janine. I am really excited and just to warn your audience, I have had too much caffeine this morning. So they are going to get the unfiltered version and I know you have got the energy for that. So we are going to have some fun today.
Janine: Yes, we are. So one of the first things that I wanted to bring up regarding sole proprietorships or being a solopreneur as I like to say, is that a lot of times you have to bootstrap for so long but then people kind of forget the bootstrapping when money actually starts coming and they throw it all out the window and they start marketing like crazy and they forget the really careful accounting that they did when they were in their bootstrapping phase. Then they get out ahead themselves, they get into debt and then they come to me because you know, I hope people get out of debt and then actually start running a business debt-free, as well as their personal life. So that is what I do. However, you come in and you have all these systems that help business owners. What got you into becoming a professional problem solver? I mean, what was the trigger that set you forth on us like that? It is great.
Jeff: Well, great question and you know it was a path and I will offer a lot of quotes and I will share a lot of books I read but the reality is I read something and I wish I could remember the source. But it talked about ultra-high-net-worth families and the secret to their intergenerational wealth is that they bootstrap every venture that they have. I was like because I hear a lot of businesses and as a recovering accountant, I spent 20 odd years close to 30, helping small businesses. What really frustrated me was doing the clean-up after the failure. People say 80 percent of small businesses fail in five years or whatever the number is and we just shrug our shoulders and say, “Oh well, hopefully, it is not me. Let us move on.”
Jeff: What I actually saw was that a failed business usually meant a failed marriage. There are disturbing statistics on divorce rates in business failures, forget about the stress levels, the health issues. It is not many steps from “My business failed.” to “I am a failure.” and it literally leads to suicide, depression, alcoholism, drug addiction. I have seen it all as an accountant and I am a very empathetic person. So I felt the weight of all of those failed businesses and it just every year accumulated. Finally, I said there is got to be a better way and that was when I started getting really serious. I have written five books in the field, helping small businesses do better.
Jeff: Just full disclosure for your audience, I have trained thousands of accounting firms on how they can run their businesses better. So just think about that for a minute. Everybody thinks “I am going to go talk to my accountant.” Most accountants think of what they do as a profession or a calling. It is sad but a lot of accounting firms are not making as much money as they should. They are not as efficient as they should. So in the end, they give a lot of defensive advice. Here is how to reduce your taxes. Here is how to do this. Here is how to do that. They are not doing a lot of the proactive advice that they should. Now, I am not saying that is all accountants, but there is a majority.
Jeff: So I got really really focused in 2013. I started teaching accountants how to run their practices better and not surprisingly the number one conversation we had was “How do you manage your cash flow?” After a few years working with accountants and a track record of changing zero lives. Because I would teach the accountant, they get really excited. Then tax season hits, they forget about it. In 2020 with the world going crazy, I realized I could not just sit on the sidelines and say “Okay, accountants get out there.” So I jumped in and in 2020, and have not looked back I have actually written two books on cash flow since January.
Janine: Well, I would love to be able to talk about ‘Making Maximum Money’ and that is where you actually give a guide to business owners so that they have easy as pie cash flow optimization. Of course, as you know, I am a mathematical geek. I am a scientist at heart. So when I think of pie, I think of the dessert but I am also thinking in terms of circles and you did not disappoint. You have circles and you have ways of optimizing cash flow and knowing how to point your focus and your attention to me. That was the most valuable part of your book.
Janine: It was like you made it so simple for a solopreneur like myself who has just enough. I have no accounting background. I can work with numbers but when you put a dollar sign in front of it, my brain kind of seizes up. It is stupid but that is just the way it is. But put it times 10 to the negative 23rd, I am your woman, I can make it happen for you but it is just one of those crazy things that I have. Anyway, with your ‘Making Maximum Money’, you have this easy as PIE, P-I-E aspect. So if you do not mind, just kind of run us through your PIE that you talked about to people about helping them with their cash flow.
Jeff: Absolutely. First of all, I wanted something simple and it was a real challenge because everything out there read like a textbook and I would read it academically as an accountant and go “Yeah, that makes sense.” In the first draft of the book, I actually ran through my accounting audience and I got a lot of negative feedback. It hurt my feelings and not that I am going to cry over it, but it was like “Wow, they really lashed out.” When I stopped feeling the stings, I started listening and what I realized was they were complaining because it was too simple. That was my “Aha!” moment.
Jeff: I got really grateful very quickly because one of the mistakes a lot of accountants make is they write the textbook and they go “Here you go!” and then the business owner who is typically more creative, more risk-taking, look at it and go “Oh my God, I do not want to read that.” You know, accountants love spreadsheets, business owners love graphs. So I started with the concept of a pie chart and I am like “How could I make this so simple anybody can understand?”
Jeff: When I got the negative feedback from the accounting community, these are the secrets they do not want me to tell you and the reason is they just feel that this is so obvious. There were a few comments about “You are stating the obvious. You are telling us the sky is blue, the sun is yellow, the grass is green. So what?” So PIE is my acronym. The accountants really hate the acronym but I love it. It stands for Profits, Income, and Expenses and just for fun, I made it double. I do a lot of alliteration. So we get a double dose of pie today. Specifically, it prioritized profits, increased income, and eliminated expenses.
Jeff: Yes, it is obvious but to the layperson who has not studied years of accounting, there is a lot of “Aha!” moments in this. My personal favorite, I conduct masterminds, I have seen grown men and women burst into tears. One of her exact words were “I have been in business for 30 years. This is the first time I understand why I am struggling.”
Janine: Right, because what the accountants that were saying to you this is obvious, what we did not get as solopreneurs is we are colorblind. So yes, the sky maybe blue. Yes, the sun to you is yellow and the grass is green. That is obvious to you but you do not understand the filters we are walking through as solopreneurs. We are colorblind to your world, right? Because our world is operating in “Wooh Land”, it is what I like to call it. It is a kind of a basis on the Lego movie where Batman sitting and going “I hate this place.” Because you have got unicorn, Kitty, and all the cotton candy, and the magic, and the fantastical creatures, and all that.
Janine: Because for solopreneurs, we venture out into this crazy world that is totally untamed and it is up to us to figure out what we are going to do and how we are going to do it. That was one of the things I loved about your book. So thank you very much for letting me read it ahead of time. It was just the fact that it really is for what I call the solopreneur who is so busy creating. They really do not want to get immersed in the details. Hence, this is why I have hired you, my dear friendly accountant, to deal with the details. Then after you have had those details, then if you would be so kind once a month to reach back to me, and then let me know where I am going.
Janine: So I found out “Oh, my accountant does not want to do that. They find that boring. That is not their happy place. I had to hire a financial strategist who then is the one that upchucks the data to me, but then he is my interpreter between my accounting and my financial planner and blah blah blah.” A lot of solopreneurs do not even know that these are possible. So talk to us a little bit about it. Everybody wants to increase income. Yes, yes, yes. And prioritize profits. Yes, yes, yes. But where are the areas that you have found with your masterminds where people have the biggest hiccups?
Jeff: I think there are a few but the biggest one is how to start, and that was the way I wrote the book. I wrote it from the perspective. Consider me the guide or the translator. On the one hand, we have got the accountant with the spreadsheet in hand. For the record, I used to be that person. I would spend hours agonizing over my spreadsheet and I would present it to the client. I am not exaggerating every now and then a little to daunt[?] about in a flourish and I would be waiting for applause and they look at it and go “Uh-huh.” and shove it in their binder and I am like, “Wait wait wait, this is the Mona Lisa. Get that out of there. I even color-coded it for you.” and they are like, “I do not know what it says.”
Jeff: Again with ‘Making Maximum Money’, the first place to start is a little diagnostic and I actually wanted to keep life simple. Something we all understand. So I used a traffic light system. For your listeners, for the solopreneurs, I have worked with more of you than I can count. You may be color-blind to the world of accounting but you all know the difference between red, amber, and green. That is why I kept that simplicity and I wanted it to make sense. So red is “Hey look at this, we need to solve this now. Yellow is “You know, we might want to look at this sooner rather than later.” and green is “We are doing really well.”
Jeff: So that is the methodology I incorporated. But the number one thing where I see people hanging up, and this applies to the right brain and the left brain entrepreneurs. Most of them, and secret little shame here in the industry, vast majority of accountants I talked to do not have a business budget. In my opinion, that is the foundation of all we will do because if you do not know where you want to get to and you do not know where you are today, you become like Alice in Wonderland. Wandering around not knowing how do I get from here to there?
Jeff: So the very first thing is the business budget. You and I have talked about it that it is the Guiding Light or the North Star. The business budget is literally the first place to start. Do not let it intimidate you. It is going to start looking like a spreadsheet but that is why you have an accountant or bookkeeper. They love spreadsheets. All they need to tell you is: red, there is a warning light here. We need to look at it; Yellow or amber, things are okay but you want to look at it; or Green, everything is great. You can keep moving.
Jeff: My personal take on this is that the greatest weakness every entrepreneur has or their greatest pain point is they suffer from uncertainty. So if we do not know what to do next, we do not know where our next client comes from, or next dollar revenue comes from, we overcompensate by doing way too many things. Then we end up burnt out and exhausted because we are doing 995,000 things. But really truly if we look at our budget, there are probably only 4 or 5 things that we need to focus on to move the business forward. So I see that the budget is the blinders that keep us from – as Michael Gerber said, he talks about the entrepreneurial seizure.
Jeff: I think that is a misnomer because it is not a one-time event. It is like we have every day, we have an extra seizure. It is like “Oh, what is this?” Seizure meets shiny object syndrome. What I like about having a good budget – and by the way, a good accountant or bookkeeper in your corners huge build that advisory team and surround yourself with the smarter people that you do not necessarily understand but force them for whatever ways you have to do it. It is their job to communicate to you, warning or all is well. So you want that sort of all-clear signal. That, to me is probably the most value a good accountant or bookkeeper should be able to bring is “Janine, these are five things you need to focus on. Go.”
Janine: Exactly, and one of the fun things that I have learned over time is the fact that when it comes to finances, I have learned that some people are very uncomfortable talking to women about money. Of course, I have no difficulty. I mean this is part of my life because I talk about money all the time but I noticed that when I was married, they would always talk to my husband. So for those solopreneurs that are out there that are female, please realize that your financial team may be struggling a little bit just with the lack of being able to communicate with you.
Janine: So what I always said was “Oh, well, that sounds very lovely. This was my standard operating procedure.”, “Oh, that sounds very lovely and it looks great. Good job. Thank you so much for putting all this together. I have no idea what it says.” and you would watch their brains fuse and they go “Well, it is kind of evident” and then they will realize they are insulting me now. I am like “I know it is very evident to you but I am a scientist and I work at negative numbers to the 23rd power. We are now dealing with decimal spaces that are only incensed and we are working with thousands to millions of dollars. So you are going to have to help me out.”
Janine: It was fascinating to watch the mental gymnastics that they just were not used to talking to somebody who did not know what was going on. Like you, when I started talking to solopreneurs and other business owners, I realized there are people that have been in business like you said 25 and 30 years. They never understood the P&L sheets. They never understood really what was going on. They were just like using it as a guidepost blah blah blah.
Janine: So as we help our solopreneurs, as we move forward, the big thing I want to encourage everyone to do is do not leave that office until you understand what is going on. And if you get more and more confused, realize you need another person on your team to translate what your accountant knows but is unable to communicate so that you can build your business better. Getting back to PIE and your wonderful book, Jeff, of ‘Making Maximum Money’, you also have ‘Mastering Cash Flow for Business Owners’. You have several books out.
Janine: One of the things I really loved about ‘Making Maximum Money’ was you do make it super simple so that I do not feel like I am a roulette wheel trying to hope whatever, wherever the crisis of the moment is. So as you were talking to people about the biggest thing was where to start, right? So if people know “Okay, I need to get a budget.”, “Okay. Now, something is being flagged in my budget” what are some of the top two or three things that you have heard from your business owners once they get your book and they are like “Okay, I now know where to start but this is my next problem.” So what is the second problem that they come up against?
Jeff: I think the second problem, and it comes back to the communicating with the team, and this is going to sound very weird for a discussion about money. It is almost always a shame. It is a fascinating thing because we pay an accountant to tell us what to do and then we do not understand it. So we immediately feel some shame or there is embarrassment or something like that. Whatever feeling you want to call it. But the reality is that is the one where we nod and say “Yeah, I understand. Thank you.” and we trudge out and we go out into the wilderness disarmed.
Jeff: Again, I cannot reiterate enough. Either find the language to get your accountant to explain it to you or find the accountant to as the language to explain it to you. Do not live in that shame. You are not alone. This is a common problem and the reality is accountants know it academically. So they can tell you the formulas, they can tell you the measurements, the metrics. They do not necessarily always understand the business behind it. So quite frankly, they have shame working against them because they do not want to admit that they do not understand your business.
Janine: Yes, that is one of those [crosstalk]. Oh, go ahead. I did not mean to overstep. Go for it.
Jeff: No, I was going to say the other big thing is a lot of entrepreneurs try to be all things to all people. One of my passions is getting them really clear. There is one thing your best in the world at, build a business around that, serving people you know how to help, and letting the revenue come first. Because a lot of businesses do a bunch of work and accountants have this model. The worst business model out there is I get a client, I do a bunch of work, and then eventually get paid. A lot of businesses make that mistake. It is like we cannot afford to grow because we cannot buy more inventory. We cannot hire more staff.
Jeff: So one of the things I recommend people start with if they do not know anything else, find recurring revenue so that every month you have got a minimum foundation that covers your expenses. You can grow a business very quickly if you have, I call it the ‘freedom number’, but basically enough money every month coming in whether you do anything or not. There should be recurring revenue so that you are not always chasing. Because what most businesses do is they spend all month trying to get the revenue to cover their overhead and they celebrate somewhere hopefully before mid-month where revenue exceeds expenses.
Jeff: I worked with one business. The 28th of every month was when their revenue exceeded their expenses. So they literally had 3 days a month or 2 days a month where they were profitable. The rest of the month they were in their red, they were boring on lines of credit. That is a hard place to be. So take the time and figure out what is recurring revenue that you can implement in your business. For the record, I have yet to find a single business that did not have recurring revenue, just sitting there waiting to be implemented.
Janine: Well, thank you so much for giving us those top two secondary problems. After you know where to start then you have other layers that you need to start digging into. The first thing is definitely get your business budget put together so that you at least know where you are, where are you today. Then do not worry about the guilt, the shame, do not think about past mistakes. Those emotions are not serving you as a solopreneur. Then the next thing is to determine your freedom number. What is the number that you need to make so that you can start really exponentially growing your business? I just wanted to remind you, Jeff Borschowa, I always want to throw an extra syllable in there, with his book.
Jeff: It is okay. I got plenty.
Janine: Yes, you do. ‘Making Maximum Money’ is the book you definitely want to go to. So Jeff, where can they go so that they can get this book and start looking into your cash flow optimization program?
Jeff: The easiest place, we are all over Amazon. So you can buy the book on Amazon or you can visit our website. It is a really unique name. It is makingmaximummoney.com. See it is not easy to say.
Janine: No, that alliteration can get you tongue-tied sometimes. Well, thank you.
Jeff: The best place, Janine is actually Linked In and I will include the link. I love connecting with entrepreneurs on LinkedIn and if I can connect you with my network, I am happy to do it.
Janine: Jeff is a very good referral partner. If you are willing to help him with referrals, he is a fantastic referral partner. Thank you so much for your time today. We are at the top of the hour. I just wanted to say thank you so much. Have a great day everyone. For those business owners out there, keep your feet firmly planted with where you are now but do not dare give up on those dreams. You keep stretching. You keep learning, keep educating yourself and you will get there. Have a great day. This is Janine Bolon with The Thriving Solopreneur.