Where Most People Fall Short at Entrepreneurship
Entrepreneurs, by nature, are optimists. Working with hundreds of entrepreneurs throughout my career, I’ve found we (I’ll include myself in this mix) tend to explain our way out of financial statements.
“I had to take a hit because of a capital expense.”
“I haven’t had time to sort through all my receivables.”
“I lost my receipts.”
Know your number
Don’t kid yourself by saying how the books are wrong or special in some way. The tricks and games we play in our books confuse our accountants and us! Keep it simple. If you feel the need to explain yourself, see if you can quantify those explanations so they appear in your books.
There are also the excuses like:
“I’m not a numbers person.”
“I don’t know where to start.”
“My accountant handles all of that.”
You put yourself and your business at risk by not understanding the basics of where you are. As the owner of the business, you own your numbers. You may not handle them day in and day out. In fact, I hope you don’t, but you need to be the person responsible for understanding and action on it. Stop avoiding your numbers and take ownership. Spending this time will help you discover:
- Numbers that are lying to you
- Numbers that are out of balance
- Numbers that are useless
Take an hour a week to review these things, at least, and at least a day each quarter getting a handle on the stories your number are telling. Let me know if I can help.
