Attention, Self-Employed Bosses! Here Are 4 Tips for Budgeting on a Variable Income

Photo: ColorJoy Stock

During my first month as an entrepreneur back in December of 2018, I made $226 as an administrative assistant. Fifteen months later, I would go on to quit my day job and make upwards of $5,000 a month as a freelance writer and content creator for Rosetta Stone. 

While I had excitedly waited to get to this point, it was still hard for me to give up the financial security of my day job. Without corporate perks like PTO, health insurance, and automatically deducted taxes, I suddenly had to make sure I had enough to get through the expected—and unexpected—costs each month without the help of a regular paycheck. 

As an entrepreneur or freelancer, it is completely normal to have an irregular income, but it can definitely make budgeting your money a little trickier. Luckily, after a lot of trial and error and some helpful advice from a top-notch financial coach, I can finally say I’ve figured out how to budget with a variable income. Since this is something I wish I had known years ago, I decided it was time to share with my fellow business owners!

1. Calculate Your Monthly Needs

Before taking control of my budget, I had no clue how much I really spent per month. Like most young business owners, in my first two years of business, I was pretty much taking whatever job I could get—mostly because I just needed to get my bills paid. Never really knowing how much to expect from month-to-month, I ignored my bank account completely.

Every month I would just cross my fingers and hope I wouldn’t get an “insufficient funds” notice from my bank. But, this method led to a lot of extra stress and negative emotions around money. 

So, one day, I sat down and went through my last three months of bank and credit card statements and looked at how much I had been spending on necessities. This helped me figure out how much I really needed to be making each month to get by. Some common needs within a personal budget include things like:

• Rent

• Utilities

• Groceries

• Gas (only for required outings)

• Debt repayments (minimum required payment)

• Phone

• Personal care (toiletries, medicine, etc.)

• Insurance (car, life, etc.)

• Essential family expenses (childcare, clothing, etc.)

I also included the needs I had for my business. Some common business needs within a budget include things like:

• Employee/contractual worker wages

• Website hosting

• Email hosting

• Insurance (health, business, etc.)

• Public relations

• Marketing/advertising

• Business-related debt repayment

• Travel

• Taxes

• Business-related software (accounting, email management, website building, social media marketing, SEO, project management, CRM, communication/messaging, etc.)

• Business-related hardware (computers, phones, printers, etc.)

And this isn’t just what I learned from personal experience. When I sat down with financial coach Yvonne Tran for one of my podcast episodes, she echoed this sentiment as well. “If you have variable income my biggest tip would be to know how much you need to pay every month for expenses or bills and make that a goal to bring in every month in your business,” Yvonne shared.

2. Reset Your Money Mindset

Like it or not, we all have certain ideas about money. Whether you grew up hearing “money is the root of all evil,” “a penny saved is a penny earned,” or any other common money-related beliefs, our society has a lot of positive and negative associations with money.

Having grown up in a family of entrepreneurs, money struggles—and the negative money mindset that comes with them—were no stranger to me. For a long time, money was something that I considered stressful and even dirty. It wasn’t until I learned to see money as a tool and something to be grateful for that the money really started flowing. 

“Money mindset is definitely really important because if you view money as so stressful, super complicated, and intimidating then I can show you all the ways that you can fix your financial situation, but if your mindset is telling you ‘no’ then it’s not going to work out in the end,” Yvonne told me. 

A few ways you can reset your money mindset are:

• Using positive affirmations around money (and putting them everywhere!)

• Learning to give money away without fear

• Evaluating your beliefs around money 

• Actively fighting off any negative thoughts about money

• Fostering gratitude in every transaction

3. Cultivate Healthy Money Habits

Creating a strong budget and resetting your mindset creates a strong foundation for making good financial decisions, but keeping up with those good financial decisions means you have to cultivate healthy money habits too. Some healthy money habits that could help keep your budget on track are:

• Downloading a money-tracking app like Mint

• Spending with gratitude, not fear by using affirmations like, “I am grateful for all that money brings me,” or “I am grateful that I can contribute my money to the economy/this cause/this person,” when spending money

• Setting financial goals each quarter

• Waiting 24 hours before buying “wants” to avoid impulse purchases

• Saving 20% of your income for the unexpected

Yvonne is a big proponent of saving, especially when you have a variable income. “If you happen to have a short month one month and not bring in as much as you need then hopefully you’ll have that extra savings already set aside,” she shared. “That way, that can come in to fill the gap for that month, and then you’ll just work harder next month to bring in more money.”

4. Re-Evaluate Your Budget Each Month

If you have a variable income it is best to evaluate your budget pretty frequently. By re-evaluating your budget more often, you’ll have a better handle on your money as your income changes.

Since I can usually predict my income for the next few months, I tend to re-evaluate my budget each quarter, but monthly works great too. Here’s the method I use: first, I calculate how much I’ll be making over the next three months. Then, I divide that up to give myself a general monthly budget. Finally, I calculate all of those personal and business needs we talked about earlier. 

Next, I subtract my needs from my income and I use that final number as my budget for the month. I’ll usually take out a percentage for savings, but the rest I let myself spend freely. Some people prefer to take their savings directly out of their income, but it makes me feel better knowing everything else is taken care of first. This works well for me because on good months I can splurge on certain items, whereas on not-so-good months I have to reign myself in a little bit. But either way, it gives me a concrete number to focus on each month. 

There are hundreds of ways to budget your money, but the best budget is the budget that works best for you. I tried a lot of budgeting methods before I found one that really worked for me, so don’t get discouraged if you struggle a little bit. For me, once I changed my mindset around money everything changed, so I would definitely suggest digging into your own stories around money before getting started. Happy money-making!

“There are hundreds of ways to budget your money, but the best budget is the budget that works best for you.”

—Calli Zarpas, Founder of the Do Well Department

About the Author: Calli Zarpas is the founder of the Do Well Department, a holistic business program created to help overwhelmed business owners cultivate a business and life they love. When Calli isn’t running her community, she’s writing her weekly newsletter and hosting her podcast called Unstrictly Business, all about how successful business owners foster success in both their business and personal lives (Yvonne’s episode is an awesome place to start!).

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This Former Scuba Diving Instructor Is Reducing Single-Use Plastic Waste, One Beeswax Wrap at a Time

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Pink Palm Media; Courtesy of Evan Guiton

Before Evan Guiton started Bee Kind, she was on a very different career path. “I was working as a scuba diving instructor on the Great Barrier Reef in Australia, and all I wanted was to spend as much time as possible hanging out with humpback whales,” she tells Create & Cultivate. But she couldn’t ignore the devastating effects of plastic pollution on the ocean. “As someone who was spending significant time underneath the water, I had a front-row seat to the suffering and destruction ocean plastic pollution was causing,” she explains. “Every single dive I went on I would encounter a fish or marine animal who was having some sort of interaction with a piece of plastic.”

After a while, it became hard for her to reconcile enjoying the ocean without being a part of the solution, which is how the idea to launch a business that reduces single-use plastic, came about. “I wanted to educate people about the seriousness of the problem and empower my community to become more sustainable in their everyday lives,” says Guiton. “By creating trendy, accessible, and affordable products that could replace everyday plastics, I knew I could bring zero-waste into the mainstream,” she explains of the concept behind Bee Kind. “Shortly after this revelation, I quit my job as a dive instructor and flew home to Canada to begin working on my first beeswax wrap prototype.”

Here, Guiton explains why she decided to bootstrap her business, shares the money mistakes she’s made along the way, and offers her best advice for entrepreneurs.

How did you fund Bee Kind? What were the challenges and what would you change? Would you recommend your route to other entrepreneurs? 

I bootstrapped Bee Kind from the ground up, which means I never took any funding or investment. In the beginning, I spent a few thousand of my own dollars fleshing out a website, a logo, production supplies, and raw materials. I was lucky enough that I was able to make a profit almost instantly through local craft markets which encouraged slow but steady momentum forwards without digging much further into my own wallet.

While I am grateful I did it this way (as now I am happy to say I still own 100% of the business), it was a financial balancing act for many years. Without funding, I had to completely rely on company profits to slowly grow, in addition to being hyper-specific when it came to forecasting the purchase of raw materials. When you make these bulk purchases, your money is tied up in these raw materials for approximately four months before you begin to turn it around in sales of finished products. Knowing this, I had to be incredibly accurate when forecasting our growth.

What was your first big expense as a business owner and how should small business owners prepare for that now?

The first time I purchased our custom printed fabric I was horrified to learn about MOQs and the amount of customized product I would have to commit to upfront. I had very limited dollars to play with at the beginning, so I had to make compromises in what we could afford while still ensuring we created a really special product. 

I recommend that business owners do A LOT of digging into any big purchases they are about to make. Is there a better deal out there? Are you absolutely sure that you need to spend money on this? Is there a better (or just different) way to achieve the same result? The more you can think outside the box in growing your business, the more you can help your bottom line. There are a million ways to achieve the same result, so don’t feel like you are cornered into throwing money at a problem. 

Photo: Courtesy of Bee Kind

What are your top three largest expenses every month?

Payroll, raw materials, and our photographer on retainer /social media content creators.

Do you pay yourself, and if so, how did you know what to pay yourself?

I’m four years into the business, and to this day I prefer to pay myself just enough to cover my bills and necessities. Putting as much money as I can back into the business so it can grow is my best investment. In all honesty, there came a point in time where all I wanted was a new production warehouse, and that meant infinitely more to me than having extra personal pocket money. The decision was that simple.

Would you recommend that other small business owners pay themselves? Why or why not?

I think business owners need to cover their bills and be comfortable so that they can mentally and creatively show up for their business every day. However, when they choose to start properly paying themselves completely depends on their personal situation. I think they also need to realize that putting money back into the company, in the beginning, could create much higher returns later on, and that might be worth it to them in the long run. 

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

For many small businesses, the founder is the accountant, the maker, the marketing specialist, the delivery person, and everything in between. While this was a stressful way to go about running a business, it was the only option financially for me for the first couple of years. I hired someone to help me make the beeswax wraps when I physically could not keep up anymore. Once I realized that hiring help was in fact not a financial burden, and instead, a fast track to growing the business, I was much more relaxed in adding more people to the team.

I knew that I had a lot on my plate as a business owner and that I absolutely did not want to add “becoming a manager to a team of people” to my to-do list. From the beginning, I clearly defined my employees’ roles as independent, self-starting, and with “choose their own schedules.” To this day, I have never written out a staff schedule and my team is there on any given day because they want to be, not because they have to. I wouldn’t have it any other way!

Photo: Courtesy of Bee Kind

Did you hire an accountant? Who helped you with the financial decisions and setup? 

If I had one piece of advice to small business owners it would be this: hire a bookkeeper from the beginning. You don’t need anything fancy, but where it comes to your books, you want a professional keeping them straight. When you get bigger, you can look at getting a CPA, but at the start, a budget bookkeeper is all you need. For too long, I thought I could do it myself on Quickbooks online, and it was a giant learning experience.

What tools or programs are you using to manage your business finances? What’s worked and what hasn’t?

Quickbooks online and a great filing cabinet system are what I swear by. What hasn’t worked? Going at it alone without an accountant.

Do you think women should talk about money and business more? Why or why not? 

Absolutely! As someone in charge of hiring new employees, I have often been in a position where I didn’t know what I should be offering in terms of compensation simply because no one likes to talk about what they get paid. If wages were talked about more casually, I think everyone would also become more ambitious in achieving salary milestones.

What money mistakes have you made and learned from along the way?

Every opportunity that involved us providing free (or almost free) product in exchange for “exposure” has been a hefty disappointment. In my humble opinion, the majority of companies that promise you exposure so that they can make money off you or your product should be approached with a great deal of caution. Put your time and efforts into organic engagement and creating genuine connections with your followers.

What is your best piece of financial advice for new entrepreneurs?

If you have a good idea and a blossoming business, you will get approached ALL the time for investment opportunities. If you’re thriving, people will want a piece. While this is incredibly flattering and exciting (especially at the beginning), the people you want on your team are not the ones asking for a piece of the pie during their first conversation with you.

Also, save money for a rainy day. Opportunities will come that you want to take advantage of which you need money for RIGHT NOW. Keeping a nest egg is an incredibly wise decision as it allows you to make big moves.

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How Samara Walker Launched Auda.B While Working Full-Time as a Senior Financial Analyst at Amazon

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Samara Walker

"Balancing a full-time job and a start-up is extremely demanding and requires a different level of patience, organization, and ability to challenge yourself," Samara Walker, the founder and CEO of the luxury vegan nail lacquer brand Àuda.B, tells Create & Cultivate. “Time is of the essence because every minute counts when you have to delegate between your 9-5 and your startup,” she explains. But Walker was more than up to the task of managing her minutes and balancing her full-time role as a senior financial analyst at Amazon with building her beauty start-up. And for good reason.

Walker launched Àuda.B because women of color aren’t often represented within luxury beauty. “Oftentimes, luxury beauty brands omit the celebration for women of color,” she explains. “I was truly inspired to launch Àuda.B to create a brand that reflected women of color from A-Z. Through product curation, branding, and marketing, I knew that I wanted to build an inclusive brand that kept women of color top of mind,” she adds. And major retailers have taken notice. Earlier this year, Àuda.B launched on Nordstrom, becoming the first Black-owned polish brand to be sold by the retailer.

Ahead, Walker shares when she knew it was time to quit her job at Amazon and go all-in on Àuda.B, what the biggest challenges in scaling her business have been so far, and how she’s pushing the beauty industry forward and making a difference.

You started Àuda.B while you were working full-time as a senior financial analyst at Amazon. Would you recommend starting a business while working a full-time job? 

As I reflect back, I would recommend starting a business while working full time because this allows you to put your passion and work ethic into perspective. Having a stable income allowed me to invest in my business by relying on my paycheck and helped me bootstrap my company to the next phase. Working a full-time job while starting a business put my life into perspective and really encouraged me to go after my dreams!

How did you know when it was time to quit your job at Amazon and go all-in on Àuda.B? What was your strategy for making the transition and what, if anything, do you wish you’d done differently? 

The day I signed my partnership agreement with Nordstrom, I knew I had to prepare myself to leave Amazon. As a small start-up, I had to manage and develop the supply chain strategy for the business and onboard new systems to become compliant with the retailer, which is no small undertaking. The demand for Àuda.B became overwhelming (in the best way!) between the influx in orders and the partnership with Nordstrom. I was tasked with the decision of pouring my energy into Àuda.B or Amazon, and the decision was not difficult at all. I had worked tirelessly for this day to come, and I was prepared to put all of my efforts into it! 

As a founder, I positioned myself from the very beginning to save aggressively because I knew that bootstrapping would allow me to have total control while building my company until we eventually secured an investor. I made strategic moves such as setting up direct deposit from my Amazon paycheck to the Àuda.B business account each pay period to build our business account for expenses and to budget for part-time contractor payments.

It's important to build out a real plan between personal and business expenses in order to set realistic expectations of what your savings should reflect to allow you to step away from your full-time job. Founders need financial security in order to operate from a healthy mindset—shelter and food shouldn't be optional. I wish I had the ability to establish this plan earlier on in my career, but I am thankful that I finally had the courage to fully step out and embrace the abundance of Àuda.B.

Photo: Courtesy of Àuda.B

Earlier this year, Àuda.B launched on Nordstrom, becoming the first Black-owned polish brand to be sold by the retailer. What has been the biggest challenge in scaling your business and what lessons have you learned along the way? What advice can you share on how to scale a business sustainably? 

The biggest challenge in scaling has been producing enough inventory to keep on-hand, as well as implementing systems to scale with limited cash. I've since learned how to prepare your business for the next phase and have strategies and plans in place to anticipate the arrival of growth. My advice would be to plan your business for the next phase before the growth actually impacts your company. Research potential partnerships to help scale, whether that's a 3PL or EDI system to manage your growth and scale effectively. 

How did you fund your business? What were the challenges and what would you change? Would you recommend your route to other entrepreneurs? 

I bootstrapped my business by funding through my full-time salary and personal savings. Some of the challenges I faced were not having enough cash on hand or the ability to order new inventory to keep up with customer demand. Managing expectations is important. Having a well-balanced inventory is essential to keep up with customers’ needs and demands. 

At first, we didn't have the ability to expand our color selection or significantly increase inventory without the guarantee of customer’s purchasing. I would change the way I handled inventory by ordering more to create a surplus for an unexpected increase in sales. I would highly recommend bootstrapping your business until funding is secured via an investor if that's the route you decide to take. Bootstrapping gives you the grace of building at your own pace and learning all aspects of your business from the ground up.

What was your first big expense as a business owner and how should small business owners prepare for that now? 

Our first big expense was hiring a lawyer in order to apply for our trademark. Small business owners should create a list and prepare for start-up costs that can be accomplished over time but are necessary for the business’s growth. Putting aside a few dollars that are dedicated solely to start-up costs will help prepare business owners for anticipated expenses. 

What are your top three largest expenses every month?

1. Part-time contractors

2. Monthly business systems: EDI and catalog systems for retailers

3. Influencer agency

Do you pay yourself, and if so, how did you know what to pay yourself?

I don't pay myself as of yet. 

Would you recommend other small business owners pay themselves? 

Depending on revenue and personal finances business owners should pay themselves. It's important that founders sustain themselves while building a business.

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

I knew that we were ready to hire when I couldn't meet due dates for deliverables and there was an increase in revenue which allowed us to dedicate additional income to part-time contractors. I didn't have the bandwidth to complete deliverables on time, which is a clear sign that additional help is necessary in order to scale.

What apps or software are you using for finances? Are there any tools or programs you recommend for bookkeeping? 

I personally use QuickBooks to manage our finances, which I would highly recommend. It also has a feature that allows you to manage and pay contract workers, so that way all of the information is synced and saved in one place.

Photo: Courtesy of Àuda.B

What are some of the tools you use to stay on top of your business financials? What do you recommend for small business owners on a budget? 

I set time aside both weekly and monthly to review our expenses and revenue. The weekly meetings are used to review expenses and log receipts. Monthly meetings are focused on reviewing P&L statements and detailing expenses for the month. I recommend that small business owners review their expenses and create a quarterly budget in order to efficiently manage cash flow. 

Where do you think is the most important area for a business owner to focus their financial energy on and why? 

Decreasing expenses upfront and being “lean”. It’s important to focus on increasing revenue without having to increase expenses.

Do you think women should talk about money and business more? 

Absolutely, I believe women should talk about money and business more. Only 2.4% of venture capital funding goes to women, according to CrunchBase. There is clearly a gap within the industry due to the lack of support and knowledge for women business owners. It’s vital that we share information with one another to encourage women despite the many hurdles we may face.

What money mistakes have you made and learned from along the way? 

Paying for expensive tradeshows without building a strategy and being under the impression that sales would cover expenses. Tradeshows are very expensive, and it’s not just the booth rent. There are a lot of hidden costs on the logistics side for both the business and the tradeshow. I've learned that market research and case studies can come in handy when evaluating new business opportunities. 

What is your best piece of financial advice for new entrepreneurs? 

Build personal savings before starting your business, if possible. Create a budget from the beginning and start using personal funds to save for the desired budgets if your revenue doesn’t cover expenses. Keep all logistics in-house until your business has scaled!

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How to Perfect Your Pitch and Attract Investors with Venture Capitalist Visionary Arlan Hamilton

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In 2020, venture capital funding boomed—but women’s share shrank. Startups, overall, raised 13% more from venture capitalists in 2020 than in 2019, but female-founded companies raised a staggering $190M less in 2020 than in 2019.

As the founder and managing partner of Backstage Capital, Arlan Hamilton aims to turn these discouraging stats around. Her mission is to minimize venture capital funding disparities by investing in minority founders.

Since she founded the firm in 2015, Backstage Capital has raised more than $15 million (!) and invested in more than 180 startup companies. 

At our recent Money Moves Digital Summit, Salah Goss, SVP of Center for Inclusive Growth at Mastercard, sat down with Arlan to chat with her about her incredible career and gain her insights into how entrepreneurs can perfect their pitch, attract investors, and raise money for their businesses.

ICYMI, we’re sharing a few of the highlights from the conversation below.

Let’s start at the beginning – you have a very untraditional background compared to the traditional VC world–how did you break into the industry and set yourself up for success?

I think what actually helped me break into the industry was the fact that I was different. I'm a woman, a person of color, LGBTQ, I lived in Texas at the time, outside of the major markets, I did not go to college, I didn't have any sort of formal financial education, I did not have any contacts in Silicon Valley––and the list goes on and on. Often, I think the qualities that make us special or different that help us find success, but it takes curiosity and strength to actually lean into them.

I was interested in starting my own company at the time and excited about the prospect of fundraising until I came across some staggering statistics, including the fact that 90% of venture funding goes to white men. Demographically speaking, that means 90% of venture funding goes to a third of the country. It didn’t make sense to me. I began to ask, what if there were funds that did the opposite? 

Over the next three and a half years, I had the patience to talk to people–founders, investors, etc. I received as many ‘no’s’ as one human can get in a lifetime but I kept digging into that question, ‘what if’? I began investing in women, people of color and LGBTQ because that's what I knew. Over time, we've expanded our reach, but there are millions and millions of potential people in this demographic alone.

How do you choose which businesses to fund? What do you look for in a business and/or an entrepreneur?

It's a bit of a moving target because I feel that I continue to evolve as a persona and as an investor, but the one thing that has remained the same–from the time I was homeless and on food stamps and had no money to invest, to investing in almost 200 companies later–is this spark when I look across the table and see someone who reminds me of myself. I look for an entrepreneur who is what I call hungry not thirsty: there’s a passion without desperation. 

As far as the companies and ideas themselves go, if it's something that would take me a decade or more to even hope to accomplish then you have my attention.

It’s safe to say you have been privy to a lot of pitches and pitch decks—What are three crucial elements everyone should include in a pitch deck when raising money and why? 

1. This may be different for different people, and it will be different for different investors. For me personally, it really comes down to authenticity. You do not have to be an extrovert or try to entertain me. It's not necessarily about having a talent for being an entertainer, but rather a combination of pragmatic and passionate, and being able to articulate their story in a way that allows me to dream with them. As Katy Perry says, the best storyteller wins.

2. I speak with thousands of companies and receive thousands of pitch decks a year. I better not know more about your company than you do–or about your competition. Before you go out and ask other people to invest in you, you better invest in yourself and look for the answers in all the different ways that you can. Learn and talk to your peers and talk to people who have been there before you. Talk to the CEOs of fortune 500 companies and find mentorship through other people who are maybe slightly ahead of you in the game or through people who are doing this all with you. There's something that they figured out, or that they learned, or that they heard about that can help you––and you’ll probably help them too!

3. I understand that for some, it’s not only pitching a business, it’s their livelihood. But when I continue to ask someone more questions, it means I’m interested, even if the questions are tough. Sometimes people will shut down, get defensive, or quick to end the conversation when they feel it’s too much work to find the answers. Remember that you're also asking people for tens of thousands, hundreds of thousands, maybe millions of dollars, so that's going to be part of the process and you have to be prepared to put in the work. 

Black women are among the fastest-growing entrepreneurs in the U.S.—yet they only receive a fraction of venture capital funding. How can we turn this statistic around and ensure the small business community is actually representative of society as a whole?

That’s a lot of what we're doing at Backstage and hopefully we’re one of many. It has to start with a global conversation and understanding that when companies are backing black women, they're also backing a progressive infrastructure, they're backing healthcare, they're backing all sorts of innovation. It’s not just what the country can do for black women to repair damages, it's also what black women are going to do for the country–and what they have been doing.

5 of Your Most Pressing Money Questions–Answered

Photo: ColorJoy Stock

COVID has shown us how quickly unexpected events can throw our plans off course. Now, more than ever, it’s important to plan ahead–especially when it comes to your finances. Whether you're bootstrapping your business, setting up your retirement fund, or simply learning the financial basics, it pays to pay yourself forward. Investing in your future will pay back dividends. 

To help you master your own financial future, we teamed up with Ally for our recent Money Moves digital summit to host a mentor power-hour with five financial experts to answer your most pressing money questions.

In case you missed it, we’re sharing a few of the Q&As from our Money Moves mentor session. Read on for some sage financial advice from our five mentors who know quite a bit about the importance of investing in yourself, your business, and your financial future.

Jack Howard serves as the Senior Director of Wealth Advisors Operations for Ally Invest.  In this role she manages the day-to-day operational processes of the Wealth Advisor business.  She is also responsible for the Ally Invest Inclusive Wealth strategy that is part of the Ally enterprise Financial Social Inclusion (FSI) efforts and serves as secretary for the Ally Charitable Foundation. Prior to joining Ally Invest, Jack served as Senior Director of Ally Corporate Citizenship.  She was responsible for the creation and execution of strategic programs for the organization’s financial literacy program, corporate giving initiatives and employee giving/volunteerism programs. 

Jack graduated from Michigan State University with a Bachelor of Arts degree in Journalism and is currently a student in Syracuse University’s Master of Science in Communications Management program. An active professional, Jacqueline is a member of Alpha Kappa Alpha Sorority, Inc. and Jack and Jill of America, Inc. She also serves on the national board of directors for the American Bankers Association Foundation and Society for Financial Education and Professional Development (SFEPD), as well as the Boys and Girls Club of SE Michigan.

Jacqueline has a deep passion for helping Brown and Black communities build wealth through economic mobility. Her work has earned her a spot as one of the 15 women on the inaugural Next list - an extension of the American Banker Most Powerful Women in Banking program.

Q: Investing can be intimidating–what advice do you have for someone who’s new to investing and doesn’t know where to start. How do I overcome the intimidation factor?

JACQUELINE: As a first-generation stock investor, I know what it feels like to be paralyzed with fear because you don’t know what to do first. I am the daughter of a police officer and teacher who had pensions to fund retirement, so the stock market was not a topic of discussion at my dinner table during childhood. After graduating from college, I realized the importance of owning stocks as a piece of my wealth building strategy. I started small and made a $25 contribution to the 401K provided by my employer. As my salary increased, I contributed more, hired a financial advisor, and opened a Roth IRA account.  I also worked hard to eliminate credit card and student loan debt.  Over time, I became obsessed with understanding money and wealth building.  Now, I am constantly listening to audio books and podcasts, watching CNBC or reading the Wall Street Journal and Barron’s.  All of those efforts helped me to better understand money and investing.  So, my top tips for new investors: start small, automate the process and make a commitment to learning.

Allyson Byrd is also known as the “Profit Accelerator™ and she is celebrated as one of the world's most trusted leadership advisors and sales experts for entrepreneurs and small business owners. Today, her and her team executive produce exclusive virtual membership communities for influencers with online audiences over 1 million in reach. Allyson’s clients generate a collective $33 million-plus in sales revenue annually. She and her team have coached 7500 entrepreneurial leaders to create $260 MILLION in NEW revenue over the past 9-years. You’ll be able to hear more of Allyson’s journey to success from an underprivileged life on food stamps, a dad in prison and single mom raising two kids to the ultra-passionate successful leader she is today and the undeniable stand she has for women rising into their greatness in her latest collaboration with Amazon Prime TV. Allyson’s press features include CNN, USA Today, NPR, Time Money, Forbes, Yahoo Finance, Business Insider, CNBC, MSN, Black Enterprise, Essence and Entrepreneur.com.

Q: If this last year taught us anything, it was the importance of planning for the unexpected. As a small business owner, how can I be better prepared financially for emergencies?

ALLYSON: The last year taught us many lessons and brought significant stress to women business leaders all over the world. We found ourselves questioning how to properly position our services, pivot our product lines and staff our teams amidst a global pandemic and a world-wide racial reckoning. This was not easy, but we survived. 

There are (3) things that I shared with our clients averaging $250,000+ annually to keep them on track and committed to success. 

1. When money stress hits, do NOT discuss the stress. Focus on the pivot. Ask yourself, “What is my lowest hanging fruit to sell and position to the market?” Your job is to sell with intention, sell fast and secure your cash flow.

2. Get LOUDER in your marketplace. Our tendency when stress hits is to go quiet and enter protective mode. Choose from a place of power and connect with your audience like never before. Do the things others aren’t doing so you can curate success for your business in ways others are not. 

3. Finally, as the business leader–center yourself. Know your numbers, meet with your accounting team (bookkeeper, accountant, heck… this may be you having a meeting with you) but whatever you do, don’t hide behind your numbers, stand on them. Have a clear picture of where you are so you know where you’re taking the business. 

Financial stress can cause us to take our mind off our business goals, slide away from leading with discipline and throw us quickly into a state of overwhelm and fear. 

Use affirmations like the one below to kick off your breathwork or meditation because if you’re riddled with anxieties and high-stress emotions, your business and your bottom line will soon follow.

REPEAT AFTER ME: I am a vibrational match for financial prosperity because I choose to only allow massive well-being. I stay in the place of already receiving monetary abundance from all sources that are for my highest good and greatest joy.

Stay the course. It’s the ebb and flow of business and keeping your mind centered, your energies focused and your intentions clear will get you through the storm and back into the sunlight of your success. 

Britney “Jeanine” Canidate is the owner and founder of Britney Jeanine & Co., a business coaching firm based in the heart of Atlanta, Georgia. Serving as the head Business Coach and Pivot Strategist, Britney believes that every entrepreneur should build a business they are most passionate about—even if it means slapping fear in the face and pivoting accordingly. Wife, mom of 2 and a business owner for over thirteen years, Britney has established herself as an industry leading business and brand strategist, and has supported clients across a multitude of industries. From corporate executives, high-ranking government officials and thousands of creative entrepreneurs, Britney has intently positioned her expertise in order to build a business focused on greater results, revenue and retention. Known for her spunky-tough-love approach, creativity, strategic mind and attention to detail, Britney is a proud graduate of Georgetown University where she received her Masters in Public Relations & Corporate Communications, and a Florida State Seminole with a background in Finance & Marketing. Using her signature system, you can find Britney working with experienced [yet transitioning entrepreneurs] who are ready to confidently plan their pivot without compromising their coins and credibility.

Q: I am currently working full-time for an employer but I plan to launch my own business soon–where is the most important area for me to focus my financial energy right now in order to take the leap?

BRITNEY: What a great question... and it's awesome that you're starting to think of this now. A mistake I often find those starting new businesses make is: investing based on what others are doing, and not based upon their OWN goals/needs.

So here is my advice:

• First define your brand by outlining your what, why, how, who and who not.

• Then focus on the who and determine how you can solve their problem(s).

• Now that you have the solution to their problem(s), package it up... is it a product, service and/or program...

• Now it's time to launch it into the world... who are the key people that can help you make this happen?

So to answer your initial question... your financial energy will go into "the key people that can help you make [your launch] happen".

 Maybe it's inventory samples? Maybe it's a business coach? Perhaps it's a brand designer or operations strategist... but the question still remains—who are the key people that can help you make the launch of your new business happen? Start there.

Alaina is an accountant, certified financial coach, author, and content creator. She helps busy people who struggle with budgeting and time management use a paper planner to get organized. She shares her easy approach to productivity & finances through her YouTube channel and has amassed over 75,000 subscribers and 3.5 million views on the platform. Her work has been featured in Yahoo Finance, Martha Stewart Living, Wired, The New York Weekly, The Huffington Post, and she was recently selected as one of LA Wire's 40 under 40. Alaina lives in New Orleans, Louisiana with her husband Torrey and their two daughters Tori Michelle and Alyssa Jade.

Q: I’m reevaluating how I split up my finances in the wake of 2020. How much cash should I keep in my savings and checking account?

ALAINA: Here is how I break down cash in my accounts:

Checking Account: I keep a small cushion in this account (no more than $200 - $500) just to cover any unexpected expenses from my daily spending. I don't like to keep more than that just in case my debit card is compromised.

Short Term Savings Account: With my short-term savings account, I am keeping money for any repairs or things that don't happen every month (like birthdays). In this account I keep one month of expenses. 

Long Term Savings Account: This is my emergency fund. I would keep 3 - 6 months of expenses in this account in case you may lose your job. If you have a very secure job or you can get a new job very easily, I would keep 3 months, however if you are self-employed or your job is unstable, I would keep 6 months of expenses.

Savvy Girl Money is a financial platform created to inspire women to reach their financial goals.

Q: I’m saving up to buy a home, but I’m worried that my credit score is too low. How can I increase my credit score and maintain it?

ASHIRA: The best way to increase and maintain your credit score is to start paying all your bills on time. A late payment can have a substantial effect on your score.

You want to keep your credit card utilization ratio under 30%. Your credit card utilization ratio is calculated by dividing your credit card balance by the total credit card limit. Make sure each individual credit card utilization is under 30%. Credit utilization makes up roughly 30% of your credit score, this makes it one of the most important factors in increasing or maintain your credit score.

You could also dispute negative or inaccurate items reported on your credit report. The best option is to write a letter to the three credit bureaus explaining why the information is inaccurate and provide evidence. Make sure to mail the letter certified mail with return-receipt requested as proof you sent the letter.

Why Adopting This Simple Money Mindset Could Change Your Life

Photo: Smith House Photography

“Did I really just do that?”

That was my immediate thought after hiring my first business coach a little more than a year ago. It was the most money that I’ve ever spent on myself—$7,000 to be exact—and honestly, the most money I had spent on anything in my life.

Putting that amount down was scary beyond belief. I thought I was crazy, but I was also done playing small. I was done thinking that I or my vision wasn’t worth it. I was done having a money mindset that dollar bills were scarce and hard to earn.

And I knew deep down that to get a return, I would need to invest. In myself. Pretty big jump considering that at the time I felt hesitant to spend $35 on a workshop. But this is what I realized: money is meant to be in a healthy cycle of giving and receiving, making and spending.

If one part of that cycle is blocked, like when you try not to spend money at all or don't ask for what you're worth, the whole cycle gets thrown off and creates a clogged financial situation that feels strained and uncertain. Maybe you’re good at spending money, but if you feel guilty about it, it blocks the flow just as much. Spending and investing your money should feel good. 

So here’s a thought that can turn things around…

"There's always more where that came from."

This mindset reminds me that whatever I spend or invest comes back to me in some way. If I end up paying more on a dinner bill split among friends, I’m convinced it'll come back to me in some way. If I invest in an online course, I believe a return will come back to me in some way.

But without some sort of initial investment, there can’t be a return. And if all or most of your money is going towards rent, food, and Ubers, with little to no personal development expenses, you’re missing out on one of the biggest ways you can change your life. 

As a life and business coach, I've worked with dozens of women who, at first, had a strong resistance to spending money on themselves, and here’s what one of them has to say about this:

“Working with my coach has confirmed that I am worth investing in financially, emotionally, and spiritually. I’m worth that investment, and because I’ve decided that I’m worth it, I’m reaping the benefits, and that investment is being returned to me in the form of clients, improved relationships, and a better version of myself.”

So, if spending money on yourself feels selfish or indulgent, ask yourself these questions: 

1. Are the financial decisions I’m making right now leading towards the most fulfilled version of myself? 

2. Are they helping me reach my biggest goals and dreams?

3. Are they amplifying my impact in the world along with my quality of life?

If you answered no to some or all of these questions, what could you invest in to help you grow and develop financially, emotionally, or physically? Maybe it’s by investing in the online therapy you’ve been thinking of, your own business coach, or a personal trainer that you’ve been dying to work with. 

If at least a portion of your disposable income goes towards those types of expenses, then you’re bound to have a more fulfilling life. So don’t hold yourself back by not investing in the things that’ll help you grow.

It’s not self-indulgence. It’s self-investment, which is arguably the best expense on your bank statement.

About the Author: Kimberly Lucht is a life and business coach who helps female entrepreneurs make their dream business a reality. Degree-trained in psychology, Kimberly has previously directed and grown start-ups that help women blast through limitations and go after their dreams. As a life coach now, she has helped dozens of women massively increase their income, productivity, and overall fulfillment in life through in-person workshops, online programs, and one-on-one coaching. Kimberly has been featured in Money.com, Thrive Global, along with a variety of other media outlets and she currently lives in New York City.

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This story was originally published on September 13, 2019, and has since been updated.

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Why This Founder Wants You to Adopt a "Profit First" Mentality

Photo: Courtesy of Caroll Lee

Being a small business owner means always being flexible, able to pivot quickly, and willing to veer from the plan as needed. The COVID-19 pandemic certainly put those skills to the test this year, and my team at Provenance Meals was able to step up to the task and propel us forward. 

Before founding Provenance Meals, I was a certified holistic health coach in Brooklyn. I encouraged my clients to follow a simple elimination diet replacing processed and packaged foods with wholesome ingredients, and their overall health, vitality, and energy levels dramatically improved. But finding the ongoing time, motivation, and know-how to cook healthy meals at home—and sustain these life-changing benefits—was a challenge for most everyone I worked with, and I knew I could help. After finding this clear gap in the market, I launched Provenance Meals in 2012, making it easy for time-pressed humans to achieve their wellness goals, nourish their bodies, and replenish their spirits with 100% gluten-free, dairy-free, and refined sugar-free meals designed by wellness experts, and made from scratch with thoughtfully sourced, local ingredients.   

Launching Provenance Meals was not my first entrepreneurial venture—I invested my heart, soul, and just about all of my savings into a small gourmet market in 2016 that sold semi-prepared, organic meals to busy New Yorkers. Shortly after opening, my business partner decided that to back out of our business deal and sue for all of the money she had invested. It was an incredibly stressful time, and I went into a great deal of debt to buy her out, but I appreciate that the experience taught me valuable lessons that would help propel me to launch Provenance Meals.  

The biggest lesson I learned was to maintain a healthy cash reserve to stay afloat through unforeseen challenges. Since then, I have followed the “profit first” mentality, setting aside money for a small profit and taxes from our sales, and only then allowing myself to spend what was leftover to operate. I didn’t know anything about raising money or wooing investors when I opened my first business. As the daughter of immigrants, I was taught that to get ahead, you must work hard, spend frugally, and save money. Now I also know that you need to start with a business model and unit economics that work from the get-go, and you will be that much more prepared for emergencies in the future. 

This system is how I’ve been able to bootstrap Provenance Meals without relying on investor life support. We have been profitable since launch, with $0 raised until this year's community-driven campaign on Republic, our first-ever fundraising effort (at 742% of the minimum goal), which allows for angel investors and Provenance Meals' longtime community members to buy a stake in the company. Since our nationwide launch this spring, we’ve seen revenue increase 78% month over month. 

For small businesses looking to expand their brands during a time of uncertainty, here are some additional pieces of advice that have served me well over the years: 

React quickly and assertively in the short term.

But be aware of longer-term consequences. Right when COVID-19 hit New York City in the spring of 2020, we realized quickly we needed to pivot to meet our community’s changing needs (as many New Yorkers fled to second homes). We expanded our local courier zones in New York to include Connecticut, Westchester, and Long Island in order to follow our clients, and have seen demand soar in these regions. This led us to begin shipping nationwide and expand our offering to include new products. Because we’re now in a position to reach a larger audience and garner higher total revenue, we’re able to lower prices to make our products more accessible—our Daily Essentials program now starts at $52/day (originally $68).

Double down on your values.

Don’t be wishy-washy when it comes to why you do what you do. Your mission statement, your company’s core values, and your voice are your “North stars” in making business decisions. The more authentic you are about why you’re doing what you’re doing, the more you’ll love your business and the more you’ll attract customers. I see so many starting founders comparing themselves with other entrepreneurs. Truthfully, we’re all figuring it out as we go along! Stick to what makes your business uniquely your own and you’ll find success in your field. 

Celebrate your strengths.

A perfect company, strategy, or plan doesn’t exist, but what does exist is my own confidence in the future, which I pass on to my team. I like to think my perpetual optimism helps show everyone how bright the future can be and inspires my team to share the dream with me. That’s one of my strengths as a leader. What are yours? Celebrate your strengths and use them to your and your team’s advantage.

Balance is key.

As the founder, in many ways, you are the business. When you take care of yourself, you’re also taking care of your business. Having two young children when I first started Provenance, I had no choice but to prioritize my family. The process was a stressful juggling act at the time, but in retrospect, forced me to be fully present in my home life and separate my work life. Over the years, I’ve learned strategies to cope with the stress and holding the responsibility of my business and my staff’s livelihoods on my shoulders, with practicing presence and meditation at the top of the list.

Give back where you can.

The coronavirus pandemic has exposed a lot of problems that already existed in the food industry, including the tremendous amount of food waste, the working conditions of farm and factory workers, the tenuous nature of the hospitality industry, how the way we grow and eat food affects global climate change, how representation matters, and the amount of food insecurity that exists in the United States. As Provenance Meals grew, we knew that we wanted to prioritize giving back to our community. We forged a nonprofit partnership with Kiss the Ground, underscoring our mission to support independent farmers and further provide widespread access to nutrient-dense ingredients. 

Founding and running my own business is a dream come true. I have so much pride in what my team and I have built, and feel like we’re only just getting started. Especially in challenging times such as these, I rely on our spirit and determination to further our mission to improve the health and lives of others through the power of (delicious) food as medicine.

About the Author: Caroll Lee launched Provenance Meals to make it easy for modern, time-pressed people to achieve their wellness goals, nourish their bodies, and replenish their spirits. Caroll believes nutrition is the bedrock for feeling good, performing well, and living a longer, happier life. She launched the meal program in 2012, and in eight successful years, Provenance Meals has amassed a dedicated community, including noteworthy fans like Naomi Watts, Taryn Toomey, and Rachel Brosnahan. The nourishing, anti-inflammatory food offerings are all 100% gluten-free, dairy-free, refined sugar-free, and composed of organic, local ingredients.

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This Mom Founded a Kid’s Clothing Company to Spend More Time With Her Family

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Fiona Sahakian

In 2010, Fiona Sahakian was a hairdresser and new mom working long hours and daydreaming of spending more time with her growing family when a client introduced her to Etsy. “I was so intrigued by working from home and using my creativity to generate income through a platform,” Sahakian tells Create & Cultivate. Less than a year later, she launched the first iteration of Posh Peanut, a line of handmade accessories that eventually evolved into the beloved children’s clothing brand that it is today.

Fast forward to 2021 and Posh Peanut is a favorite among celebrity moms by the likes of Chrissy Teigen, Gabrielle Union, and Eva Longoria, to name just a few. If you’re not an A-lister you can still add the brand’s coveted pieces to cart—but you’ll have to act fast. Last year, Posh Peanut launched at Nordstrom and Saks Fifth Avenue, and the brand’s weekly collection drops have been known to sell out within five minutes (!). But the business wasn’t an overnight success. “I funded my business one sale at a time,” the founder explains. “I spent $500 from my own account for my first ‘big’ inventory purchase. Every sale and every dollar went back into inventory.”

Ahead, Sahakian talks about what it takes to slowly but surely build a successful brand and why hiring an accountant ASAP will save you money in the long run.

Take us back to the beginning—What was the “lightbulb moment” for Posh Peanut? What inspired you to launch your business and pursue this path?

I really wanted to stay home with my growing family. I was a hairdresser working crazy hours over the weekends. When I had my son in 2010, a customer turned me onto Etsy and I was so intrigued by working from home and using my creativity to generate income through a platform. Posh Peanut has evolved over the years from handmade accessories to the softest essentials you can imagine. Although I now work more than ever, it has given me the opportunity to also work on my own terms and around my kids’ schedules. 

Today, Posh Peanut is beloved by celebrities including Chrissy Teigen, Gabrielle Union, Mindy Kaling, Eva Longoria, and more. How did you create buzz around your business in the beginning?

In the beginning, we had no marketing budget but we used social media outlets to rally up fans and our community. Our community built the buzz surrounding our coveted designs with lots of hashtags and resharing. 

Last year, Posh Peanut launched on Nordstrom and Saks Fifth Avenue. Congratulations! What has been the biggest challenge in scaling your business and what lessons have you learned along the way? What advice can you share on how to scale a business sustainably?

Our biggest challenge has been keeping up with demand and diversifying our supply chain. Our collections are known to sell out in 5 minutes and our production lead time is 8-12 months out on the calendar. We have had exponential growth in the past two years. Finding new supply chains to meet our growth and finance the business has been our biggest hurdle. We are 100% bootstrapped, and in order to scale to our projected numbers, we need capital.

We have been lucky to have great relationships with our suppliers and banks, and have learned that it is better to grow slow and sustain that growth rather than raising a bunch of capital. We don’t put ourselves in a corner or bite off more than we can chew. I suggest negotiating with your suppliers, banks, and find funding yourself if you do not want investors. There are many great lending programs in the e-comm space. 

How did you fund Posh Peanut? What were the challenges and what would you change? Would you recommend that route to other entrepreneurs? 

Don't run, walk. I funded my business one sale at a time. I spent $500 from my own account for my first “big” inventory purchase. Every sale and every dollar went back into inventory. I didn't pay myself out until many years later. I was lucky enough to have a supportive husband. I also kept my job as a hairstylist until I was able to save enough to focus 100% on Posh Peanut. I didn’t take any loans out or seek investors. 

This path of course is a slow growth, but I wanted to be self-funded. I think many entrepreneurs seek out funding very early on without getting their feet wet. As we scaled, it did become more difficult and with larger inventory purchases we needed more capital. I don’t think I would change the way we funded the business. Although it took us a bit longer to scale, I think it taught us a great lesson of not over-investing in products, growing too quickly, and then figuring out how to sell them. Slowly growing taught us to invest in the correct places. 

Where do you think is the most important area for a business owner to focus their financial energy and why?

Payroll. I think you can add tons of people to your team who don't add value, making your financials top-heavy every month. 

What was your first big expense as a business owner and how should small business owners prepare for that now? 

Inventory. Inventory was our biggest investment but also the only way to sell. Negotiate. Negotiate. Negotiate. If you are a product-based company, your inventory will always be the biggest expense. Ask vendors for terms, don't bite off more than you can chew. You can always buy more and replenish when you see demand.

What are your top three largest expenses every month?

Payroll. Inventory. Paid media.

Do you pay yourself, and if so, how did you know what to pay yourself? 

I started paying myself four years ago. I didn't pay myself in the beginning as I used all the money to fund the business. However, every time I hit a goal of X I would take a little bit of the revenue and spend it on myself on something I really wanted. I believe in setting goals and rewarding yourself with a gift, trip, or whatever that thing is that really motivates you to get to that next step.

Would you recommend other small business owners pay themselves? 

If you can, yes! I was lucky because my husband had a good job and paid for the necessities and I was able to save all of Posh Peanut’s earnings to pay for the business expenses. I was able to put every dollar made back in the business. I don't see a wrong or right answer. It's how your personal financials pencil out while sustaining the growth of the business.

Did you hire an accountant? Who helped you with the financial decisions and setup? Are there any tools or programs you recommend for bookkeeping?

We did hire an accountant early on. He helped set up our corporations and made sure our finances were aligned. I did not do any accounting or financials in-house. We did hire a controller a few years ago as the company was scaling quickly. I think hiring an accountant or financial advisor is very important as soon as you see traction in your business. You'll save more money outsourcing finances than trying to do it all yourself. I know how to make the money but I would never have been able to scale without the guidance of professionals.

What apps or software are you using for finances? What’s worked and what hasn’t?

We currently use Avalara for all of our e-comm state taxes and our controller does all the other finances through our ERP system. 

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

Jack of all trades, master of none. When you get to the point of, “Oh, shit,” you need to hire someone ASAP. You have to spend money to make money. Unless you have a degree in finance or lived in this space, don’t try to carry everything on your shoulders. Having a great accountant, CPA, etc. will save you a lot of money in the long run. 

Do you think women should talk about money and business more? Why? 

Yes! Yes! Yes! Why not? Women need to start sharing their experiences more and talk about capital. In a male-dominated space, it is incredibly nice to find other women you can relate to. Hopping on a call to get advice from another woman that understands the struggles is refreshing. You don't feel alone. Women are often more reserved or don't want to ask questions. I wish more women would find confidence and open up with what they are doing in their space.

You’re a mom of two and a founder! How has being a mother changed your priorities and your focus in terms of your career? Do you think motherhood has made you a better business person?

I always say I have three babies, my two kids, and my business. I love what I do. I love my kids to death but I also love working, building teams, and creating community. My career has made me a better mother. My schedule is always run, run, run, but my kids understand why I am doing it, and in the end, it's for them. When I am not working, I am 100% with my family. My career has taught me to slow down and do everything 100% with intention. Especially with my kids.

Do you have a financial mentor, and do you think business owners need one?

Yes, we have consultants for finance. I think when you become seasoned in your industry it's great to have different eyes and mentors in all aspects of your business.

What is your best piece of financial advice for new entrepreneurs?

Know your numbers.

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The Simple Trick That Helped Me Double My Income in a Month

Photo: ColorJoy Stock

I’ve always felt chronically underpaid. With a master’s degree in history and a passion for social media marketing, I applied for 347 jobs in a single year before I got my first “real” job (yes, I kept a list)—working four part-time jobs at once during that time—and my first-ever salary clocked in at a whopping $30,000. I thought I’d struck gold, and I foolishly believed that my salary was going to be enough to pay for rent in Nashville, living expenses, insurance, my phone bill, building a savings, and the massive chunk of student debt I had after earning two degrees. 

After my dream job turned out to be a nightmare, however, I started to get desperate. I took a part-time paid internship at a publishing company hoping to turn it into a full-time position and—surprisingly—it worked. A month later, the owner of the company pulled me into his office and asked me if I wanted a job taking over as the director of marketing.

Obviously, I said yes. I went from intern to leading a department overnight, and I happily accepted the $35,000 salary—completely unaware that it wasn’t anywhere near the industry standard—and clung to the promise of a raise within six months. Six months later, armed with countless spreadsheets and a report on everything I’d accomplished on behalf of the company, I walked into my boss’ office and asked for my promised raise. 

And he laughed at me. 

Even though I quit the job soon after, I’ll never forget that moment or the way it impacted my career (and more importantly, my salary growth) from that point on. Even though I knew I should negotiate, I found myself wavering in every conversation about money for years to follow. At my next job, when I discovered that my predecessor had been paid a whopping $25,000 more than I was, I accepted it—telling myself that they’d get me up there eventually—but after two years spent trying to prove myself worthy, I was told to “be grateful” for the amount I was given.

Eventually, I started believing that I would never break past $50,000. It was too much—too high to achieve—and despite ten years of experience, two director-level positions, speaking gigs, and a slew of clients who were obsessed with my work, that belief turned out to be a self-fulfilling prophecy. No matter what I did, no matter how many books or courses or life coaching sessions I took, the line didn’t budge. And my self-worth tanked.

I’d always believed that something was better than nothing, so I found myself accepting every opportunity that came my way. A freelance writing gig that barely paid above minimum wage? I’ll take it. A $3,000 class that promised to teach me how to build a successful online business? I’ll buy it. An unpaid speaking gig? I’ll do it. I wrote and published my first novel. I launched a podcast. I created digital products. I sold an online course. I hustled and created and pushed myself to do more, but no matter how much of myself I gave away I felt like I couldn’t get anything in return.

I barely made $10,000 during my first year of self-employment. 

Eventually, I knew something had to give. Work felt like I was attempting to lift a 500-pound weight, and—even though it wasn’t budging—I was constantly exhausted from the effort. Instead of letting myself continue to feel like a failure while half-heartedly juggling everything I’d built over the past several years, I made the difficult decision to let everything drop. I was grateful and privileged enough to have a partner who kept most of our finances afloat, so I maintained my core clients and said goodbye to maintaining my podcast, my writing, my social media platforms, my course, and more. I needed time to decide whether or not I even wanted to pick those things up again, or if I was ready to admit defeat.

Barely able to function, I remember telling my therapist that I was ready to give in, but that I wasn’t sure how I could survive a desk job. Over the last three years, I’d learned to love my independence and my ability to set my own schedule, and I was terrified that the only way I could be “successful” and hit that $50k mark was if I threw myself into a 60-80 hour a week corporate job that obliterated my free time...and my happiness.

“Forget the $50k thing, that’s a separate issue,” my therapist said. “What is your time worth? Not just the time you’re working, what is your free time worth?”

“Like, hourly?” I asked. 

She nodded. 

If I was honest, I didn’t spend a lot of time thinking about my hourly rate. I accepted whatever was offered because I was grateful for the work, and the idea of my free time having a dollar amount next to it didn’t sit well. Why would it have an hourly rate attached to it? It’s just the time I wasn’t working. It doesn’t have worth. 

Except it did. If my time had value—and even my free time had value—then that could change everything I did, and not just in my career. Later that day, I told my partner about the question and he asked if I had an answer. I laughed awkwardly and joked, “I don’t know. Seventy-five dollars an hour.”

It was more than double the amount that I was making as a freelancer, but it was a joke—it wasn’t real—so it felt safe to dream. It was just a post-therapy conversation, after all, not a quote for a potential client, so it didn’t mean anything...until I found myself watching a movie on Netflix that I didn’t even enjoy and wondered, “Is this worth $75 and hour?”

It shocked me when the answer was no.

Slowly but surely, I found myself asking that question more often than not. It shaped my decisions of how I spent my time, and I realized just how much time I was wasting on things that didn’t even bring me joy. It was like I was Marie Kondo-ing my free time, and—while sometimes the answer was a resounding yes, like when I took a much-needed break to play three hours of Animal Crossing on my Nintendo Switch—it changed the hobbies I engaged in, the people I talked to, and even my business. 

I started saying no to low-paying work. I ditched the mentality that something was better than nothing and started looking for clients who could afford to pay me more. I quoted higher than I ever had, and within a month I doubled my income. Eventually, I realized that I was earning the same amount of money working part-time that I made at my first full-time job. I was ecstatic, and I even started turning away work that no longer fit my goals. Because my time had value, because I had value, the decisions I was making as an individual and as an entrepreneur started to change.

Slowly but surely, I stopped undercutting myself at every turn. Over the next few months, my business exploded. I doubled a massive proposal to a new client at the last minute—fully expecting them to negotiate for a lower rate—and was stunned when they accepted it as is. I hired an assistant, plucked up the courage to fire a client who was mistreating me, and even walked away from my lowest paying gig.

In the end, I realized that feeling underpaid was just that: a feeling. I didn’t have a $50,000 upper limit. I was my upper limit. I was the one holding myself back, I was the one consistently accepting less, and I was the one who let my imposter syndrome talk me out of tens of thousands of dollars. It was only once I decided what I was worth—and owned it—that other people could see it too.

“I ditched the mentality that something was better than nothing and started looking for clients who could afford to pay me more.”

—Jandra Sutton, Founder of The Wildest Co

About the Author: Jandra Sutton is a writer, entrepreneur, and founder of The Wildest Co, a creative agency specializing in content creation, branding, and marketing for busy entrepreneurs and small business owners. She's also the host of The Wildest Podcast, a weekly personal development podcast in 10 minutes or less. You can follow her on Instagram @jandralee.

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10 Money Questions to Ask Yourself (So You Can Afford the Life You Want)

What is your relationship with money? Do you love to save and budget for the future, or are you all about enjoying that hard-earned money and prepared to go into debt for it? Either way, we need to get better at talking about it if we ever want to be better at managing it, and eventually having more of it. Especially when you consider that globally, women control upwards of $20 trillion in annual consumer spending. But sadly, when it comes to managing money and planning for their financial future, women aren’t as independent as you’d expect. A study found that more millennial women cede control to their husbands than women of older generations. Well, our new series, The Money Files is set to change all that by helping women become masters of their own finances so they can manage their money and their future.

Photo: Smith House Photo

Money. We all love spending it and we all want more of it, but saving it is the hard part. It’s not that we don’t want to see more money in the bank (duh) but striking a balance between saving for the future and living the life you want isn’t always an easy one to master. Too often, the pendulum swings farther into the spending camp and before you know it, you’re in the red and playing catch-up with the interest charged on your credit card debt.

Don’t worry, we get it. That’s why we asked Priya Malani, partner of Stash Wealth, to help us all get our finances in order. So, she sent us 10 important money questions to ask ourselves so we can bank that cash, pay off that debt, and live life like a millionaire (well, that’s the dream).

1. What can I realistically do to improve my income level?

Negotiation is never a bad idea as long as you’ve planned for it. Most managers plan for you to negotiate and so there’s wiggle room in your salary range. An annual negotiation is perfectly appropriate. Use the months leading up the conversation to prime your manager and document the proof that you’ll use when going in for the ask.

When is a negotiation not smart? When you go in cold and demand a raise. You’ll want to have data to support your request and documentation of your value-add (even if it’s qualitative, not quantitative). Stay factual and unemotional and above all, leave politics at the door.

Side note: IMHO, wanting to upgrade your lifestyle is not a strong reason to demand a raise. I was recently speaking to someone who was advised to use this strategy and as a business owner, I can say that not only would it not work, but it would leave me with a poorer opinion of the employee’s ability to #adult. Taking e-courses that are tangentially related to your field is an excellent way to demonstrate a commitment to increasing productivity and value and certainly supports your case for a raise.

2. What can I do to reverse bad credit and get my score back on track?

This may sound counterintuitive but start using a credit card and paying it off in full every single week or more often. This is one of my favorite FICO hacks (FICO is an abbreviation for the Fair Isaac Corporation, the first company to offer a credit-risk model with a score). It’s a quick and easy way to positively impact one of the most important parts of your credit score—your credit utilization ratio. Make sure to never charge up more than you can pay off.

If your credit cards are maxed, find ways you can pay down that debt ASAP. Consider selling stuff on FB Marketplace or via Poshmark, getting a roommate, cutting any unnecessary expenses that may free up cash that you can put towards your debt. And once you find the extra money, set up a regular debt repayment automation, so you don’t accidentally spend it.

If you want to explore other actions that may bump your score, download the CreditWise app (it’s free) which includes a credit score simulator. It shows you how different actions will impact your credit score before you actually commit to doing them. I’m a huge fan of this app and use it myself.

3. How much should I be saving for retirement?

There’s no easy answer here because retirement is not one-size-fits-all. You can start by using an online calculator to find out how much you’d need to put away to ensure you’ll replace a portion of your current income by the time you hit your desired retirement age.

Here are the main things you need to think about:

• How much you earn now?

• Is it just you in retirement or are you providing for someone else?

• At what age do you want to retire?

• How long do you expect your retirement to last (aka life expectancy—MORBID, I know!)

Once you determine these things, you’ll have the major inputs that will help you decide how much you should be putting away for the exact retirement you picture for yourself. Yes, it’s very hard to picture what your life may look like years from now, but I have three words for you: Playing. Catch-up. Sucks.

4. If I’m planning on having children, how can I ensure I have enough funds to take care of them on one income? When should I start saving for their schooling? 

A good exercise is to stash away 10-15% of your income today and see how it feels. That’s the percentage of your income that will go toward your children for basic day-to-day expenses (not including schooling). If you feel you can manage on 85-90% of what comes in the door, that’s a good indication that you have room for kids, financially.

When it comes to saving for school, it all depends on how much support you want to provide them. 100% of four years at a private institution? 50% of four years at a public institution? Once you have a sense of what your priorities are here, you’ll be able to back into your savings goal. Add that savings goal to the 10-15% I spoke about earlier and plan to live without that money—is it doable? If so, start saving as soon as possible.

Once again, it’s no fun to play catch up and the longer you wait, the more you’ll have to save to be on track for your goal.

5. What would happen if my spouse passed away? How can I plan for that?

This is a not-so-fun thing to think about and plan for but it’s pretty important to do so. When it comes to the financial support your spouse provides, the first step is to decide whether you feel dependent on your spouse's income or if you own property or have kids together. If so, life insurance may make sense. A life insurance person can help you evaluate how much coverage to obtain to ensure that if your spouse passes away, you wouldn’t have to change your lifestyle, in other words, you’d still be able to pay your mortgage and take care of your children in the same way you are now (monetarily speaking).

“Yes, it’s very hard to picture what your life may look like years from now, but I have three words for you: Playing. Catch-up. Sucks.”

6. When should I start investing money? And how do I know what to invest in?

This question deserves a whole article in and of itself. But the long and short of it is this. Investing is a way for your money to grow over time, not overnight. If you think investing leads to a “quick win,” you’re thinking about it all wrong. Wall Street loves to portray investing more like gambling but the fact of the matter is that the sooner you start investing, the more successful you’ll be because money grows with time and you need to be patient for it to work. 

As far as what to invest in, this is another area that Wall Street (and the media) portrays completely incorrectly. They make it seem like you're supposed to pick stocks and trade frequently when the opposite in fact is true—slow and steady wins the race. If you’ve ever heard of index funds, you’re on the right track.

Investing is a means to accomplish your financial goals and so technically, no one should tell you what to invest in until they know what you’re investing for. Goal-setting is the first step to knowing what to invest in.

7. How can I save for a house? What do I need to do?

Speaking to my point above, the first step to take is to commit to homeownership as a financial goal. If you’re in a relationship, you’ll want to have this conversation with your significant other. Define the timeframe in which you’d like to accomplish buying a home. Using sites like Zillow can help you evaluate what kind of home you’d like to buy and how much it will cost. Once you know what you’re aiming for, you can back into how much you’ll have to save for a down payment. About 20% is a relatively standard down payment, but many Millennials are opting for 10% down to get into a home sooner. This is totally fine as long as you have the cash flow to cover the mortgage with wiggle room. You don’t want to end up #housepoor.

8. How can I make a budget that still allows me to live the life I want? Are there any apps that I can use?

YNAB is a great app that helps you segregate your cash into different buckets so you can set money aside for your priorities first (rent, bills, student loan payments) and then blow the rest, guilt-free. At Stash, we call it reverse budgeting.

9. Should I have a financial planner? How do I find one that’s right for me and isn’t going to cost too much?

Financial planners serve many purposes, but their main job is to help you consider your short-, mid-, and long-term financial goals and then reverse engineer a game plan that puts you on track in the most cost-effective, tax-efficient way. Some people feel comfortable figuring this out on their own while others feel they might benefit from a guided conversation. A good financial planner can also serve as a mediator when you’re in a relationship and provide that unbiased outside opinion that’s sometimes the exact thing your spouse needs to hear from someone else. Some people feel they’ve done things right and use a financial planner simply for a second opinion from an experienced professional.

Finally, a financial planner knows that you may not know all the things you should be thinking about and makes suggestions to make sure there aren’t any holes in your plan. Stash Wealth is a virtual financial planning firm for H.E.N.R.Y.s™ (High Earners, Not Rich Yet) who are in their 20s and 30s and want to take their financial life to the next level. Stash Wealth is a fiduciary (no conflicts of interest) and charges a one-time flat fee to build you a customized game plan, called the Stash Plan®. Is the Stash Plan® right for me?

10. Do I have enough for an emergency fund? How much should I keep in that fund?

Unlike most financial professionals, Stash Wealth believes your emergency fund should be no more than three months’ worth of your fixed expenses (rent, bills, etc). Most personal financial gurus talk about six to 12 months, but we think that’s crazy for four reasons:

1. Your emergency fund is supposed to be your first line of defense, not your only line of defense.

2. Millennials are hustlers. If sh*t hits the fan, we’re at a time in our careers where we are able to reset our incomes pretty quickly (of course, you know your industry best)

3. We have so many other financial priorities. Waiting until we’ve saved up 6 months in cash, has us wasting precious time that could have been better used to help us achieve other financial goals.

4. That’s way too much money sitting in cash. As good as the online banks are (and that’s where we’d recommend you keep your Emergency Fund), your money is technically still losing value every year thanks to inflation. Millennials want their money to work harder for them. 

“If you think investing leads to a “quick win,” you’re thinking about it all wrong.”

-Priya Malani, Entrepreneur and Founding Partner at Stash Wealth

About the Author: Priya Malani is an entrepreneur and founding partner at Stash Wealth, a financial planning firm for H.E.N.R.Y.s™ (High Earners, Not Rich Yet). After years of working on Wall Street, Priya left to work with millennials, who are largely ignored by traditional financial firms. Stash’s clients are 20- and 30-somethings who make good money and want something to show for it. In addition to running Stash, Priya serves as the resident financial expert for Refinery29. She is a featured expert on numerous sites and speaks regularly at businesses and universities around the country. She appears regularly as a Millennial Money Expert on SiriusXM.

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This story was originally published on August 1, 2019, and has since been updated.

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How to Keep Calm About Money When You Start a Business

Photo: Christina Jones Photography

Funding your business is like re-enacting the first scenes of a Bond film. It’s fast-paced, dramatic, and highly unpredictable. But in the end, you know you’re at the beginning of the story, and M(s)r. Bond (that’s you) is very likely to prevail. S/he overcomes the first of the saga’s challenges by acting nimbly and exhausting even the most obscure options. You’ve got this. 

Here’s how to suit up, fight on, and tackle any financial challenge (whether it be personal or entrepreneurial) with that calm, cool, and collected charm that only Bond can balance. Because after all, aren’t we all aiming to fight financial obstacles with precision and grace in a beautiful British sports car? 

#1 Be prepared. Be very prepared. 

Ask any of your more tech-centric friends who their favorite Bond character is and they’ll likely say, “Q, of course.” That’s because Q prepares Bond for any high-speed chase or “sticky” situation. Here’s how to prepare yourself (and your wallet) to be financially ready to take the leap (or free-fall) into entrepreneurship. (Let’s be honest, these are all great for personal money management too). 

1. Build up your credit score if it’s less than 700. You’ll want a good score to open your business account, which can open up some credit lines when you’re strapped for cash. Believe us, this isn't a matter of if, it’s a matter of when.

2. Secure a little nest egg. While we know some bada$$ founders who had very little sitting in the bank, having an emergency fund to fall back on personally can seriously help with your stress levels. 

3. Know your next 3 steps. Before even publishing your website, know what you need to 1. Start your business, 2. Get your first client and/or 3. Build a community of loyal, paying customers. Stress reduction is all about knowing where you’re headed and how you’ll get there. Think of these as your GPS coordinates to locate that beautiful Aston Martin. You need them to slide into that leather seat and zoom through the road ahead. 

#2 List out your priorities (and everything else).

Lists are our best friends. BEST FRIENDS. We have lists for to do’s, to don’t’s, how to do’s, etc., etc. Listing out your priorities might be less of your on-camera Bond persona, and more like your very real, Money Penny (equal bada$$) reality. That’s ok. Your lists will help reassure you at the end of a very long day that you did some good, you defeated some evil, and you know what’s left to accomplish.

Here’s how to get your financial priorities set: 

1. Find the right team. As much as you may think your Bond alter-ego can go it alone, you can’t. He doesn’t. Why would you try? Determine what your weaknesses are early and hire someone better suited to manage that aspect of the business. Even better, find a co-founder. They invest, they’re likely to take as little-to-no income as you, and they work just as hard. (Plus, you then have someone to talk to about all the obstacles that arise). 

2. Negotiate everything. Set a projected cost for all of your assumed expenses. Then mark down where you think you can save 10, 20, 50%. If you’re working with contractors, remember they need your logo just as much as you need their work. 

3. Build SMART (specific, measurable, achievable, relevant, time-based) goals and milestones. List out your necessary milestones for the next year and then set reasonable goals to help you hit those targets. This will help you decide what you should spend money on now and where you can press pause if needed.

4. Always ask yourself, “What will investors think?” If you’re going to rely on outside investment to help you hit your goals, make sure you’re developing a financial plan that’s aligned with your market, your audience size, and your investment goal. Try and learn how investors think (which is different than business owners!) to craft your messaging and pitch. You can be debonair as all hell, but if your gadgets don’t help you defeat the bag guy, you’ll be left vulnerable. 

#3 Be kind to yourself. 

After a long, grueling defeat of the villain, what does Bond do? He takes a vacation. And as you’re building up your Bond-like entrepreneurial persona, you should try to too (have you decided on your code name yet?). Taking time away from your business no matter what stage it’s in is always going to be hard. There will always be emails to answer, ideas to craft, missions to crush. And yet, you will never be your full Bond-self if you don’t take the time to recover. 

Here’s how we prioritize kindness and self-care even after the most trying days: 

1. Find something to pay attention to after a long day, that isn’t a screen. Nature, anyone?

2. List your fears and come back to the list often to assess and reframe. At the end of the day, you’re not fighting some evil foreign power who wants the world to end. Try reframing each fear into an opportunity. For instance: “I’m afraid we’ll fail.” Turns into, “If we fail, I’ll only be disappointed if I haven’t given this f&cker my all. If I have, I’ll know I’ve done something great.” 

3. Ask for help. We never do this enough and often by the time we have it’s too late and we’re already drowning in stress. Don’t wait. Find your support network of entrepreneurs, advocates, advisors, colleagues who can help you navigate even the darkest or most uncertain situations. 

4. Build your Bond Backbone with a daily mantra. Here are some thought starters: “I am strong. I am capable. I am right for this. I am wise. I manifest my abundance.”

And there you have it. Taking that entrepreneurial leap can be scary, but when you have the right mindset, a good plan of action, and enough certainty that at the end of your story, you’ll be stronger, more resilient, and ready for anything, you’ll find a feeling of empowerment that far outweighs any obstacle or villain that might stand in your way. Now go out there, embrace your inner secret agent, and become the titan of industry you were born to be.  

“H

aving an emergency fund to fall back on personally can seriously help with your stress levels.”

—Maia Monell, Co-Founder and CMO, Nav.it

About the Author: Co-founder and CMO Maia Monell has experience in growth marketing and brand strategy for developing software firms as well as in global women’s development. Prior to Nav.it, Maia worked with sports technology brand Bridge Athletic and holds an M.S. in Marketing Strategy & Innovation from Cass Business School. Maia's background in developing programs for professional female athlete campaigns and Brand Ambassadors gives her the unique experience to develop Nav.it’s authentic voice and brand promise.

About Nav.it: Nav.it is a banking app that helps you build healthy financial habits.  Pay down debt, automate savings, track spending, and learn how to more optimistically navigate your financial future with Nav.it'sancial roadmap. Nav.it changes behaviors around money by providing personalized tools that build confidence in your money moves. Financial wellness starts here!

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This story was originally published on September 10, 2020, and has since been updated.

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This Founder Has Raised Over $4 Million in Venture Capital From the Backers of Warby Parker, Casper, Peloton, and More

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Nicole Gibbons

In 2018, Nicole Gibbons launched a brand like no other: direct-to-consumer paint company Clare. After navigating the outdated paint industry on behalf of her clients for years, the longtime designer made it her mission to disrupt the space. “Frankly, shopping for paint has always been a huge hassle,” Gibbons tells Create & Cultivate. “There are thousands of overwhelming colors, too many product lines, the store environments are completely uninspiring, and there’s a lack of design guidance throughout the process.” So she set out to take the guesswork out of decorating by founding DTC paint brand Clare, which carries a curated selection of 56 designer-approved swatches.

But it’s not just about reinventing the fan deck. “At Clare, developing paint formulas that are healthier for our customers and the environment has been a priority since day one,” the founder explains. Clare’s paints are zero VOC, meaning they’re free of toxic carbon-based solvents that pollute the air and pose health risks, and Greenguard Gold-certified, meeting rigorous emissions standards, which is significant when you consider air indoors can be up to ten times more polluted than the air outdoors, according to the EPA. “People care now more than ever about the products they consume and the impact those products have on their health, their home, and the environment,” notes Gibbons.

Ahead, the founder shares how she’s raised over $4 million in venture capital funding for her clean and conscious DTC paint brand (including funding from the backers of DTC darlings by the likes of Warby Parker, Casper, Peleton, and more) and offers her best fundraising advice for aspiring entrepreneurs who want to replicate her success.

Can you tell us a bit about your background and what you were doing professionally before launching Clare?

Prior to launching Clare, I was an interior designer, running my own design firm and also doing a lot of work in the media as a design expert, including appearing for three seasons on a DIY home makeover show on the Oprah Winfrey Network. Before that, I spent 10 years working as a PR executive for a large retailer while dabbling in interior design on the side. I’ve always been passionate about the home space and about helping people create beautiful spaces. 

What was the “lightbulb moment” for Clare? What inspired you to start your business and pursue this path?

Frankly, shopping for paint has always been a huge hassle. There are thousands of overwhelming colors, too many product lines, the store environments are completely uninspiring, and there’s a lack of design guidance throughout the process. After realizing that the paint shopping experience was broken and outdated and that no legacy paint brands were focused on delivering a seamless shopping experience for their customers, I had the lightbulb moment for Clare. We’ve reimagined an entirely new paint shopping experience that’s easier, faster, more inspiring, and more convenient. Our mission is to help people everywhere create a home they love and to become the go-to paint brand for a new generation of consumers who are passionate about their homes.

Clare’s paints are zero VOC and Greenguard Gold-certified. Can you tell us why was it important to you to create non-toxic paints?

At traditional paint brands, this is generally an afterthought, but at Clare, developing paint formulas that are healthier for our customers and the environment has been a priority since day one. People care now more than ever about the products they consume and the impact those products have on their health, their home, and the environment. The cost associated with achieving our Greenguard Gold certification for indoor air quality, which is a top tier, EPA-endorsed green certification, was not inexpensive for us as a small startup. However, we felt this was an important step to take in order to give our customers confidence in our products. 

You’ve raised over $4 million in funding for Clare to date, no doubt you’ve learned a lot along the way. What are three crucial elements everyone should include in a pitch deck when raising money and why?

First, tell a great brand story. Investors see hundreds of deals, if not more, so it’s important to present your brand in a way that grabs their attention and tells a compelling story. You want investors to immediately have a clear sense of your brand, your mission, what sets your company apart, and why they should get excited about both you as a founder and your company. 

Second, tell a great numbers story. Your business model, or how you’ll make money, should be clear, as should the basic unit economics of your business and your growth projections. And these numbers need to be super compelling. A favorite line from one of our biggest investors is: There’s nothing like bad numbers to f*ck up a great story! 

Lastly, do all of the above with conciseness, clarity, and a laser focus on the most important takeaways that you want the investors to remember. 

Your investors include First Round Capital (an investor in Warby Parker), Imaginary (Net-a-Porter founder Natalie Massenet's fund), and Bullish (a Casper, Peloton, and Harry's razors backer). What advice can you share for entrepreneurs on partnering with the right investors?

At the beginning of your journey, the power dynamics feel very much in favor of the investors. They have the money you need and, especially when you’re a first-time founder, you tend to believe they also have the secret sauce that’s going to help your business get to the next level, especially if they’re a bluechip fund with a lot of cachet. In reality, that is typically not the case. Most investors aren’t super hands-on, will never know as much about your business or category as you do, and often they don’t add a ton of value beyond the check. Founders often feel pressure to take whatever money you can get, but the investors YOU choose and the energy and influence they bring to the table can make or break your success. So the best advice I can offer is to be picky about the investors you choose and bet on yourself over betting on any individual investor being the key to your success.

Startups led by Black women receive less than 1% of venture capital funding. Why do you think there is still so much inequality in the venture capital world, and what advice can you share for BIPOC entrepreneurs who are currently seeking funding?

The venture capital world is incredibly homogenous. I’ve met a ton of venture capitalists and, overwhelmingly, they’re white men who are already rich and often born into privilege as well. So when it comes to deal sourcing, they’re focused on their own insular network of people who come from similar backgrounds which naturally leads to an extreme lack of diversity. 

VCs are also taught to “pattern match,” which is to look for patterns in founders that mirror previous founders who have been successful, but there’s an inherent bias in this approach when all of their founders come from similar backgrounds. Data proves that diverse teams lead to higher returns yet it’s still difficult for VCs to get out of their insular bubbles and actually invest in diverse founders and teams. In order to create more equality in terms of who gets funded, funds need to diversify their own teams, especially at the partner level since partners are who ultimately make the investment decisions. This will lead to a more diverse pool of deals to source from, and in turn, more BIPOC entrepreneurs seeing their ventures get funded. 

For entrepreneurs of color seeking funding, I’d say to first focus on funds that have a track record of funding diverse founders. This might mean funds that have a specific diversity focus, or simply who have a more balanced representation of founders in their portfolios. Next, don’t be intimidated by any data that shows the odds may be stacked against you. Instead, let your passion and confidence in what you’re building guide your process. Finally, be relentless and don’t get discouraged by the “no’s.” Raising venture capital is an incredibly difficult and draining process for any founder and even those who are very successful at raising capital face a lot of rejection. Trust that the right investors will be aligned with your vision.  

What was your first big expense as a business owner and how should small business owners prepare for that now?

My first big expense was building out our website. I was lucky enough to find a team who really believed in me and the business and agreed to help start the high-level conceptual and creative direction work for the site without pay before I raised capital. Once I closed our financing, I was able to pay them properly. We started working on that before I actually put any physical product into production.

Photo: Courtesy of Clare

What are your top three largest expenses every month?

We don’t replenish inventory monthly, but during the months we do, that by far is our biggest expense. Payroll and marketing are our next biggest expenses. 

Do you pay yourself, and if so, how did you know what to pay yourself? 

Most people assume that being a CEO of a highly publicized company means you’re rich or you have a hefty salary, but most startup founders, especially at the early stage are grossly underpaid because everyone is incentivized to put as much value as possible into the business. I’m lucky that because we had an influx of capital from venture investors I was able to pay myself a modest salary, but the salary I’m paid is around a 60-70% decrease from what I was making before Clare and a huge short-term sacrifice. I basically pay myself enough to cover my monthly expenses and not much more. The hope when you’re building a company is that the upside will be significant so any initial sacrifice or temporary discomfort are both necessary but also well worth it in the long run.

Would you recommend other small business owners pay themselves? 

Absolutely. To the extent that you can pay yourself a liveable salary, you should absolutely do so. Running a business is incredibly stressful, and it will be difficult to stay focused on the business if you’re also highly stressed about your personal finances and don’t have enough money to cover your basic necessities. The only exception is that if you’re lucky enough to have someone else taking care of you financially (i.e., family support, a spouse, etc.) then, depending on your situation, you might be better served not taking a salary and investing everything you have into growing your business. It all boils down to your goals, your plans for growth, and what you need to get you to your next milestone. 

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

With Clare, as a venture-backed company, the goal is to build a venture-scale business, so I knew there was no way I could do this on my own. I hired people as soon as I possibly could to help fill expertise gaps and also increase my bandwidth. When I started out, key hires included a digital marketer and head of supply chain since those were areas that needed a lot of attention and where I lacked the skills and expertise.  

What are some of the tools you use to stay on top of your business financials? What do you recommend for small business owners on a budget?

We have an outsourced CFO and an accounting firm who manage all of the day-to-day finances but keep a close eye on everything. In terms of tools, we use Quickbooks to manage our accounting. Google Sheets and Excel are tools of choice for building out reports to look at trends and gain deeper insights into how we’re doing. 

Where do you think is the most important area for a business owner to focus their financial energy and why?

This really depends on your goals. If your goals are growth then investing in marketing is probably going to be the most important area to focus on. If you have a highly technical product with a big innovation roadmap, you might invest in hiring engineers. If you have a capital-intensive supply chain, investing in building efficiency there might make the most sense. 

Do you think women should talk about money and business more? Why? 

Absolutely. Having collaborative discussions around business, finance, and sharing best practices with peers is often the best way to learn and grow.

Do you have a financial mentor? If so, how did you find one and do you think all business owners need one?

I’m lucky now that I do have people around me who I can go to for guidance, but I haven’t always. This is unfortunate because I feel like I could have prevented a lot of costly mistakes in both my business and personal finances if I had someone guiding me. I’ve had to figure a lot out of my own over the years, so if you have access to a mentor, lean on them to help you navigate all the things you don’t know. 

What is your best piece of financial advice for new entrepreneurs?

Ruthlessly prioritize what’s most important to your business and what’s in the best interest of your brand mission. When you’re running a young company, everything feels like a priority and so many opportunities come up that seem worthwhile, but when bandwidth is slim, you have to prioritize like a boss. Focus both your dollars and your human capital on the initiatives and opportunities that will propel your business forward and deliver the most value.

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79% of Women Are Feeling Weighed Down by Money and Stress—The Millennial Money Expert Is Here to Help

Photo: Courtesy of Tonya Rapley

One year into the COVID-19 crisis, women are more financially stressed than ever. 

Studies have shown that women typically suffer from more money stress than men, but the coronavirus pandemic has put even more of a strain on women. In fact, a recent survey by Fidelity Investments revealed 79% of women are feeling weighed down by money and stress, which is up from 67% last fall.

To talk about practical ways to take control of your finances, manage your money anxiety, and make smart money moves during these trying and stressful times, Jaclyn Johnson sat down with Tonya Rapley, a.k.a “The Millennial Money Expert” and founder of My Fab Finance, on this episode of WorkParty.

Tonya has completely changed the game, turning the once stuffy financial industry into a fun, familiar, and, dare I say, cool space. She’s been named the “New Face of Wealth Building” by Black Enterprise magazine, lauded as a modern “history maker,” and honored on Create & Cultivate’s CC100 List.

Scroll on to tune into the episode (and grab a pen because Tonya drops some serious knowledge!) and read on for just a few of the many, many mic-drop moments.

Subscribe to WorkParty and never miss an episode.

On setting your financial goals…

“Your financial goals should be based on what’s most important to you. Is it important to you to retire early and travel the world? Is it important for you to continue to work and build passive income and then retire? What’s most important to you?”

On assessing your unique financial situation…

“A lot of people want to do things the ‘right’ way because they’re afraid of doing things the wrong way, but right looks so different for so many people.”

On managing COVID-induced money anxiety...

“First, we have to question where that anxiety comes from and if it’s own or if it’s external or environmentally induced anxiety when it comes to our finances.”

“A lot of times it’s helpful to just go sit and look at the numbers. Sit down and look at your bank account, look at your expenses. Really face the numbers.”

On leaning on your support system…

“If you are dealing with things like a loss of income, then really lean on your support network. Be honest and transparent and ask for what you need.”

“Ask for what you need and don’t be ashamed to do it because everyone has seasons when they need support and help.”

“No one is going to judge you for what you’re going through. It’s a collective experience.”

On investing your money as a beginner…

“Start small. Use that money to learn. Don’t put it all in one place at one time and don’t go out and buy what is trending, such as Game Stop.”

“Don’t be afraid to hire someone else to do it. If you don’t feel comfortable doing it on your own or if you don’t have the space to learn.”

On her top three money tips for WorkParty listeners…

“Make sure that you’re saving. You always want to make sure you’re saving so you can be your own emergency fund.”

“Don’t overcomplicate your finances. Start with what’s simple and try to keep things simple for as long as possible.”

“If you don’t know how to do it, find someone who does.”

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The Fashion Industry Accounts for 4% of the Globe’s Greenhouse Gas Emissions—So These Founders Are Doing Things Differently

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Londre Bodywear

It’s no secret that fashion has a sustainability problem. But while the industry currently accounts for 4% of all global greenhouse gas emissions, consumers are advocating for change and spending their dollars accordingly, investing in brands that are committed to reducing their impact on the environment. Londre is the latest sustainable fashion brand to catch our attention at Create & Cultivate, and we’re not the only ones. The Canadian fashion brand recently received a $208K investment on “Dragons’ Den” (a.k.a the “Shark Tank” of Canada) and we’re eager to share the story behind the brand before you see it all over your Instagram feed (because trust us, you will).

Based in Vancouver, Ainsley Rose and Hannah Todd launched Londre in reaction to the startling amount of plastic pollution in the world's oceans. To date, the brand has recycled 100,000 plastic bottles off of the streets and beaches of Taiwan into their sustainable swimwear offering. But sustainability isn’t just about the planet for Rose and Todd, it’s also about the people. “Our products represent 360-degree sustainability, and this is something we heavily invest in,” Rose tells Create & Cultivate. “We believe that you can’t take care of the planet without taking care of its people, so ensuring our internal and external teams are treated fairly is critical,” Todd adds.

Here, the co-founders share how they bootstrapped the brand with an initial investment of just $15,000 and turned it into a business that generates seven-figure revenue.

Talk us through your bootstrapping process. How did you self-fund Londre, and would you recommend that route to other entrepreneurs today? 

AINSLEY ROSE: We took an initial $15,000 CAD investment from a close friend to help with our first round of samples. Since then, we’ve completely bootstrapped our business and have been self-sustaining. As a sustainable mission-driven brand our finances have to be looked at strategically to ensure that we can make choices that enact positive change and benefit both the planet and our business. 

HANNAH TODD: Since inception, Londre has seen a 300% year-over-year growth, and a big reason why is that we’ve been scrappy. This has helped us develop clarity in our business because sometimes having too much cash allows you to put a bandaid on a problem instead of fixing the issue from the start. This has also allowed us to grow organically, putting community first and ensuring market need. Not being beholden to a VC or large stake investor also has allowed us to work without an additional layer of pressure, and better tune into our intuition about what is best for our business. 

Can you share three crucial elements everyone should include in a pitch deck when raising money?

HT: Because we were pitching to someone we have a strong personal relationship with, our pitch was super simple. We didn’t even have a sample made yet. Ultimately, they chose to invest in us because they had faith in the values and ethics we hold as people, and less so in the product offering itself. Being empathetic, speaking from the heart, and having a good understanding of market trends helped us in our pitch. 

AR: The person who invested in us originally is still a trusted advisor and has been able to provide incredibly helpful insights over the years. 

What are some of the most common mistakes people make when raising money?

AR: I think the most common thing we see is valuing skills over the relationship. In choosing an investor, or business partner for that matter, ensuring that you feel comfortable communicating honestly and have a strong foundation of trust is key. 

HT: We also see people asking for too much too soon. If you are creative enough, you can likely get by with less than you think, and having too many controlling voices involved can complicate things.  

How much do you pay yourselves, and how did you know what to pay yourselves?

AR: Londre started out as a side hustle for Hannah and me that eventually became our main gig and source of income. I was working as a photographer, which allowed me to set my own schedule and develop a great network. I eventually stopped taking on new clients once Londre had reached a point where I felt comfortable taking a meaningful salary.

HT: I was working as a yoga instructor so also was able to make my own schedule. We chose how much to pay ourselves based on our lifestyle. To decide on our salaries we budgeted how much we needed each to live comfortable, satisfying, and sustainable lives in Vancouver and worked backward from there! We also allocated a bonus structure to celebrate when sales goals are hit. 

How did you decide what to pay employees? 

HT: Currently, we work with a team of contractors who are all small business owners in their own right. We find that this gives both parties more flexibility and freedom. We collaboratively decide on compensation and offer performance-based incentives. We believe that you can’t take care of the planet without taking care of its people, so ensuring our internal and external teams are treated fairly is critical. 

AR: We look to third-party certifications like Oeko Tex 100 for our fabric and work with Vancouver-based companies with an A+ Better Business rating to ensure that our ethical and sustainable mandate is met. Although working this way is more expensive than using a more traditional fashion model, ensuring value alignment in our brand has made our business thrive, generating seven-figure revenue and feels deeply rewarding. 

Where do you think is the most important area for a business owner to focus their financial energy?

AR: Our products represent 360-degree sustainability, and this is something we heavily invest in. We notice more brands are using more recycled materials and it’s something we love to see! However, if sustainability isn’t looked at from a holistic lens, it may easily be greenwashing. 

HT: For example, even if a product is made from recycled materials but isn’t functional and high quality, packaged using sustainable materials, and without a plan for the end of its life cycle, it ultimately will end up in a landfill contributing to further waste. We’ve focussed most of our financial energy on product development and quality control. Ensuring that our products are high quality and long-lasting is our first concern, not only from a customer satisfaction standpoint but also from a sustainability perspective. We just launched our first loungewear collection, The Essentials, and a lot of research went into finding fabrics and components that stay true to our 360-degree approach. 

What was your first big expense as a business owner?

HT: Our first round of samples. What we thought was going to be a $5000, two-month project turned into a $16,000 venture, nine months later. The first suit we created, the Minimalist in Matte Black, is still our biggest seller, so ultimately the hundreds of revisions were worth it. 

What are your top three largest expenses every month?

AR: Production costs (ethical manufacturing and sustainable materials); shipping and compostable and recyclable packaging; and digital ads (we actually only started running them in the last year). 

How much do you spend on office space?

HT: $0. We are fully remote.

How much do you spend on employee salaries?

AR: Contractors and our salaries: ~$25,000 a month 

How much are you saving, and when did you start being able to save some of your income?

HT: We as co-founders save about $1,000 a month each. We’ve only started paying ourselves enough to save within the past year. 

Did you hire an accountant? Who helped you with the financial decisions and setup of the business?

AR: Yes! We have an accountant who supports our year-end and we use QuickBooks for day-to-day accounting. 

HT: Ainsley’s fiance is a CPA and he’s stepped in to help us with inventory forecasting and budgeting when we need support with more complex financial modeling

What are some of the tools you use to stay on top of your business financials? 

AR: We use QuickBooks for our accounting. We also have a detailed model which helps us plan our inventory, forecasting, and budgeting. Additionally, we have a recurring calendar event monthly to go over inventory and budgeting. 

What do you wish you’d done anything differently in your financial journey as business owners?

HT: We overspent on in-person events. The most successful event we held was actually the least expensive, as connection trumps extravagant details every time. 

Do you think women should talk about money and business more?  

AR: Absolutely! There is so much stigma around gaining wealth, particularly for women. We’ve both taken courses by Lacy Phillips to break down any blocks and baggage we may hold around money and learn how to move into abundance. 

HT: We feel privileged to have a community of entrepreneurial womxn who we can talk candidly about finances and this has helped us immeasurably. 

Do you have a financial mentor, and do you think all business owners need one? 

HT: Our investor, who still has a small stake in Londre Bodywear, is our financial mentor. This relationship works for us because we can communicate openly with them and have been able to lean on their entrepreneurial experience. We check in every two months so we can ask general questions. 

AR: We don’t think you necessarily need a mentor because your intuition is best, but having a mentor who you can trust to gather advice from and see if it fits has been helpful for us. 

What is your best piece of financial advice for new entrepreneurs?

HT: Get super clear on your values. There are tons of shiny things to be distracted by but when you have a foundation of nonnegotiable sustainability (or whatever your chief value is) it allows for further clarity. 

AR: Also, don’t be afraid to negotiate and see what transactions you can do as trade instead of monetarily. Get creative with your trades! We asked for tons of help and in exchange would not only offer store credit, but also services that lined up with our skills. For example, Hannah was a yoga instructor and would offer a private yoga session in exchange for someone helping us build a financial model.  

What have been some of the hardest money lessons you've learned along the way? 

AR: We originally wanted to start our business in Bali. Our fabric and samples were stolen, and I was left waiting at the airport at 1 A.M. for the sample maker, who never showed up, and had nothing to show for a two-week-long trip. We ended up restarting in Vancouver (where we live), and now are able to have eyes on production. Keeping things close to home so you can directly oversee everything gives you more control over how your money is used.

HT: Wait until you have clear market approvable before creating a huge run of your product. We’ve always valued organic growth and doing small runs and which has contributed to increased demand and zero wasted product.  

What is your #1 money tip for small business owners?

HT: Be scrappy, don’t be afraid to ask hard questions, and negotiate in a kind and empathetic way. 

AR: Keep your values at the forefront of all of your financial decisions.

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When She Was 12, She Started a Cookie Company—Now She’s the Founder of Two Major Organic Food & Bev Businesses

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Nicole Bernard Dawes

It’s safe to say Nicole Bernard Dawes knows a thing or two about the food industry. Raised among the aisles of her mother's natural food store in Chatham, Massachusetts, and on the factory floor of her father’s company, Cape Cod Potato Chips, she was surrounded by CPGs and P&Ls from a young age. And it didn’t take long for her parents’ passion for food and entrepreneurial drive to make an impression on her. When she was twelve, she started a cookie company with her best friend, and although the business was short-lived, lasting just one summer, her appetite for entrepreneurship was not.

In 2003, after a search for organic crackers left Dawes empty-handed, she teamed up with her father to launch Late July, a snack food company to fill the gap in the market for delicious, organic options. Known for its range of delectable crackers, popcorns, and tortilla chips, the brand has quickly grown into a multi-million dollar business with stockists ranging from CVS and Bevmo to Whole Foods. Now, Dawes is applying her business acumen and skill for bringing superior-tasting organic options to market to the beverage industry with Nixie, a certified organic, non-GMO sparkling water brand.

Ahead, the serial entrepreneur tells Create & Cultivate all about how she’s built two successful food and beverage companies, what really it takes to see a business through tough times, and why every entrepreneur should prioritize investing in their team.

How did you make your first dollar and what did that job teach you that still applies today?

When I was twelve my best friend and I started a cookie company. By some miracle, we actually convinced two delis in our small town to sell our homemade chocolate chip cookies all summer long. Twice a week from June to September, we baked our cookies, wrapped them individually, labeled them, and walked to each location dropping them off. We had a blast! In addition to the importance of pricing your product correctly and crafting a good sales pitch, I experienced the joy that comes from loving your job.

Take us back to the beginning—what was the lightbulb moment for Nixie and what inspired you to pursue this path?

With Late July, I was pregnant with my oldest son and couldn’t find an organic saltine anywhere in New York City. I realized that I had discovered an opening into the multi-billion dollar snack market. For Nixie, similarly, I desperately wanted a delicious, refreshing, and certified organic sparkling water to satisfy my family’s significant daily sparkling water habit. I was shocked that none existed that checked all those boxes.

One of the things that drives me the most with both Late July and Nixie, is proving that certified organic products can sell as well as their conventional counterparts. I also love being a business owner because we’re able to make an impact in areas that are important to me personally and also for our planet—for example, I have a goal of helping to eliminate single-use plastic beverage containers and Nixie is committed to never using them.

Entrepreneurship is all about taking calculated risks. What’s the most pivotal financial risk you’ve taken, and how did it change your path? 

Deciding to launch Late July’s tortilla chips during the recession of 2009, the same year my father died and our bank used his death to put our multimillion-dollar loan in default, was the biggest risk I’ve taken as an entrepreneur. We essentially pivoted our whole company with a very expensive product launch during the most uncertain time in our company’s history. Those tortilla chips went on to become the number one tortilla chip in natural foods, and changed the whole trajectory for Late July, making us an overnight success, seven years in the making. When we made this pivot our sales were at $8M, afterwards, we quickly grew to $100M.

Where do you think is the most important area for a business owner to focus their financial energy and why?

Definitely their team. Hiring the right people is expensive and time-consuming, but your team is everything.

What was your first big expense as a business owner and how should small business owners prepare for that now? 

For both Late July and Nixie our first big expense was our initial production run which is very often the case for consumer product companies. Most factories have pretty significant minimum order quantities, which in addition to the cost of producing the finished goods, also means significant upfront costs for raw materials, packaging, and corrugated all before you have any customers. You have to spend the money without any guarantee that you’ll ever make it back. First production runs are expensive and terrifying for a million reasons, but also exciting.

What are your top three largest expenses every month?

Outside of the cost of goods, freight, and promotional expenses, our three biggest monthly spends are on payroll, trade marketing, and sales support (brokers, merchandisers, etc.).

In the beginning, how much did you pay yourself and how did you know what to pay yourself? 

I didn’t take a salary for a long time at Late July and when I did it was $60,000 per year. It wasn’t until a board member in my eighth year suggested it was time to stop underpaying myself based on the company’s success that I finally increased it to a market rate. For that, I used comps for my industry as compiled by our payroll provider. I’m not currently taking a salary at Nixie.

Photo: Courtesy of Nixie

Would you recommend other small business owners pay themselves? 

It really depends on the source of your funding and the amount of your ownership. If you are the primary source of funds and own a significant majority of stock, then it doesn’t really make sense to pay yourself until the company is ready. If you are giving up ownership to bring in investors, then you should absolutely budget for your own salary at a market rate.

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

I hired a part-time accounting person almost right away at Late July and budgeted for a full team for Nixie. So much depends on your funding and how fast you intend to grow. One piece of advice I’d suggest—especially if this is your first venture—is to be hyper-aware of what areas are your strengths and which are your weaknesses so you know what roles to hire first and what qualities to look for in any given role.

Did you hire an accountant? Who helped you with the financial decisions and setup? 

I did have an accountant from the beginning of both companies. He helped me choose the right type of company formation (i.e., LLC vs corporation). For Nixie, we also used an outside accounting person to help our VP of finance with day-to-day accounting in lieu of bringing that function in-house.

What apps or software are you using for finances? 

I highly recommend the following financial and software programs that we use at Nixie: Xero for accounting, Bill.com for bill pay, Gusto for HR, Unleashed for purchase orders, Crisp for sales forecasting, and Expensify for expense reports. We also use Office 365 and Microsoft Teams. I love our current software setup. It’s not expensive and allows for easy reporting from anywhere.

Do you think women should talk about money and business more? Why? 

Absolutely! If you stop for a minute and realize that until the Equal Credit Opportunity Act passed in 1974, married women were denied credit cards and loans in their own name. It wasn’t much easier for single women. It takes generations of change to normalize new behavior, and encouraging open communication on the topic of money and business among women is a vital part of that. I have a network of fellow women CEOs who I frequently and openly talk to about issues affecting our businesses. I also love when business magazines, podcasts, and websites utilize women CEOs to answer everyday business questions.

Do you have a financial mentor? Do you think business owners need one? 

Not specifically, but I was raised in a family business and grew up around P&Ls, income statements, and balance sheets. When I started that cookie company at twelve, my father taught me how to calculate our cost of goods and properly price our products. I don’t think having a specific financial mentor was essential for me because of my background and the fact that I was an economics major so I had a high degree of comfort and familiarity with finance, but if finance and accounting are outside of your comfort zone, then yes.

What is your best piece of financial advice for new entrepreneurs?

Deeply understand your cost of goods, P&L, and balance sheet. Never let anyone else tell you the financial state of your company. If there’s something you don’t understand, learn it.

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How This Stylist Turned Designer Launched a Business During COVID—and Attracted A.O.C and J.Lo’s Attention in the Process

You asked for more content around business finances, so we’re delivering. Welcome to Money Matters where we give you an inside look at the pocketbooks of CEOs and entrepreneurs. In this series, you’ll learn what successful women in business spend on office spaces and employee salaries, how they knew it was time to hire someone to manage their finances, and their best advice for talking about money.

Photo: Courtesy of Karen Perez

Karen Perez never saw herself designing masks. But when the fashion stylist of 15 years was tasked with finding chic, high-end face coverings for her clients during the pandemic and couldn’t find any, she decided to make her own. “I wanted to create a mask that was feminine and chic by highlighting our cheekbones,” Perez tells Create & Cultivate. “A mask that empowered us to still look and feel amazing when we needed to go outdoors.” And the demand for her products has been staggering from the start.

Leading up to the launch of her business, Second Wind, she announced a pre-sale on Instagram, anticipating 100 orders—not 10,000. The overnight success was overwhelming but also posed a major problem: finding the funds to fulfill thousands of orders. “Right after our launch, I decided to create a GoFundMe to raise capital,” Perez explains. “Within a matter of a week, I raised more than $4,000 which made me realize how many people wanted to support my business, my dream.” Including A.O.C. and J.Lo who are just a few of the high-profile women who’ve been spotted wearing her designs.

Ahead, Perez shares her best advice for scaling a business quickly and sustainably, raising capital through crowdfunding, and building a dedicated team.

What has been the biggest challenge in scaling so rapidly, and what advice can you share for fellow small business owners on how to scale quickly and sustainably?

The biggest challenge was finding the right manufacturers in the U.S. so that I can oversee the work. My advice for those thinking of launching a business or fellow small business owners is to always have a targeted budget to work with and set up contracts with your vendors. 

Would you recommend raising capital through crowdfunding to other entrepreneurs today?

The GoFundMe was very helpful and I recommend others to look into this or other crowdfunding platforms. I know some of us are scared to ask for money, let alone apply for loans, but you’d be surprised how many people out there want to see small businesses thrive. 

Photo: Courtesy of Karen Perez

What was your first big expense as a business owner and how should small business owners prepare for that now?

My first biggest expense was supply—and still is. For big expenses, you have to save. It’s hard for me to give this advice because I gave every penny of my savings to launch the business. I don’t advise everyone to do that because I have a different story than others. While it might not be the best advice, if you feel like you have something special and you want to do it right, go all in.

What are your top three largest expenses every month?

1. Product, materials 

2. PR/marketing 

3. Payroll 

Do you pay yourself, and if so, how did you know what to pay yourself?

Technically I don’t pay myself (yet) because every dollar that I make, I put it back into the business. Second Wind still hasn’t even met its first year, and I have to recognize that I still have more expenses to make in order for this business to grow before I can see personal revenue. 

Would you recommend other small business owners pay themselves?

Absolutely! I think it’s important that you pay for the necessities that you need. You really need to learn how to manage your budgets and how to manage your business and personal expenses. Always stay realistic with yourself. 

How did you know you were ready to hire and what advice can you share on preparing for this stage of your business? 

I knew I had to hire right away—as soon as I saw the 10,000 orders! I physically can’t do all of this by myself. I realized I had to take into consideration what I am investing in when hiring staff. When hiring your team, don’t just look at someone who’s going to make your job easier. You need to invest in building a team that is going to be dedicated to building the business with you. 

Did you hire an accountant? Who helped you with the financial decisions and setup? Are there any tools or programs you recommend for bookkeeping?

I hired an accountant and bookkeeper that I work with on a monthly basis. My accountant is also like my financial advisor and has guided me with managing budgets and expenses. My go-to program is Quickbooks. 

Where do you think is the most important area for a business owner to focus their financial energy?

Your financial energy should definitely be put towards your product (materials, supply) and PR/marketing. This is the core of my business and it’s what helps us to continue to grow. 

"No matter how much money you are making, how much money you have to spend, if you stand by your product and business you will see financial gain."

—Karen Perez, Founder of Second Wind

Do you think women should talk about money and business more?

Yes! I think it’s so important. For a long time, women were never thought to be included in these conversations. I think it’s important for us to come together and be open and share advice. I have my go-to circle of friends that are also small business owners and they share advice with me all the time. 

Do you have a financial mentor? Do you think business owners need one?

I have several financial mentors—a mix of both men and women. I think it’s important for others to have one. Don’t be shy to network and ask around/meet with your local business owners. You’d be surprised as to how many small business owners in your area would be willing to chat with you and give you some advice. 

What money mistakes have you made and learned from along the way?

As a new small business owner, you are eager to get things done and sign off on contracts without reading them properly, and when there are problems, you realize you didn’t read the contract correctly. My advice is to READ everything carefully and protect yourself. 

What is your best piece of financial advice for new entrepreneurs?

The best advice is to love what you do. No matter how much money you are making, how much money you have to spend, if you stand by your product and business you will see financial gain.   

Your business has garnered the support of high-profile women by the likes of Alexandria Ocasio-Cortez and Jennifer Lopez. No doubt, major retailers are asking to carry your products as a result. What’s next for you and your brand? Can we expect to see Second Wind products at Bloomingdale’s or Nordstrom in the future? 

We are excited to announce that we have a confirmed retailer commitment from Saks Fifth Avenue. Our products will be sold online until further notice. This is just the first step to growing into a global brand.

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Pro Tip: How to Approach a Client About a Late Payment

Photo: ColorJoy Stock by Christina Jones Photography

We’ve all more than likely been through this particular situation but I’m curious: how many of you reading this are happy with the way it was handled? In my experience, people are typically afraid to approach a client about late payments because they’re afraid of annoying or upsetting the client.

Your clients do not hold all of the power.

They should be just as concerned with annoying or upsetting you by being late with their payments. And more likely than not, these situations can be easily solved with some good ole fashioned communication. So let’s break down how to approach and communicate with your clients about a late payment.

Why it’s important

You need to get paid, that’s why.

Scenario #1

You’ve been working with a new client and after the first month of service, submitted your invoice. Another month of work has gone by and you’re about to submit your second invoice but haven’t been paid for the first invoice you submitted. You originally agreed to payment schedule terms with your client at the start of your working relationship and put a “net 30” payment deadline in your scope of work and invoice.

If the terms have been agreed upon and this is the first time you and your client are working together, it may take time to get the first payment process into rotation with Human Resources (HR) and Accounts Payable (AP).

While this isn’t ideal for any situation, it’s one of the many hurdles of freelance life and it’s better to prepare for it than not; but that doesn’t mean you shouldn’t say anything when a payment is late either.

Say this

“I’m getting ready to submit my second invoice and wanted to let you know I still haven’t received payment for last month’s services. Do you have everything you need from me to get this processed? If so, can you please let me know when payment is expected to come through?”

Don’t say

“….”

The breakdown

When it comes to talking to your client about getting paid, more people opt for saying nothing over something. It’s imperative you keep an open dialogue about payment processing so you can better manage your personal finances.

Freelancers don’t have the luxury of bi-monthly paychecks and your clients will understand this. Remember, your services are an investment and they should respect your time and business by actively communicating when payment may be late.

If you approach your client about a late payment and they’re able to share why it’s running late and when it will be processed, that’s a great first step. Take note and document it in a follow-up email with the information that was shared if the conversation is held in person or over the phone.

From there, hold your clients accountable. If the date comes that they said you’d receive payment and it doesn’t process, follow up with another email. Chances are, there’s another department that handles payments and your client will do their due diligence to make sure you get paid.

Scenario #2

You’ve submitted not one, but two invoices that have not been processed. You’ve approached your client about the first late payment and they gave you a timeline for when it would be processed. Now you have two late invoices and it’s time to submit invoice number three.

Say this

“I’m getting ready to submit my third invoice and have still yet to receive payment for my first or second invoices. The terms we agreed upon have not been met and I’ve followed up several times to try and resolve this matter together. With respect, I will have to cease my services if these late invoices aren’t processed by one week from today. I hope you can understand the difficult circumstance this puts me in and that we can work together to reach a solution.”

I have a feeling this is going to cause some mouths to drop.

What? Cease services?

YES. You need to get paid!

Freelancers, hear me! This is business 101.

Clients and freelancers create a circle. You should be getting just as much value from the relationship as your client is getting from you. This isn’t just measured in dollars. This is measured in reliability and respect. If you have continually met your deliverables and communicated your expectations for payments and they’re not being met, then it’s time to take a stand.

It will be difficult but it is necessary. And it will light the fire under your client’s butt because if you’re doing your job right, having you around makes their work-life easier and they should want to keep you happy and ultimately, paid.

What financial situations have you found yourself in that you wish you had communicated better? Share them in the comments or send me an email at hello@thescopeblog.com.

“Clients and freelancers create a circle. You should be getting just as much value from the relationship as your client is getting from you.”

—Audrey Adair, Founder of The Scope

About the author: Audrey Adair is a seasoned freelance communications professional and founder of The Scope, a platform providing resources and community to freelancers and the self-employed. Connect with The Scope on Instagram and join their email list to receive your free resource, The Freelancer Starter Kit.

This post was originally published on April 30, 2019, and has since been updated.

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I Got 20 Female Entrepreneurs Together and *This* Is Their Biggest Problem

Photo: ColorJoy Stock by Christina Jones Photography

At an entrepreneurial meetup I hosted recently, I asked everyone to think of a high-end offer for their audience. Most of the women in the room had never offered anything at a premium price, but I was shocked when someone started telling the group about her experience doing so. “I run a successful, high-end seven-figure company, and have for over a decade, but every time I finish the year, I’m disappointed with profit margins hardly over 30%,” one entrepreneur told us. 

She went on to explain that she charged a lot, but would also sometimes tell her clients that they didn’t need to pay for that month’s work or she would offer to do certain expensive tasks for free. Woah. High-end, but still scraping by? Not okay. But she’s not the only one. According to this study, self-employed men earn 28% more than self-employed women. Why is this? In my experience, it’s usually because women don’t charge enough for their services or they try to be too generous, which then leaves them with measly profit margins.

By and large, the #1 problem female entrepreneurs have is asking for an amount that not only covers costs but also leaves them with a healthy 70% profit margin. Here are three things you can do to reverse this and make more money in business.

1. Fire some clients. 

If you have a client who doesn't want to pay what you're worth, don't hold on to them. Lovingly let them go. This will create space for more clients to come in that will gladly pay whatever rate you charge. And the secret truth is that the highest-paying clients are the easiest to work with, but you can’t serve them if you’re too busy with clients who don’t value you or your work. Trust that there’s more where that came from, set your boundaries, let difficult clients go, and focus on attracting higher-end clients that love you.

2. Overcompensate for costs. 

If you think you need to charge $5,000 to cover costs and turn a profit, my advice is to double that. When you price an offering, putting in a buffer amount allows wiggle room for you to cover any extra time or expenses spent on a project. It’ll also ensure that if you need to hire help or invest in new material you won’t go in the red. This is especially important for product-based or project-based businesses that go off of cost estimates. Overestimate costs so that you can a) make more money and b) overdeliver on your service. 

3. Charge a premium price. 

To me, premium means anything above $1,000 a month. If you're charging a premium, you can take on fewer clients, do better work with them, but not suffer the loss of profit. You can have multiple tiers of offers to serve your client base, but having at least one premium offer is such a game-changer when it comes to scaling your business. Raise your rates and watch the magic happen as you work less and earn more. 

I don’t know about you, but I’m done seeing women settling for “enough.” Setting the bar high for yourself and your business means you aren’t just a newbie in your field, you’re an expert. What naturally follows is increased profits and better clients. 

“If you have a client who doesn't want to pay what you're worth, don't hold on to them.”

—Kimberly Lucht, Business Coach

About the author: Kimberly Lucht is a business coach who helps women make their first six figures doing what they love. She’s been featured in Money, Business Insider, Well + Good, Greatist, Create & Cultivate, and more.

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5 Things You Need to Know Before Raising Money for Your Startup

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Asking for money is rarely fun. But it’s especially tough—and often futile—for women. Why? We’re less likely to get a raise at work, even though we ask at the same rate as men. And we’re especially unlikely to get money for our startups since only 2.2% of all venture capital goes to female founders. (The percentages are even worse for women of color.)

Even for those women who successfully ask this question, it’s as I write in my book Startup Money Made Easy: The Inc. Guide to Every Financial Question About Starting, Running, and Growing Your Business, “seeking outside money is a daunting, grinding, tedious process.” It can go horribly wrong. But raising money can also go tremendously well if you do your homework, network like crazy, and get lucky.

Over the course of nearly five years of reporting and editing money coverage at Inc., I’ve interviewed many successful women founders. Some of them avoided raising outside money entirely; others have raised tens of millions of dollars. So if you’re ready to take the VC plunge—or to start off by asking friends and family to back your business.

Here are five things to know about raising money for your startup.

You don’t necessarily need to do it.

VC-backed startups like Uber, WeWork, and Airbnb get a lot of the headlines, but most startups never ask outside investors for money and many thrive regardless. Take S’well: Founder and CEO Sarah Kauss turned her high-design water bottles into a $100 million business without ever taking outside investment.

There’s an increasing number of women funding women.

While traditional VC has a long way to go to close the gender gap, there is a growing number of investment firms focused on women-led startups. Some examples are Arlan Hamilton’s Backstage Capital, Susan Lyne’s BBG Ventures, and Anu Duggal’s Female Founders Fund. Women founders, meanwhile, told Inc. that female investors often better understand their target markets.

Still, it’s often a slog.

“When you see company after company raising money, you get the outside-in perception: ‘It's not that difficult if they can do it.‘ But this is not the case,” Policygenius co-founder and CEO Jennifer Fitzgerald told me about her initial fundraising expectations. “It was a very fruitless and frustrating few months,” she adds. Fitzgerald and her co-founder eventually raised their seed round through small checks from about 50 friends and family members, “which is a painful way to do it, but we had to get it done,” she recalled.

It can also be exhilarating.

“Raising money was a year and a half of my life, and I loved every minute of it. Boy, was it grinding and difficult,” Christina Tosi, the pastry chef who’s now the founder and CEO of Milk Bar, told me last year. “You're going to war … and not necessarily in a negative way. It doesn't have to be argumentative.”

It matters who your partners are.

Don’t accept just any investment. As your business grows, you’ll want to make sure you and your investors can agree on what’s best for the business (unless you want to try to buy them out). As Tosi put it, “You can't do a good deal with bad people, and you can't do a bad deal with good people.”

About the author: Maria Aspan is an award-winning business journalist and an editor-at-large at Inc. Magazine, where she oversees money coverage and writes about startups, technology, finance, and gender. She has also covered business and finance for The New York Times, Thomson Reuters, and American Banker. At the latter, she served as national editor and covered the 2008 financial crisis and its aftermath.

This post was originally published on March 11, 2019, and has since been updated.

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3 Money-Saving Tax Tips for Small Businesses

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If you were to ask anyone who just launched a business, start-up, or product in January of 2020 where they’d be in a year, I’m sure most would have had an optimistic answer and replied with an answer along the lines of “hoping my business will take off.” Unfortunately, that was in a time before COVID. Now, an estimated 60% of small businesses have closed in the past year, and the impact the pandemic has had on small businesses is absolutely heartbreaking. I myself launched a small business right before the pandemic hit and completely understand the challenges that most founders face. I am one of the fortunate ones who has been able to maintain my business through an online presence and very dedicated clients. 

Most of my clients are also small business owners who faced the same challenges as me in 2020, and as a tax strategist and owner of Your Tax Coach, it’s my goal to help them navigate PPP loans, EIDL grants and loans, the COVID relief bill, a change of presidential administration, and now, tax season. You’re probably wondering “what is a tax strategist” and “what exactly makes you any different from an accountant?” Simple, my goal is to save business owners like you tens of thousands of dollars on your tax returns, while also relieving your tax-related stress and anxiety through consistent, easy-to-understand communication. 

An accountant will keep records of your finances throughout the year and keep your tax returns compliant. They don’t look for different strategies to apply when filing your taxes and their goal isn’t to save you money, especially if you are a small business owner. For example, did you know that you can claim your cell phone bill, internet, business coaches, courses, conferences, books, magazines, coworking spaces, website design, and even those holiday cards you sent to clients on your tax returns? Some tax strategies also include paying your children and paying yourself rent through your business. Accountants aren’t going to include claims like these because it takes time and documentation to implement. 

Now, this is how I saved my clients over $4.5 million in 2020 on their tax returns, and what I recommend you should do. Here are my top three tips for all small business owners filing their taxes this year.

1. If you profit over $40,000 a year in your business, you should probably be an S Corporation, not a sole proprietorship or LLC. 

It’s easy to assume just because you are a one-woman show running a small business that you don’t necessarily qualify to be considered an S corporation. Although S Corporations require an application and documentation, this is an easy way to save up to $22,000 in taxes each year.

2. Know your numbers, and update your bookkeeping monthly.

Track, track, track! Staying on top of your bookkeeping each month (or, better yet, each week) makes it so much easier to know how much you are profiting. Waiting for your accountant to figure it out a few weeks before taxes are due will not only be a pain but will also likely result in you overpaying in taxes. 

3. Have a tax strategy session with a tax strategist (you’ll be surprised to know that you’ve been overpaying for years). 

Again, a tax strategist is entirely different from your accountant, and meeting with me or another tax strategist, you’ll quickly realize you’ve been overpaying taxes for years. 

Bonus tip: Have a home office? Make sure you’re getting the maximum home office deduction. (There are multiple ways of calculating it.) 

Most small business owners and entrepreneurs don’t have a traditional office space that they’re renting. We all know that you're really working in some small makeshift office, which, technically speaking, is still considered a home office. If there is a desk, computer, and chair present, you got yourself an office. Make sure you know to deduct this when you are filing your taxes. 

Overall, a tax strategist is going to go above and beyond to save you as much as possible in taxes. My biggest recommendation is to invest in yourself and your business and hire someone who is going to ensure that filing your taxes is a fun and easy process, instead of dreading it. Your tax strategy should be seen as a MUST, not a plus. 

"Invest in yourself and your business and hire someone who is going to ensure that filing your taxes is a fun and easy process, instead of dreading it."

—Barbara Schreihan, Founder of Your Tax Coach

About the author: Barbara Schreihan started her career journey working at many different accounting firms, and she quickly noticed that her firms were lacking in customer service and tax strategies. She decided to take a risk of her own and start her own accounting business with the main goal of implementing strategies for clients to reduce the tax impact on themselves and their businesses. She now provides clients her services through tax strategy, tax preparation, and business intensives. Her goal is to customize either of these three services and implement strategies for clients to reduce tax impact for their business. For more information, be sure to follow her on Instagram or visit her website.

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