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Wish Group

Ask Frank

By | Wish Group, Comments & Opinion, Business Insights, Business Growth, Business Health, Foundations of Success, Leadership | No Comments

Ask Frank

Today highlight some of the comments and questions you submitted and getting Frank’s response on all topics.

As discussed previously funding is hard to obtain especially when asking from friends/family. It’s important if you go that route to understand at all times this is a business transaction. It’s not your money, and there is risk associated with borrowing money from people close to you. Notify them of the risks involved, possible obstacles and a realistic time frame to see an ROI, in addition, how you will handle these obstacles. Treating it like it’s an official pitch to a bank or investor helps take the emotion out of the situation and keeps everything professional.

Making a move to hiring a finance person is always tricky because it depends on what stage your bootstrap startup is currently at. Most time you may be able to sustain with an in-house bookkeeper a few times and transition them into a full-time position. The risk in going to a senior accountant before necessary is the cost associated can be expensive and sometimes unnecessary. Instead, consider having a person who can perform the daily accounting procedures until you reach the point where a CFO is needed.

What to Look For in Your First Office

By | Wish Group, Business Insights, Foundations of Success | No Comments

What to Look For in Your First Office

When starting off a business everyone needs a location work out from, but most bootstrap startups are unsure what options they have and what does it look like? Today we’ll discuss the best move for your bootstrap startup.

Working from home vs. office is a debate that nobody has mastered, but both provide their own advantages and disadvantages. Firstly, your main concern should be to keep costs down. Working from home gives you that freedom and space to move in a space which you’re comfortable and avoid having to sign leases. However, it may come at the disadvantage of not establishing the company culture and collaborate on ideas with others.

Working in an office is much easier today than its ever been. Things such as shared offices, small rental units, and collaborative spaces/software all help with growing a business. Staff get the chance to discuss ideas, build relationships and collaborate together. Although, this might require longer commute times to work, and additional costs for the renal space.

Ultimately, the decision will be based on the type of business you are conducting, and if the home/office culture is where you will thrive the most. For example, tech-based companies may be interested in an open concept area with lounge and relaxation space because staff want an area away from their computers. Contrarily, a sales culture where staff are working independently speaking to clients and want to be in a home environment or have a dedicated desk. Some companies are exploring the option of a hybrid office, which has both features, so they can cater to all personality types and working styles.

Finally, the hardest part is determining how much space you will need as a startup. As s bootstrap startup its hopeful to expect your business to grow as the years go by, but there is never a guarantee. Most rentals are 3-5 years so the best way to determine what to do is take a realistic approach to your business and assess if a larger office contributes to the growth of your business and the bottom line. A bad office lease or too expensive office can cripple your business quicker than anything else.

Always Be Selling Pt 2 – A Brave New World

By | Wish Group, Business Insights, Sales Advice, Foundations of Success | No Comments

Always Be Selling Pt 2 - A Brave New World

The sales industry has changed from the old school, knock on your door days, and referrals. People pick up the phones less, buyers are more educated, and sellers now need to take a modernized approach it customers. Understanding how to run a formalized BDR/SDR (Business Development Rep/Sale Development Rep) program is essential to staying active in the sales industry, including sending out emails and other touchpoints to prospective clients to make a sale.

Exhausting every option to gain a customer’s interest is now industry standard. The amount of activity and resources spent to make a sale has increased because the amount of relationship building with customers in the pre-sale stage has decreased. Sales are now primarily driven by campaign data, so business owners can start to understand where sales call drop-offs will be, expected responses, and bookings.

Hiring sales staff that are able to quickly understand the different types of personalities when speaking to people and adjust to them will bring in more sales every time. Using a combination of a call, voicemail, email, and backed up by marketing messaging (documents) provides the highest rate of success. Ultimately, coming up with a sales strategy, including script, target market, and campaign (based on data) will give your business the best opportunity to succeed in the sales field.

How to Set Up Your Finance Department

By | Wish Group, Business Insights, Business Growth, Business Health, Planning for the future | No Comments

How to Set Up Your Finance Department

Everyone is well aware that having a finance department is essential for any business in all industries to progress. However, when comes to startups its more about when is the right time to set one up, and who will be responsible for overseeing the company’s finances. We’ve seen the difficulties many startups are having with this conundrum and came up with a few tips to help you get started on setting up your finance department.

When a company is just getting started and can’t afford an accountant one of the best moves is look into accounting software programs. Options such as QuickBooks is reasonably priced and will do the number crunching for you. Most startups do their own accounting using multiple spreadsheets, ledgers etc. but technology has created a way for startups to save time on doing math and more time on marketing the business. Utilize the ability to let a computer do the work for you and start figuring out a way to get paid from any outstanding receivables.

Live within your means when it’s time to expand. As the business grows in revenue, you’ll need more help handling the finances, and hiring an accounting firm can be very time costly experience if you don’t know what you’re doing. Research both large and smaller firms, be clear about your expectations and budget when speaking to their agents. Do not discredit smaller firms because on occasion they can produce the type of financial assistance you require within your budget and building business relationships never hurts. A lot of startups can get swept up in the appeal of a large financial firm taking over but unable to maintain the costs associated. There is nothing impressive about going with a big firm if you don’t have the big budget to match it. Keep it simple.

Finally, consider hiring contract, part-time, or freelance bookkeepers to complete your finance department. Not every business needs a full time dedicated finance department. Take advantage of these options and seek outside help who can pick up some of the workloads where your business may be falling short. It’s usually just as effective and keeps costs low while you wait for your business to take that next step up in revenue to hire full-time staff.

S2E4 – How to Set Up Your Finance Department

By | Season 2, Episode 4, Wish Group, Bootstrap | No Comments
Mr. Matthew Ley:  Welcome back to Boot Strap: Insights for the Self-Funded Entrepreneur with Frank Cianciulli.  My name is Matthew Ley, and I will be your host.  As we discussed last time, we’re going to go back to one of your questions, and we’re going to talk about setting up your financial organization.  Just like no company can really get going without any source of funding, how you manage that money can make or break your company.  And Frank has got a lot of experience, a lot of different sizes of companies in your history.  So let’s talk about it.  There’s a couple options when you’re starting.  You can do it yourself.  You can get a little bit of help.  Or you can bring in an accountant to be full-time on your staff.  What do you think is the best move for a bootstrap startup?

Mr. Frank Cianciulli:  Well, as a bootstrap startup, by definition, I’d say it’s do-it-yourself.

Mr. Matthew Ley:  Okay.

Mr. Frank Cianciulli:  And obviously from a financial perspective it’s important, but I mean let’s face it; I mean if you’re just getting started there probably isn’t a lot of revenue just yet.  There probably isn’t a lot of accounting to be done, and it’s actually, you know, from just a controls perspective or really understanding your business, at least I did it myself with, you know, a couple of our guys, our sales guys for the first year or two.  You know, entering your own receivables and payables and bills and invoices into our, you know, there’s great accounting packages that are really easy to use.  QuickBooks comes to mind.  It’s so user-friendly.  You don’t have to be an accountant to use it.  The reports are amazing.  You press a button.  So I’m more of an advocate that you should try and do it yourself and save the overhead.

Mr. Matthew Ley:  Well, you know, people go to school for many years to be an accountant.  You can’t walk into being a CA.  What is the benefit of you doing it yourself in those early days?

Mr. Frank Cianciulli:  I think it just gives you a lot of visibility into your business.

Mr. Matthew Ley: Right.

Mr. Frank Cianciulli:  You know, sometimes if you rely too much on accounting and you don’t understand the numbers, you know, we rely on accountants to — or you know, our accounting department to give us best practices and forecasts and help us make business decisions.  But sometimes that doesn’t translate.  You know, oftentimes accountants are black and white, but there is a lot of nuance to business that you as the operator, the owner, know more than they do.

Mr. Matthew Ley:  Yeah, and I mean the last time I saw a balance sheet before I started looking at them in the business was probably my grade 11 business class back at StJean de Brébeuf in Hamilton — a little bit of a shout out there.  So I mean I remember the principles of it, but getting a completed financials was, I had to learn again when I got into business for myself.

Mr. Frank Cianciulli:  Well, let me just give you one example that I faced early in my business career.  When, you know, because we kind of took our eyes off let’s say receivables.  So [unintelligible] our cash, and then when I ran a report from QuickBooks, you know, I said oh my gosh, we’ve got customers that haven’t paid us in 120 or 180 days, and that really forced us to get on top of receivables and roll out a process.  If I didn’t have the visibility I mean I assume at some point, you know, a financial professional would have said hey, someone’s got to get on top of this.

Mr. Matthew Ley:  Your DSO is out of control.

Mr. Frank Cianciulli:  Exactly.  But that being said, you know, if you have the wherewithal there is wonderful services out there.  I think CFO For Hire, or there’s a few different companies that basically provide you outsourced at I think fairly reasonable prices.  Freelance bookkeepers is probably all you need, as well, and effectively — so I’m not saying, you know, there’s not ways to hire kind of part-time help that will be very cost-effective.  If that’s an option, yeah, I would recommend that within the first 3 to 6 months, especially if you have no financial wherewithal.  And you want to be focused on growing the business, so I think that is a valuable investment.  I’m just telling you what we did.  We definitely did it ourselves for the first year.

Mr. Matthew Ley:  So you did it yourself, and then you went to one of these outsourced organizations, or did you bring in somebody?

Mr. Frank Cianciulli:  No, we brought in — we brought in someone after about your one, year two.  You know, it was a little bit longer.  It was probably a year and a half in, and we were experiencing a lot of growth, so we managed a lot of revenue.  When I say we it was kind of me and one of my operations guys.

Mr. Matthew Ley:  Okay.  So after a certain point in time — and you would have experienced this in your first business because you guys did grow really quickly.  You were in $5 million in a couple years into the business.  You’ve got to bring in the big guns at some point, right?

Mr. Frank Cianciulli:  Correct.

Mr. Matthew Ley:  So you’ve got to bring in like the BDOs or the PWCs to do what’s referred to as review or an audit.  So at what point do you need to bring them in, or why would you?  And at what point is the review versus audit make sense?

Mr. Frank Cianciulli:  Yeah, those are great questions.  So yeah, first and foremost, like we talk about as far as hiring, you know, seasoned talent and when you bring them in, it’s the same thing with your accountants, or lawyers or any of that thing.  You know, when you’re a startup you don’t need the big four.  It’s overkill.  You know, people say well it looks good that you’re with KPMG.  I get that.  You know, at some point when you’re large enough that makes sense, but there are so many amazing small accounting firms that are more than able to handle your needs, and they’re more geared toward small businesses.  Their prices are a lot more reasonable and fair, and you can get access to them very well.  And it’s easier for them to understand your business.  So I would recommend until, you know, depending on your business, but I would say up until $5 million or even $10 million in revenue, a small, a smaller accounting shop or legal firm is what you need.  At that point then I would look into potentially the majors.

And the same thing review, Notice to Reader or an audit, you know, audit usually if you’re preparing your business for a sale is when you would want an audit.  So as a startup I don’t think you’re thinking that yet.  You shouldn’t be.  Even a review engagement is really only necessary if you actually bring in some kind of financing, like bank financing.  Otherwise a Notice to Reader, very cost-effective even with a big six accounting firm is probably only a couple thousand bucks.

Mr. Matthew Ley:  Okay, so a Notice to Reader, you know, when do I need that, or why do I need that?

Mr. Frank Cianciulli:  Well, you’ve got to file your taxes even if you’re not making money.  So they’ll do a tax prep.  And a Notice to Reader basically is showing you that yes, we’ve confirmed the numbers are accurate, but they haven’t — the difference between a Notice to Reader, review and an audit is just different levels of essentially checks and balances or confirmation of every single expense.  So really it’s not really until you’re a public company that you even do an audit.  Even very, very large private companies, especially if they don’t even have any kind of debt, are even doing Notice to Readers or reviews.

Mr. Matthew Ley:  Okay, so when you started the business it was, you know, what we remember from when we were kids.  You’re a little bit older than me.  Everyone paid by a check.  The check went into the bank.  You know, there was a person that you gave it to, and then you sent your checks out and you signed them.  But we’re in a different world now, and risk that some guys starting their business — or gals — starting their businesses right now have that you didn’t is this cyber threat, the fraud that is going on there.

Mr. Frank Cianciulli:  Very concerned, yep.

Mr. Matthew Ley:  You were telling me that you even got hit by this, and your organization is quite large and a lot of controls in it now.  Does that mean that maybe we need more financial, like call a larger financial organization sooner now to protect ourselves?

Mr. Frank Cianciulli:  No, I mean I think you just need best practices as far as, you know, things like signing authority, things like how to authorize a wire, you know?  I mean if you let someone in your accounting department, you know, be the sole person to sign a check or to wire funds, I’m not saying they would intentionally fraud you from an internal perspective, but things can happen.  People are hacking emails now, and you know one of the big prevalent scams, so to speak, is, you know, an email from the CEO to the finance department saying hey I need you to wire funds to this supplier.  And you know, they’re in your email, so it looks like it’s coming from you.  Next thing you know your financial person just wires a bunch of money that you can’t afford to some fraudster.  And so the key is to just eliminate, try and eliminate human error.  And that’s where processes and controls come in.

Mr. Matthew Ley:  It’s interesting you bring that one up because, you know, we’ve looked into it, and that is actually targeted at folks like yourself, an entrepreneur, because in a larger organization the CEO is not going to ever make that request, but when you’re in the business like you are or [unintelligible] —

Mr. Frank Cianciulli:  You’ve got to play [unintelligible].

Mr. Matthew Ley:  Yeah, you’re doing all of that.

Mr. Frank Cianciulli:  You know, you’re flying by the seat of your pants.

Mr. Matthew Ley:  Exactly.  Or sometimes your credit card is being used for whatever it might be.  The money is not as clean as it is in a large publicly-traded company, so they target people, people like yourself.

Mr. Frank Cianciulli:  That have less infrastructure processes.

Mr. Matthew Ley:  Yeah, exactly.  They’re counting on you to —

Mr. Frank Cianciulli:  To make an error.

Mr. Matthew Ley:  To make an error, and in some cases they are right, but it’s not just that.  It’s everywhere.  So it is definitely something to look at.

Mr. Frank Cianciulli:  So those [unintelligible].

Mr. Matthew Ley:  Yeah, definitely.  Okay, so with that we will be moving on to another review or an update from season one.  And just like the world has changed since Frank started his business and cyber threats are a bigger deal, so has the buyer changed in the sales organization.  And last year we talked about always be selling, and now we’re going to talk about always be selling in the modern world.  Until that point in time, stay lean, guys.  Like, share, invite your friends, loved ones and coworkers to watch the show, and we’ll see you next time.

Hiring for a Startup

By | Wish Group, Business Growth | One Comment

Hiring for a Startup

The process of hiring a new employee can be complex and tiring, let alone if your business is a start-up. Start-ups are unique business’ and rely much more on their staff achieving their goals and overcoming challenges that most larger business no longer require.

A key strategy in hiring for a start is, hire for potential not just track record. Past success is always great, but in a start-up, industry potential may be greater. Look for a person who has a strong interest or passion for the type of work your start-up is doing and see if their values align. Measure what potential you can unlock their skills and determine if the job position will give the applicant a chance to succeed and you’ll likely see results.

The culture fit is crucial. This is usually the hardest to pinpoint but it’s always important. Basically, it’s the fit between personality and organization. You will need to examine the behavior, attitude, and mentality of an applicant to see if they’re the right culture fit for your business. There is no guide to fitting into the right culture, it’s more of a feeling and unspoken understanding. Trust in your hiring staff to make the right decision and ensure they ask applicants questions non-work related to find out more about their personality.

Lastly, look for trainable people. Regardless of experience and culture fit, you will always need to train the new person. In a start-up industry training is essential to continued success. If the applicant is hesitant to new ideas or training styles and prefers to do things “their way” you may be setting you and them up for failure. Furthermore, ensure their ability to adapt to changing environments since the start-up field is constantly changing. Being unwilling to be coached or help coach others is how most new hires fail in their first year with a start-up.

S2E3 – Real World Example: Hiring for a Startup

By | Season 2, Episode 3, Wish Group, Bootstrap | One Comment

Mr. Matthew Ley:  Welcome to Boot Strap: Insights for the Self-Funded Entrepreneur with Frank Cianciulli.  My name is Matthew Ley, and I will be your host.  On season two of Boot Strap one of the things we said we were going to do is look back at some of the most popular episodes that elicited the most engagement from you.  Our first episode, “People and Hiring Best Practices,” talked about what type of employee you should be looking for when starting a bootstrap startup.  And one clip brought up a lot of comments, and we’re going to play that clip for you right now.

“Anyone who has ever been through The Wish Group or met Frank has probably heard him say at one point in time, that Frank prefers ignorance on fire to knowledge on ice.”

So comments like that, and Frank, I mean you echoed them later in the series when you said that one of your big Frank-isms is that you prefer ignorance —

Mr. Frank Cianciulli:  On fire.

Mr. Matthew Ley:  — on fire to knowledge on ice.  But you know, when you talk to people out there about the current employment landscape, a lot of these people are coming in with not a lot of experience, or younger, and we hear a lot about how they’re just different.  It’s hard to find that diamond in the rough who is going to succeed this way.  Do you got any experience or any examples in the last maybe two years of someone who this happened with?

Mr. Frank Cianciulli:  We do, we do.  And you know I just want to preface that by saying, you know, a lot of people at our generation and older will always say that, you know, the new people coming up, or you know we talk about millennials, don’t have that fire.  It seems to be missing.  And I can’t comment on that because I don’t have a reference point 30 years ago to compare.  But I will say we’ve, you know, a great example is a guy we had that, you know, relatively young, but no B2B experience, didn’t understand anything about our product, but you know, you meet with him, and I’m sitting across from him, and I’m looking into his eye, and I just know there is the fire.  There is a hunger for knowledge.  And he wanted to grow and learn.  And you know it’s hard not to take a chance when you find someone like that.

Mr. Matthew Ley:  Right, and I’m assuming you had opportunities maybe to hire from competitors at this stage.

Mr. Frank Cianciulli:  Of course [sp].

Mr. Matthew Ley:  You’re not an early-stage startup anymore.  So what happened?  How long ago was that, two years ago?

Mr. Frank Cianciulli:  Yeah, about two years ago, yeah.

Mr. Matthew Ley:  So you know, talk to me about his first year, you know, what happened in that year and maybe where he’s going to [sp].

Mr. Frank Cianciulli:  Yeah, and typical — and that sometimes, you know, especially in a startup you think oh, do I go with a guy that has the experience, that maybe has a book of business he can bring over?  But you kind of know that they’re not going to be stars.  And so, but with this guy so you knew year one it’s all about learning, learning the products, getting comfortable on the phones.  He definitely wasn’t afraid of the phones, which was excellent.  That’s what you want in sales guys.  And then year two it really — I mean he had some success in year one, but year two is really where he started coming into his own.  You know, and just recently he said he’s never made more money in his career, and by year two, and in year three we’re looking at this is a guy that, without question, would have outperformed any senior guy that I would have hired.

Mr. Matthew Ley:  Yeah, so you’ve got to be pretty happy with that, two years to that level.

Mr. Frank Cianciulli:  We love when that happens.  That’s like a professional sports team drafting a young player that turns into a star within the first couple of years.

Mr. Matthew Ley:  How does he feel?  Like what — is he — I mean is he a kind of guy that’s really into what’s going on in the company?

Mr. Frank Cianciulli:  Oh, he’s become a cultural warrior.  He’s taken on so much leadership, as well, where you think hey, some of the things that he does, taking ownership over calls, I mean man, the guy is even coordinating our office move this past month.  These are some of the things I would have hoped my veterans would’ve kind of jumped all over, but you know the thing with ignorance on fire, especially once they then acquire the knowledge, is you’ve got a cultural warrior.  You’ve got an all-star.  So really great companies have to have that kind of — I call it a farm system, where you’re incubating your own talent.  And there’s more loyalty there, too, as well.  I mean I know everyone’s always afraid of having those kind of people being a flight risk, but there’s ways to maintain and to retain those people.

Mr. Matthew Ley:  Yeah, and I mean it’s one of the reasons why you lose anybody out there is when either side feels there is an inequity, right?  As an employer you don’t feel like they’re doing their job, and as an employee they don’t feel like the company is giving back the effort that — to the effort that they’re putting in sort of thing.  You brought it up.  It’s constant growing concern, right, when bringing in entry-level employees there is a knowledge that, you know, they’re in an entry-level.  They can easily jump to another entry-level for maybe $5,000 more, or closer to home, or on the subway line, or whatever it might be.  Are you — clearly you’re still hiring entry-level employees in different businesses.  What are you doing today to ensure that, you know, they grow into like this guy that you were just talking about?

Mr. Frank Cianciulli:  Yeah, and I don’t know that I’ve got, you know, the answer that will solve that problem, although I can share our experiences that have helped us.  You know, I don’t know if it’s just a millennial thing.  I think people of all ages, you know, when you’ve got a hot job market and people and recruiters are calling them, and it feels good when someone wants you and is offering you more money.  That being said, what I’ve learned with even millennials is that if you show them a path to how to grow, because oh they feel entitled, and they want to be VPs immediately, no they don’t.  They don’t.  But they at least want to see a path, and so that’s something we’ve been doing as well.  We let them know exactly what’s expected and where they should be in year one, and what the behaviors and what success looks like in year one versus year two and year three, and what the leadership potential — some people aspire to leadership, and that’s great.  As long as they can see that you’ve got a plan and you recognize that skill in them, then they’re vested to stay.

Mr. Matthew Ley:  Right.

Mr. Frank Cianciulli:  You know, and then obviously pay them as you go.  Again, I hate to use those sports analogies all the time, but if you’ve drafted a rookie and he’s been a star, you know, you sign him to a cheap entry-level contract.

Mr. Matthew Ley:  Yes, exactly.

Mr. Frank Cianciulli:  But then you’ve got to pay him.

Mr. Matthew Ley:  Yeah, you’ve got to pay up when he comes of age, right?

Mr. Frank Cianciulli:  Exactly.

Mr. Matthew Ley:  Or, you know what, be ready to let them go.  And in some businesses the economics of it doesn’t justify having a lot of those high-priced players.

Mr. Frank Cianciulli:  That’s right.

Mr. Matthew Ley:  Doesn’t mean they didn’t help you for two or three years, and you know, going to be happy for them to go off somewhere else and be successful.

Mr. Frank Cianciulli:  And you know what, there’s something to be proud of that, as well.  You know, I mean like every business we’ve had people that have moved on to great opportunities, and I’m proud of that.  I mean, if we were able to help, you know, shape that person’s skills and careers and help them realize their goals and dreams and indirectly help their families, that’s what’s wonderful about being in business and being an entrepreneur is that’s your way of giving back just in itself, creating employment and helping shape people’s lives.

Mr. Matthew Ley:  And that’s actually — you know, a lot of you out there, we know those are you, people who have come through The Wish Group, because a lot of you left comments in season one.  Okay, next episode we’re going to get back to some of your questions and the stuff you were talking about, and again, a lot of questions about finance, so what we’re going to do is we’re going to dive in on basically how to set up your financial organization.  Do you DIY?  Do you bring someone in?  Do you use a rental player?  All that and more on the next episode of Boot Strap.  Until that time, guys, keep it lean.  Share this with your friends, family and loved ones, or anyone you think might be interested.