Accounting is never fun. It distracts you from the primary purpose of honing your craft and contributing your best to the world. However, it is one of the most valuable skills to master for any business.
Most of the freelancers and startups fail because they can not build a healthy cash flow. You need to make money first, to spend it on tools, talent, and a fancy office.
To tell me more about accounting and invoicing I am talking to Shalom Stark, the co-founder of Invoice Ninja, free open-source invoicing and time tracking software.
Why so many small businesses and freelancers fail?
I’m a believer in limiting risk, and the biggest risk for a freelancer in my personal experience is overhead. You don’t need the most expensive laptop to start a company. You don’t need an impressive office with an espresso machine. You also don’t need overpriced SaaS and cloud tools.
Listen, if you’re a solopreneur, choose free tools that are relevant to you. Salesforce is probably far too expensive at $300/year and has too many features you’ll never use. Check out Streak, a Gmail plugin or similar options which are free. If you need a newsletter, don’t import all your friends and family contacts into MailChimp or Mad Mimi, start with clients only and begin on their free plans. If you need invoicing, Invoice Ninja is 100% free. Go with a free form builder. You probably don’t need ten different forms, stick with a free plan with 1 or 2 forms on your site to generate leads.
Don’t spend money before you make it. Leverage SaaS tools for free until you’re so big you need to upgrade.
If you have a great month in business, gain clients, amazing, keep it all and enjoy it. If you have a bad month, miss sales targets or lose bids, it won’t be the end of you. I’ve seen many colleagues fail from overspending before and during their startup period.
What’s your advice to anyone starting a business?
It might seem silly, but treat every single person you meet like gold. Certainly every client, but also your team.
I’m a big believer in outsourcing. I have an assistant in Montana, a graphic designer is in Texas, SEO guy in Jersey, and a content writer in Jerusalem. Although I don’t meet the people I work with, I am as polite and thankful as possible with them. I try to communicate as clearly and detailed as humanly possible, and I always, always pay promptly.
