Startups and established businesses raising capital, follow these three steps.
As you start or grow your business you will soon be looking for ways to streamline, automate, and add quality controls to your daily finance workflow.
Trust us, the tedious tasks of expense recording, reimbursements, paying bills, running payroll, and digitizing paper receipts and bills will soon become a headache and a waste of your time as the business owner.
As a full service bookkeeping, accounting, and CFO firm we have developed many systems to save both our staff and our clients time and money while adding quality to their businesses.
With cloud-based accounting software and add-on cloud apps you can connect numerous systems through the cloud and automate many processes that used to be manual.
Here are our three favorite cloud-based accounting apps.
#1 T-Sheets: Time Tracking Software
T-Sheets is a product from the makers of Quickbooks (Intuit), and offers cloud-based time tracking software for businesses with hourly staff or consultants.
We use T-sheets ourselves for time tracking and find that our clients in construction, consulting, home services, and professional services also like the app for its ease of use, GPS navigation and geotagging, and integration into billing systems.
If you require your staff and consultants to track their time, T-Sheets can be a good fit for you.
#2 Bill.com Bill Payment Software
Paying your bills the old way requires manual step by step processes and duplicate and manual data entry. You have to take the paper invoice out of the envelope, scan it, upload it, create the bill in Quickbooks, mark it as paid, and write a paper check or submit to your bank’s bill pay function to get the check out the door.
Bill.com makes all of this MUCH much simpler.
With Bill.com, you can email forward your bills to be paid to your secure inbox where you can then code, store, and submit payment for approval by your business partner, CFO, or CEO. Bill.com will send paper checks or eChecks automatically for you and draw the money from your account.
literally, Bill.com saves us hours per week across all of our clients.
#3 Expensify for Employee Expense Reimbursement
Employee reimbursement processes can also be demanding and time consuming. If you don’t have a reimbursement policy setup, Expensify can save you tons of time.
Employees scan pictures of their receipts or invoices and submit them to the app, then code the expenses to the proper account where you can approve and submit a payment to send back to the employees, making them whole.
The process has built in controls to make your life easier and prevent any rogue employees from abusing the system.
Cloud-based accounting apps can save you lots of time and make your employees lives much easier.
Book a consultation to learn more about how cloud-based accounting software and apps can improve your profits.
Owning a business can mean being your own boss and having greater flexibility about when and where you work. It can also mean added stress as you work toward growing your business and answering to your customers. Whether you’re looking to buy or sell a small business, there are three main websites that can help you.
Meeting with a VC can be daunting, but if you prepare properly, you stand a better chance of getting the funding you need to grow your business. Follow along as we take you through some critical questions that will help you best represent your company’s strengths.
Figure out what makes your company valuable
Before you can start asking for funding, you need to have a realistic understanding of your company’s value. And not just how much you think your business is worth—it should be grounded in some sort of reality. To get you started down this path, first, it helps to honestly reflect on your company’s strengths and weaknesses.
Major factors to consider:
Strength of the management team
• What experience does the management team bring?
• Past successes?
• What makes your team special?
Size of the opportunity
• What is the value of your target market?
• What is the addressable market size for your company?
• How unique, valuable, or interesting is your product?
• Is your IP well defined?
• Do you have any traction yet?
• How tough is the competition?
• What are the challenges or barriers to entry?
• Do you have a captive beta audience?
• Have you worked with any notable partners?
• Any early wins or success stories that validate your organization?
Need for Additional Investment
• Is there anything else that is working for or against you?
• Do you have very positive existing customer feedback?
• Do you have a competitive advantage because of your location?
Think critically about how your business stacks up to the competition in each of these areas. In what areas do you excel? Where might you want to improve? One major point of this exercise is to help you determine where your business falls in the continuum of startup valuations—do you belong at the top, middle or bottom? Having more awareness about how you stack up can help you make your best case for why you deserve funding.
Coming to terms with the term sheet
Now that you’ve considered your company’s relative place in the market, it’s time to focus on more concrete topics. Before you walk into a meeting with a VC, you should already have a clear strategy for the term sheet. One of the key components of your initial discussions—and overall VC relationship—is getting this critical document agreed on.
You can think of the term sheet as a sort of roadmap that outlines the basic terms and conditions of a VC partnership—which will also be the start of any legally binding paperwork that comes later. At its core, the term sheet is about setting up protections for each party and establishing who gets what.
Before you meet with a VC, here are some questions you should consider:
Equity and options
• How much equity are you willing to give up?
• How much should you set aside for the option pool?
VC track record and past performance
• What is the VCs track record?
• How successful are they?
• What do they invest in?
• Do they invest in companies like yours? If so, how much do they typically invest?
• Have they invested in a competitor or potential competitor?
• Has a competing VC invested in a company like yours?
• Are they missing out on a growing new segment?
• Are there potential opportunities for additional cross-collaboration—have they invested in companies or technologies that may be beneficial to you?
• Similarly, could your company provide additional benefit to companies they are already investing in?
As important as it may seem to get the highest possible valuation right out of the gate, the term sheet is just a starting point down a much longer road. Everything that is negotiated will significantly impact your business now and in the future—so be very thoughtful in your approach. Though there will still be a lot ahead of you, some honest reflection on your prospects is a great place to get things started.
About Pinewood Consulting
Do you need outsourced accounting services for your business in Connecticut or New York? Call Pinewood Consulting at (203) 286-8719 to get a quotation for bookkeeping, taxes, acquisitions, and other financial related matters. Chad Pavel is a Stamford CT and New York CPA.
If you are an entrepreneur, business owner, or thinking of starting your own business, this article is for you.
On Thursday, 10/26/17, Datto, Inc. announced its plans to sell to Vista Equity Partners and merge with Autotask, a related Information Technology company. This acquisition deal, which is surely valued at over $1 billion is big news for M&A, venture capital, the technology services industry, and entrepreneurs around the world.
I worked at Datto’s Norwalk, CT headquarters for three years as a sales rep. And now I am a Datto customer and advocate to my clients. You can read Austin’s interviews all around the internet, but here’s what I learned from having the privilege of working for Datto.
Austin McChord started Datto in 2007 in his father’s office basement using his curiosity, ability to build things, and a few personal credit cards to build his first data backup product.
TL:DR Version: Austin McChord the Founder:
Started in a basement at age 22
Assembled first computer products with glue + legos
Struggled to find revenue for over two years
Had to fire (then rehire) friends
Ran up credit card debt for parts and marketing
Made sales to scrape by
Faced product returns
Almost shut down
Didn’t pay himself
Got sued multiple times
After two years of working to find meaningful sales (and temporarily laying off a few of his friends) Austin had his first break weeks before closing up shop when a tech blogger embraced Austin’s dozens of emails and phone calls and reviewed the Datto product for his readers. It worked, and Austin sold enough to stay in business and turn a profit.
Through many iterations of the Datto product line, Datto’s backup and disaster recovery products are still flying off its Monroe, CT warehouse shelves to small businesses around the world, now being distributed and served by almost one dozen offices and data centers around the world.
Despite being a 20-something with a nearly 6-figure credit card balance and no “real-world” technology or business experience, how did Austin McChord defy the odds and go from a “C” college student to turning down a $100 million acquisition offer to selling his company for over $1 billion by age 32?
An Insider’s Perspective
After working at Datto for nearly three years (before going full-time on Pinewood), I observed live, in person, several qualities in Datto’s CEO that resembled those found in entrepreneurs most of us can only read about in blogs and magazines.
1.He focused: Austin McChord started Datto to avoid getting a job. He built his first product by piecing together computer parts with hot glue and lego blocks. How many friends of yours would spend their 20’s sitting in a basement building computers and racking up credit card debt not on beers and vacations but on computer parts and server space? Tip: Find a market problem that you can solve and build a solution to address it quickly, no matter how ugly or unpolished it may seem at first. Be prepared to be “that friend” who doesn’t go out every weekend so you can work on your business.
2. He’s stubborn: Would you keep going on your business idea even if it was costing you thousands in interest payments and causing you tons of stress? Would you make 1,000 cold calls and pretend you had 5 employees even if it were just you in a basement doing it all? Austin did, and he sold products to big companies doing it. He also didn’t take venture capital investors in the early days and even turned down a $100 million buyout before age 30 because he had bigger plans. Tip: Once you commit to your business and have people ready to buy your products, do whatever you can to fund it yourself. Get a night job, sell stuff on eBay, get a credit card, get yourself some sales and make your product better each week. Go as long as you can without investor money and you can control your destiny. Datto was generating tens of millions in revenue before taking professional investment.
3. He listens: Austin McChord listens to his customers and trusts his employees. He might even up-vote this article (Austin?). When the early products had flaws and Datto’s customers called in demanding refunds and replacements, he did it. When employees asked for better benefits and perks (like better health insurance or even a ball pit), Austin made it happen. He still attends trade shows to sit in Datto’s booth to interact with customers to stay in touch with the market. Tip: Your customers and staff will tell you how to keep them motivated and buying into your vision. Take the time to listen and talk with them daily. And you’re never too busy to attend a trade show or build a ball pit in your office.
4. He’s honest: Datto has an “anonymous question” forum where Austin answers questions from employees and emails them to the entire company. He leaves his keys to his Tesla on his desk for staff to take it for a spin. He personally emails his 10,000 partners when Datto releases a bad update or buggy product. He admits that he almost failed at formal education and just wanted to build something that would pay him a $100,000 salary someday. Tip: Ask for feedback. Tell your customers when you screw up and they will respect you for it and give you time to fix it before going to your competitors. Be transparent with your staff and they are more likely to embrace change and big decisions when they may not make sense at first.
5. He motivates: The motto at Datto was it’s better to ask for forgiveness than ask for permission, which gives Datto employees power to do better work without bureaucracy. Datto’s monthly town hall meetings were always packed with transparent insights on the company’s goals, product releases, and private news that ALWAYS stayed private. Austin McChord even buys lunch for every office each Friday and sits with the staff to talk. Tip:Your staff and customers are your business. Once your business is running, focus on being a leader, a coach, a visionary, and trust your staff to do their jobs.
Datto’s success story can teach entrepreneurs a few good lessons. As Datto continues to grow with Vista Equity Partners and Autotask with Austin at the helm there is no doubt that the combined companies will continue to be a powerhouse in the Information Technology world.
And the lesson for entrepreneurs. Clearly, you don’t have to be an industry veteran, a PHD or MBA, or have worked…anywhere before, to start a company and earn a living for yourself or in Austin’s case, build an asset worth over $1 billion.
So – What’s your excuse?
Do you need a pitch deck?
When most people hear the word “pitch deck” they think of VC-backed unicorns like Airbnb, Yelp, Facebook, or WeWork and investment bankers from Goldman Sachs, JP Morgan, Citi Group or Credit Suisse.
However, pitch decks have evolved from tools of Silicon Valley to strategy boosting methods of every day companies, nonprofits, and local businesses.
Here are 20 ways you can use a pitch deck to win new business, present your idea, or help your nonprofit thrive.
Unique scenarios that require a pitch deck
Software Startups: The most obvious. If you are a software startup entrepreneur seeking a seed capital from angel investors and venture capitalists, an investor pitch deck is an absolute necessity for raising money.
Starting A Local Business: Starting a new local service company like a construction firm, plumbing business, or commercial cleaning business, you may be approaching banks for a start up business loan, equipment lease, or SBA loan.
eCommerce Business: Raising money to purchase inventory, secure key supplier relationships, and secure new customer accounts and purchase orders.
Real Estate: Seeking capital to purchase or build real estate or pitching your city’s local economic development council to develop a piece of land.
Family Business: You own a family business and need an SBA loan to expand your business, acquire new assets or or buy a competitor.
Management Buyouts: Your employer is ready to retire and has no successor in the business and you want to present your case for acquiring the business when the current owner retires.
Buying a Business: You are seeking capital to acquire your first company and approaching individual investors or bankers for capital.
Opening a Restaurant: You are starting up a restaurant or food truck concept and raising capital from friends, family and your local bank.
Opening a Retail Store: You are opening a retail location in a strip mall, traditional mall, or outlet center and must present your business plan to the landlord to show that you will be a good fit and cover your lease payments.
Pitch Competitions: You are competing for investments or grants at a local pitch competition and want to capture the audience and sponsors with your new concept to win cash.
Startup Accelerator Applications: You are applying to a startup accelerator or incubator like 500 Startups or Y Combinator and they require a deck for your application.
Government Grants: You are writing grant applications to fund research, development and marketing to solve a novel problem.
Crowdfunding: You are building your profile on an equity crowdfunding platform like Indiegogo, Fundable, Kickstarter or SeedInvest.
Sales Presentations: You are making a sales presentation to a new potential customer and need to organize your value proposition in a compelling sales pitch deck.
Nonprofit Fundraising: You are a nonprofit and raising funds from donors at a dinner event for charity gala.
Joint Ventures: You are seeking joint venture business partners to coinvest in a new initiative and must show proof of your skills and past successes to secure key partnerships.
Fortune 500: You’re a fortune 500 company and seeking to partner with or acquire smaller companies and must communicate your fit and value to the founding teams.
Trade Show Presentations: You were presenting at a trade show in front of hundreds or even thousands of people and want to create a stunning visual presentation.
Chamber of Commerce: You are giving a presentation at your local Chamber of Commerce and want to impress local business owners with your business presentation skills and portray your value in the community.
Political Campaigns: You are running for office and want to describe the economic or social problems in your town and how you will go about solving them.
Regardless of your personal or business needs, creating a stunning and smooth pitch deck presentation can accelerate your success and improve your chances of getting what you want. Taking the time to build a professional pitch deck can change your business forever, and developing presentation skills to complement your pitch deck are even more important.
Nee help with your pitch deck? Book a consultation to learn about our process and how we help companies raise capital with stunning pitch decks every day.
Are you raising money for your startup? Having trouble getting anyone’s attention? Investors, customers, lenders?
There are two immediate fixes that you can start with TODAY to get your business moving forward.
#1: Refine your story.
The FIRST thing you need to do as an entrepreneur is to get your story straight. Who are you? Why are you relevant? What problem are you REALLY solving and why should anybody care?
Pro Tip: Practice your 10, 30, and 60 second pitch. Focus on the problem or desire you address, the size and relevance of the number of people who share the problem. Present your solution and why your audience will benefit from working with you.
#2: Show proof.
Ideas are a dime a dozen. Everyone has them! And while it is easier than ever to create a landing page and “fake it” for awhile, a savvy investor and customer will see right through you. Show proof that your new and novel idea is relevant. Show that people care!
Pro Tip: Gather email signups from your customers. Post on Facebook and start conversations. Pre-sell your product to a few dozen customers (actually collect cash!), and show the world that people care enough about your product to sign up with you!