I remember the day I called my bank to open a business account. They needed a ton of different papers, a business plan, and $600 to open the account. Knowing that I am terrible with paperwork, that I did have a business plan but I knew they were too old school to understand (“You put out free content and make money? How does that work?”), and that $600 seemed a bit of a high price just to get started, I decided to look into other options.
After a few Google searches, I came across Revolut Business, and haven’t looked back since. Revolut is a financial technology company that offers banking services to both individuals and businesses. To open a bank account with them, you only need a bit of paperwork and $25 to get started (the price of the monthly membership). The verification process only takes a few hours, and you can be up and running within a day with the app on your phone.
I needed to send them a quick introduction to what my company does and a small business plan, but at least I’d know they understand it. The company was founded in 2015 and is based on mobile experience, so unlike the traditional banking world, they know about the content creation economy (a lot of freelancers use their services).
Traditional banking is old, outdated and very slow. It just doesn’t work for young companies that need to be agile and flexible. Revolut has a slick design, sends you a stylish metal debit card to your mailbox in a few days, and you can manage everything from the app, including financial reports and various overviews.
Unless you like to do paperwork (who does?) you probably won’t last long as a business owner without an accountant. Accounting is complex, making mistakes can be costly, and most of all, it asks for a lot of your time and energy which could be spend on much more productive activities.
I got an accountant as soon as I started my business, and it’s one of the best decisions I made early on in the process. The small firm I use has a fixed rate per hour, and they send me their timesheet along with an invoice every month. I often pay less than $100 per month. Anytime I have a request or a question, they get back to me with an answer via email, and they can always help with anything business-related. I’m not afraid of messing up my tax report anymore, because they do everything for me and reach out if they’re missing a document.
Getting an accountant highly reduces stress and unnecessary workload, plus it’s a business expense, so you can write it off your taxes. I highly recommend any business owner (especially small business owners) to get one.
In the first few months I started my business, I found costs were adding up pretty quickly. Because I now had a specific business bank account, I had a full overview of all the expenses, and I wasn’t sure I liked what I was seeing. It wasn’t that more money was going out than what was coming in, but I guess I was still used to my personal approach to money: save more, spend less.
In business, this strategy is one of the most sure ways to hinder growth. I’m not talking about going for the investor-approved, classic capitalist approach of burning through millions 10 times faster than you’re making them. That’s what we’ve seen happen in the past 10 to 15 years in Silicon Valley, and the approach is finally showing signs of exhaustion. I’m talking about a healthy, steady growth, proportional to the size of your business.
“If you buy things you do not need, soon you will have to sell things you need” — Warren Buffet
Here is an example. When I started working on publishing my first course called The Momentum Course, I realised I was going to have to buy a bunch of extra tools and memberships. I had to spend in the hundreds of dollars for this, and I was pretty reluctant at first. If this was my personal money, I would have rather saved it up and spent the extra time finding and using free tools. But this was not my personal money, this was business money. I realised that:
- These were necessary investments to make if I wanted to release the digital product.
- Time is money, and trying to look for cheaper alternatives would probably result in a loss of time, efficiency, and product stability.
- These expenses were investments because I was most likely going to make my money back by selling the course later on.
- Even if it didn’t work out, progress is only made through experimenting, and I could write off all those expenses on my tax report, mitigating the potential loss.
I remember showing up at the office one morning, to find my CEO really excited about a book he had just finished reading. “This is the greatest book I’ve read in a long time, you guys need to read this, I’m getting you all a copy.” He ordered 2 dozen copies of the same book with his business credit card, and a few days later a package full of books was sitting on the reception desk. Everyone grabbed a copy and took it home with them. That’s the day I realised that books, one of the most amazing sources of knowledge and self-improvement, could also be considered a business expense.
Since then, I have never hesitated to invest money in something that can be beneficial to both my business and my self. Whether it’s books, better equipment, or a paid webinar on a specific topic, if it contributes to my personal growth as a business owner, then I can spend on it and write it off.
Beyond the financial incentive, this is an amazing motivator to keep showing up everyday. Knowing that as a business owner, you get to not only grow your company but also make investments in yourself, and can get rewarded for it (both in taxes and in profit), is a great reminder of why you need to keep at it in the long term.