Finances For Big Dummies
How did you get started with Supporting Strategies?
Supporting Strategies is a franchise that was started out in Boston near MIT. They started right across the street from MIT in a co-working space in the early 2000s. They grew that business throughout the Boston area, and as time went on, they got to be a $5 million business. They brought in two angel investors, and one of them talked to them about franchising. Franchising is a way to go into something like this and grow fast without spending a ton of money on developing a sales team and all the rest of it. So, there are 77 Supporting Strategies now, and someone owns each one. They do have a mothership that they all talk to when it comes to things like HR hiring or technology. However, Mark does make the decisions about how he works with a customer or how he handles different issues that might come up.
They have absolute authority when it comes to pricing and that sort of stuff. There are rules about what they can and can't say in some cases, but most of the time that's set by the state. For example, in Texas, Mark couldn't call himself an accountant if he doesn't have a CPA. So that's why a lot of times, like in their marketing material, they'll say we're bookkeepers and controller level services. Still, everybody that they are hiring, for the most part, has either a CPA background or they've got that sort of corporate accounting type background.
Working with your financial department should be a partnership.
Mark made the point that working with a financial service like theirs should be a partnership. He shared that anywhere that he's worked in the past, whether it's corporate America or for himself, that finance should be an extension of the business. It shouldn't be running the business, and it shouldn't be somebody you're afraid to talk to. In some ways, they're almost like a coach for your business to some degree because they're helping you understand, "what could I do differently to take home more money or to do things more efficiently?"
Transitioning from corporate America to owning your own business:
Mark started his career at a bank that was, as he described it, a hot mess when he got there. They wrote off $6 billion in the first three months because of either bad accounting or managerial issues. He got a ground-level view, and they didn't have a budgeting process. They didn't have a planning process. They had no monthly or quarterly reporting. He got to see all that firsthand and cut his teeth in a hot environment at the time. He put in a lot of hours and paid his dues. As they merged with JP Morgan, he was part of the merger integration team for their high net worth segment. He focused on what was the financial impact of this merger as well as the non-financial side like "how do they brand themselves?" "what mutual funds we want to keep?"
While he did that, he noticed that at that time, everything was moving to New York. He had determined that he didn't want to live in New York. So, he went left Chicago and moved to Milwaukee and got a job with GE, which he swore he would never work for. But he liked the people that I interviewed with, and It was almost run like its own little small business. There's an image that comes with GE that that may or may not be entirely accurate, where they churn through people. They constantly rotate where they're working and all the rest of that.
This was actually a pretty long-tenured team, and some had been there for 10 years in some cases. So, they were always sort of their own little Island until GE hit some tough times. Then all of a sudden, everybody was looking for life rafts and businesses that were working well. And theirs happened to be one of the ones that were working well. So, it suddenly became a lot more corporate, and Mark started not to enjoy it as much. And then, when they went through their last restructuring, rather than taking a role in Chicago, he ended up just taking his package and walking away. Then he figured he'd start talking to some of the headhunters that were out there that have been calling him for a while. He looked at a couple of private equity CFO roles, and some of them required moving, some of them didn't.
But then he got a call from a franchise coach, and the franchise coach said, "I want to talk to you about your future." He was thinking, "I don't want to own a McDonald's or a Wendy's" because that's what you think when you hear "franchise." However, he talked to Mark about a couple of different businesses, which really resonated with him because he knew the operational side of what he'd need to do. What was hard was he had to transition into "how do I sell?"
If you're in the corporate world and you're dealing with other individuals and other stakeholders, you've got to be somewhat persuasive that this is the right thing to do. But owning a franchise is very different. You have to get out there and network and meet new people and maybe push yourself a little bit outside your normal comfort zone.
When you decided to move forward with the franchise, did you go in eyes wide open understanding what you were getting yourself into?
One of the other selling points in the franchise for Mark was there was a weekly call that he had where they would all talk about different deals that they had that were out there. They also require everybody that goes through and becomes a managing director of a franchise to go and get Sandler training. So, they have to do a two to three-day boot camp. Mark also did some local reinforcement training.
Mark is a high D and a high C in the DISC profile. He's a 78 on both of them, so that means he's very task-oriented. Mark shared that you find out very quickly within the first three months, your blind-spot radar, and you realize what you need to work on. Mark also shared that if he would have had some of the training and tools now two years into this, that he would have had in corporate that his corporate life would have been probably even easier than it was. He has learned so much in the past two years in terms of dealing with different DISC styles and identifying them, and that was a huge part of his learning curve.
What was your biggest struggle when transitioning?
One thing that was difficult for Mark was holding himself accountable. All of a sudden, he needed to break that down into pieces and understand the concrete steps he needed to take between now and two years from now to get to where he wanted to be? When you're leading an organization. All of a sudden, you start second-guessing yourself. If you're in corporate America can defend whatever you do.
When you're running a business, It's different. You don't need to defend what you do to anybody but yourself. Win, lose, or draw, it's on you. There's a lot that's a lot of stuff that, as a small business owner, maybe you might've taken for granted if you were in a bigger company.
Do you run into a lot of people that want to do everything themselves instead of outsourcing to an expert?
Marks hared that the hardest sell for Supporting Strategies is the person who's trying to do everything themselves don't understand that having somebody else do it for you can save you time, money, and headache.
You get to a point where you have to be so focused on a certain task that takes so much of your energy and mental capacity, and for hours, you have to be myopically focused on it, or it's not going to get done.
If you don't take anything else away from this episode, remember this one piece of advice!
Always have segregation between your personal finances and your business finances. Have a separate credit card, separate, and a separate checking account. Period. Never should one touch the other. The main reason being, if you're ever liable for something, it proves that the LLC will actually protect you in a court of law. If you're thinking about starting a company, one of the great local resources you have is WCTC small business center. They a program called Fast Start, where they'll go through everything you need to start a business.
One of the big things that people make a mistake on is making sure that you're appropriately insured. It might be a couple of hundred bucks initially as you're getting things started out, and you'll probably be at their minimums for everything but having that sort of protection in place so that you yourself are not going to end up in a problem spot.
Advice the Mark learned that he wanted to pass on to the listeners
Know your blind spots and understand your emotional intelligence. Understand that not everybody wants to be communicated the same way that you like to communicate.
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