LY Podcast: Ep. 53: Get Your Finances Off the Launch Rollercoaster with Parker Stevenson

Melissa Anzman (00:00): This is the Launch Yourself podcast episode number 53 with Parker Stevenson. For more information and show notes, please go to launchyourself.co/53. Welcome to the launch yourself podcast. My name is Melissa Anzman. I'm a bestselling author and the CEO of two businesses, an employee experience company, and launch yourself where I help entrepreneurs diversify and scale their business by launching digital products each week, you'll hear mind blowing interviews, where we peek behind the curtain of other people's launches, as well as actual tips and strategies that you can implement in your daily work-life to create launches that actually make you money. Thanks for spending some time with me today. Now let's get started.

Melissa Anzman (00:48): This episode is so much fun, even if you're not so certain about the topic bookkeeping, I promise you're going to learn a lot from Parker. He is able to break down what I think are, um, difficult financial systems and processes that we need for our business into things that actually make sense. And in this episode, you are going to learn so much about how to get your finances in order, regardless of the stage of business that you're in. So Parker Stevenson is a co-owner and the chief business officer at evolved finance, a bookkeeping agency that specializes in helping online entrepreneurs to build more profitable and financially stable online businesses for over six years, Parker has been advising some of the top coaches course creators, influencers, and thought leaders on how to make more sound business decisions using their financial data. Before joining evolved finance Parker spent five years at Adidas America, where he became the us product manager for golf footwear. And let me tell you friends today, we are going to dive deep into how to get all those things in your financial house created and started as well as when it's time to get some outside help or when you really truly can do it on your own. You ready? Let's dive in. Hey Parker. I am so excited to have you on the show today. Thank you so much for coming,

Parker Stevenson (02:19): Melissa. Thank you for having me.

Melissa Anzman (02:21): So if you could give us a little bit of background about your business and what you do.

Parker Stevenson (02:26): Sure. So I am a co-owner and the chief business officer at a bookkeeping agency called of all finance. Now, if a bookkeeping agency immediately makes your eyes want to roll into the back of your head, because that sounds so boring though. One thing that's a little unique about us is that we specialize in online businesses, which I imagine a lot of people listening have. So my business partner had the, the foresight to, you know, in 2010, be a little lucky to get his first client who she happened to work in the law world and then decided to jump into the world and he kind of followed along and helped her get the, um, figure out how to do the finances properly for an online business, because you're dealing with Stripe, you're dealing with PayPal, you're dealing with all these kind of different systems than a classic business would.

Parker Stevenson (03:11): So Corey kind of helped her to figure it out. And next thing you know, you know, it's 2020 and we have, you know, we're working with some of the biggest and best online entrepreneurs in the, in the business. And so while a lot of bookkeepers focus just on the reporting and the bookkeeping, which is a big part of what we do. Um, the other thing that kind of makes us a little more unique is that we like to coach and advise and guide our clients around what their numbers are telling them. So, uh, online businesses are a specialty and talking numbers is one of my favorite things to do.

Melissa Anzman (03:42): I love it. So, um, I was sharing this with Parker prior to us hitting record, but I'll, I'll share it for the class right now. So I was super excited when we were talking about what they do as their business and who they help and all that fun stuff, mostly because I'm awful at book keeping and accounting. And my dad's an accountant. I just want to like remind everyone of that too. So I am terrible at it. And it's so exciting to find a solution that not only does it, but specializes in this weird space, that is an online business, because it's not the same as a traditional brick and mortar. It has its own unique challenges. I'm sh I'm guessing, right?

Parker Stevenson (04:24): Definitely. No. And you're not like we have a couple of clients whose mom or dad wasn't, it was an accountant. And so they have a little bit of like trauma from them trying to get involved in their businesses and like help them with it. And then we even have a client who is an accountant who just said, I'm done with the accounting stuff. I just want to run my business. Pulleys, just take care of this. So I don't have to worry about it.

Melissa Anzman (04:48): I love it. So with that, I mean, you don't have what we would sort of consider a typical launch, a typical product. But I do think you have so much value add to our listeners here on the launch yourself podcast. So I'd love to like, have you talk about accounting and bookkeeping and finances and money stuff that are course creators that are digital product owners and all that can really benefit from for today's conversation about lawn.

Parker Stevenson (05:20): Sure. And please know, we've seen some of the best in the business go through their launches. We know how, um, a launch looks financially on a profit and loss statement. And so while our business model doesn't launch, you know, I'm happy to talk about some of the things we see our clients do to launch, but to answer your question, I think if, if everyone listening right now is kind of like breaking out in a nervous sweat going like, Oh man, is there, is there some stuff I got, I get like I just haven't been doing. And I, and I know I haven't done and I need to do well. I think one thing I think entrepreneurs in general try to over-complicate finance or they think it's going be more complicated than an actually. And one of the big things that we try to instill in our clients is how can we keep this as simple as possible?

Parker Stevenson (06:04): You know, we're not running multi-billion dollar conglomerates, right? We don't need to deal with the same financial practices that like I came from Adidas, like before I started of all finance, I worked for Adidas. The finance department of Adidas is massive and they have to deal with a lot of really, uh, they have to deal with a lot of complexity types of businesses. Our clients are running where you're, you have courses, you're doing coaching, membership sites, things of that nature. Let's keep it simple and clean. And one of the easiest ways to start is number one, just separating your business and personal finances as much as you possibly can. For some of you, you might be going like, yeah, Parker, I'm already on that. But I know, I mean, we have some clients coming to us where multi six-figure businesses, no one really told them that's what you're supposed to do.

Parker Stevenson (06:48): So they still kind of have some stuff intermingled. So I think one of the big pieces here is let's start to understand that we have two responsibilities. Now we have our personal finances, making sure we got our, our personal money in order, which everyone has to deal with. Right? But as soon as you start a business, you now have this other baby, you need to take care of which is your business's finances. And it's really difficult for you, your accountant, your bookkeeper, anyone who's going to be involved in your business to be able to differentiate between, okay, what's a business transaction versus what's a personal transaction. So even if you don't have like an LLC or an S-corp or a business entity, just open a second checking account deposit, you know, your business deposits go into it. You, if you don't have a business credit card or anything like that, run business expenses through it. So that way, when you look in that bank account, it's only business stuff going on and your personal account is separate. Like that's one of the most key foundational pieces I recommend to everyone, everyone gets started with you. Don't have to wait until your business is big to do it, do it from the very beginning.

Melissa Anzman (07:49): I think that's so helpful. I did not have my finances separated until I was a good six years into my business. And mostly, cause I didn't know how to do it or where to start. Right. So, and it was as easy as you said, I just opened another account and I did open a business account. I didn't have it the second personal. And it is just so much easier now as I scaled my business and now I have several. And so there's, there's more there, but you know, being able to do my own taxes or pay my invoices or request money in a certain way, like has been so much easier just by having that simple, simple fix there. Yeah,

Parker Stevenson (08:30): Absolutely. I mean the more accounts you have, the more everything's mixed together, the harder it is to see what's going on in your business, the harder is to get any insight from your business. And the reality is your number there. There's these financial transactions going on in your business that want to tell you something, they want to show you what's going on in your business, but we can't gain those insights. If we're trying to shift, you know, sift through your like haircuts and oil changes and groceries, right? So it's just a really good foundational piece for every business owner to just pay, let's start treating your business like a business and separate it from your personal life.

Melissa Anzman (09:01): How would you advise? Okay. Here's what I see a lot of times, and I'm saying this because it's happened to me too. So I see people who are still on the launch rollercoaster, which I can talk about for hours, how that's not a good idea, but we all start somewhere. So most of us start on the launch rollercoaster, meaning that we're getting all or most of our income during these, you know, big launches that we're doing and we have little money to float in between. So with that in mind, like how would you advise people to manage that aspect of their money? Like, do you plan for it as a certain way to plan for it? Like what advice would you have around that?

Parker Stevenson (09:41): So I know our clients are all trying to get out of launching as little as possible as well. I know that there can be a lot of stress around, um, the online launch model in general, but the reality is launches. Even our biggest clients still we'll do a couple of launches or promotions throughout the year, even if they have some recurring revenue going on. So I just want everyone to know that, that, um, there's still a little bit, there's always going to be fluctuations in our business. Like none of our clients just have going to make the same amount of money every month and it's consistent and I don't have to worry about it. Like that's just part of businesses. There's going to be some fluctuations, but there's a, there's a couple of things that we advise our clients to do to kind of make the launch model a little easier. Um, part of that is just getting ahead of your launches. I, again, I'm not personally against launches. I'm what I don't like is launching at the last second because you need money. Like you're like, Oh, I ran out of money and now we need to launch. I imagine you've seen that a little bit

Melissa Anzman (10:36): All the time. And you know, my whole point on that is you're not going to have a successful launch. Like you're not even going to bring in the money you need to, when you do that. So it's not helping you on any front, but yeah, I like that plan.

Parker Stevenson (10:48): Yeah. Having some sort of launch calendar. So we're being strategic about when we're launching throughout the year. So that way, um, we can maybe not have to scramble or panic, you know, throughout the year, wondering when money's going to win, when he's going to happen, we can be ready operationally to prepare for launches in advance. So we're not doing things in the last second, but I think when you start to plan your launch calendar out for the next six months, 12 months, however far out you want to do it, then it's also, well, what's our forecast. Like how much money do we think we're going to generate for those launches? Like, uh, and maybe if it's your first launch, you're taking a shot in the dark and you gotta do a little bit of math and figure out, okay, my list is that, you know, got X amount of people on my list and I can convert X amount of, you know, you start to start to do some digging into what you think it's going to look like.

Parker Stevenson (11:35): But if you've, you know, it's not your first rodeo and you've done a few launches, we'll then great. We have a starting point to start to go, okay, for this next launch, I think I'm going to do X amount of dollars. And then the other launch for this offer, I think we're gonna do X amount of dollars. So you can start to plan out for the year. Like if all goes, well, I'm going to make X amount of money, right? I'm going, am I going to generate X amount of revenue? So if we can then combine that with understanding what we're spending on average in your business every month, that is pretty easy to see how much money we're going to have leftover. And that's essentially just called forecasting and budgeting. So I do think when we have this big,

Melissa Anzman (12:08): Yeah, that's just forecasting and budgeting, like the bane of my existence, but continuing,

Parker Stevenson (12:12): Oh, it's the best though. Cause there's nothing makes this feel more tangible, right? When you go, Oh, like, cause there is something I think where as business owners, your business starts to be something that you just react to, right? It's almost like the business takes this life of its own and it starts to run you more than you start to run it. And I think one of the best ways to get ahead of that is to, to again, start to think about when is the money going to be coming in? How much money am I pushing to try? Cause forecasting it to me, it goes beyond like finance, it's a sales tool. If you talk to the best salespeople in the world, they're not just going to their sales managers and going, I'm going to sell as much as I can boss. Like it's like, they're going to have a very clear, um, sales goal that they want him to hit.

Parker Stevenson (12:57): Maybe it's 10% over what they did last year. And it's like, okay, let's put together a plan to figure out how are we going to hit that number? And when you start to create these tangible goals for your business via the form of forecasting, all of a sudden you start to think a little bit differently about how you're going to reach those goals. It becomes tangible. And I think that's a big part of being an entrepreneur, especially in the early stages is how do we make the business feel less nebulous and spread all over the place and start to get focused. Um, and, and again, intentional, and, and I think those forecasts can be really huge. So if all we have to do is then go well, even if you're just doing a basic budget of going and spending about on average X amount of dollars a month, well now we can start to plan ahead and start to think about, well, how much money am I going to have after this launch? And just doing a little math. It's not hard math. It's just, most of us want to avoid it cause it feels scary, but it's just a little preparation in a spread.

Melissa Anzman (13:49): I love it. Okay. So I want to ask for people in very specific scenarios, what you know, they should focus on. So I know that when new businesses start and they are still in the five figure Mark or trying to hit their first six figures, or maybe even just at hitting their first six figures, money can be really tight and scary. And it is one of those things that you kind of are just taking money when it's available or hoping money's going to come in or not tracking your finances. I'm not sharing any of this from any personal experience or anything. But, um, I'm trying to think of the complaints I got from my dad or, you know, the first year he looked at my business finance stuff. So with that in mind, if you are at that point, if you are, you know, a five figure business owner just at your first six figures, and you're just feel like things are scarce and you don't know where to start, where do we start from a financial, either tracking forecasting? Obviously we would add that in, in budgeting, but like what should we prioritize top of mind at that level?

Parker Stevenson (14:57): Yeah. I mean, this is the importance of bookkeeping and what we do, right? We need a scorecard. Um, a lot of the times, and this is something we talk about in a, in a workshop that we have on our website that not to self promote, but I go deeper into this concept. If anyone wants to, we can talk about at the end, if anyone wants to dive deeper into what I'm talking about here. But essentially there's two games that we look at our client's playing. It's do no to play game number one of generating revenue, sales and marketing, essentially like, can you find your clients or your customers? Can you turn them into paying customers and actually get them to invest with you? And that becomes kind of our world. Where's our net, where's our leads coming from, how do I get better at converting them?

Parker Stevenson (15:35): And then what happens is the second thing kicks in and usually you start to feel it once you get into the high five figure range, low six figure range, where you go, Oh, I have money. I have to manage, I have cashflow, I have to manage. And so what happens is just making money is no longer enough, right? There might be some people who are just like, Oh, I just want like to make some money. I just want to finally make my first $10,000 a month or something along those lines. But eventually you hit that goal and it's like, well, how much of that do you have left over? Like, are you making money profitably? Are you managing your expenses relative to your revenue so that there is something leftover? And there is a certain phase, especially when you're in the five figure range where it's just going to be tight.

Parker Stevenson (16:16): Like, unless you go from nothing to like $250,000, you're going to have this period where things are going to feel tight. And that's where I think it's important that as you get closer to that six figure range, we have some sort of financial tracking to give you feedback on how much money are we spending in the business to make the revenue you're making. So for instance, if you had your first $150,000 a year, but you had to spend $125,000 in Facebook ads, there's never going to be enough money left over, but if you're not paying attention to what those numbers are telling you, and you're aware of how much you're spending on Facebook, or maybe you have a more of a service-based model or coaching model where you made $150 and you spent $90,000 on, on, on contractors in your business. Like we need this information so we can figure out like, where do I need to make adjustments to how I run this business and how this business operates or to my pricing so that I can make sure I'm building a profitable business from the very start.

Parker Stevenson (17:13): And at the end of the day, there is a certain amount of our personal finances that are always going to be connected to our business. So for instance, we have some clients who have come to us where they had big law careers and they left their law careers to become entrepreneurs. And so maybe they were making a ton of money as lawyers, and now they have a six-figure business, but the profit leftover is not enough to, to give them that same salary. They had at least not yet from their law businesses. So for them, the only solution they have is like, they can't spend money personally, like they did when they were lawyers making maybe a high six figure incomes or something like that. Right. So we also have to understand that there, especially when your business is getting going, we might have to tighten the personal purse strings a little bit and give ourselves room to keep some money in the business so we can invest back into it and get the business to a healthy place where you can start to pay yourself. Um, maybe what you're hoping to get paid from your business while being responsible and keeping the business cash flow positive. Does that make sense?

Melissa Anzman (18:12): Totally makes sense. And I have a question with that and, um, this is a personal question, so, you know, um, but so do you recommend all online business owners to set themselves up on like a point payroll, like as, as in, you know, you, here's your salary that you're going to earn and then you take that out of what you're earning. Like do you think getting that set up as soon as possible is a good idea, not top of priority. Like what are your thoughts on that?

Parker Stevenson (18:40): Yeah, I think when our clients come to us, the, you know, all of our clients have hit the six figure Mark or beyond. I mean, we have clients that have made their first a hundred, 150,000. We have clients who are in the 10 million range, right. So that does seem like a pretty wide, um, revenue range. But there is something about once you get to that six figure, Mark, that there is, I think, more opportunity there to start to create a more consistent income, just because the money's a little coming in a little more regularly. And typically for our clients, if they're in that a hundred to 250,000 range, usually it's just the business owner. They're doing a lot on their own. So there is some money leftover, but what we advise our clients on is we want to set up a monthly salary. That doesn't mean it has to run through payroll. I don't want to get too deep into the accounting and tax side of this because I'm not

Melissa Anzman (19:23): Well and I'll glaze over,

Parker Stevenson (19:25): But there's a reason we would run payroll. It's more for tax purposes. You would want to talk to your accountant if

Melissa Anzman (19:31): I just mean more like here's what I'm making, here's what I write from a salary. So setting that up as early as you as feasible is a good idea, just to at least aim for it. Or,

Parker Stevenson (19:40): I mean, I think once again, if you're making $50,000, like you had a $50,000 a year and you had, let's say 40,000 in profit, you know, you had about 10,000. If you need $40,000 to live and pay your bills, guess what? You're taking every dollar of profit out of the business. Like, you don't really have a choice, right? And, but if you made $40,000 in profit, but you can live off of your spouse's income and you don't need that 40,000, you can use that to grow the business that you, you have to know your situation and what your, you know, what your, you can kind of do. You have to make some judgment calls there. But yes, I do think eventually even if it's a couple grand a month start to get a consistent income going. Cause what I don't like is when you have a big launch and then the business owner just takes a huge chunk of money out. And then you're like, Oh, I don't have enough money leftover to hold you on for the next couple of months until we do a promotion.

Melissa Anzman (20:36): So it's just about being intentional and doing some planning and like actual budgeting, both sides what's going in, what's going out and having a plan.

Parker Stevenson (20:44): Totally. Totally. Okay. At what point

Melissa Anzman (20:48): Is it critical for an online business owner to get some outside help? Like, I, I am truly a believer that you don't, you can't be an expert in everything. And so when it's time to hire outside of your wheelhouse, let's get it out as quickly as possible. So for people who, you know, aren't bookkeepers, everyone else is not a bookkeeper. You're either a bookkeeper or you're not, let's be clear if you are not a bookkeeper, a what point in your online business, does it make sense to start looking at bookkeeping services?

Parker Stevenson (21:24): Yeah, I think once you start to get to that six figure range, you're starting to, it's like it gets a little more real. You have a little more to lose. Um, taxes can get a little more, um, scary. And I think also just that's when that financial data starts to become really valuable for you. Right. Um, if you're, you know, up until then, uh, what I advise a lot of smaller businesses or new entrepreneurs, like even to just keep track of stuff in a spreadsheet to begin with, don't try to go out and use QuickBooks or zero. Like again, like you said, Melissa, you're the bookkeeper you're not. And the biggest, like nightmare situations we've seen for entrepreneurs is when they try to do it themselves, or they had some like a family member or friend tried to do the books for them. And it just turns into a hot mess.

Parker Stevenson (22:09): So, but as you get closer to that six figure range, there's going to be some really more affordable bookkeepers out there. Like if you want to find a budget bookkeeper, are they going to do a perfect job? Probably not, but it's better than you trying to do it. And then as you know, again, um, your business gets bigger than having someone who understands your business model. Like, you know, at Volvo finance, we understand online businesses. That's where, um, it becomes a little more of an insurance policy to make sure that your numbers are, you know, 100% correct. So your accountant can be real happy with them.

Melissa Anzman (22:42): I love it. Okay. So I want some good advice. I mean, you've shared a lot of good advice, but I want some more targeted advice before we wrap up, which is every online business owner. So all the course creators, all the digital product, people who are listening to this, all the coaches and consultants, what are the top? You know, I, I'm going to say a number. It could be more or less. What are the top three could be five, could be one thing that we need to like urgently stop listening to this podcast when it's over and start tracking right now.

Parker Stevenson (23:17): So the, the, the number that's, I mean, it's it just the metric for online businesses as profit. We have to know what our profit is. Okay. So for our clients, even our clients with multi seven figure businesses, they will very likely, never be able to sell their businesses. And I, and I think for some people to go, Oh, that sounds awful. It's not, it's great. Like if you, you know, your, your business, um, and again, I go into it with our, a little more deeply about this, but ultimately if the, if you're building a business, that's revolving around you as the brand or you as the service or you as the expert, that's fine, but it's not going to make your business very sellable. So there's never going to be this big buyout one day. You're not, you know, we're not building Uber or Facebook or something like that, where you turn into a millionaire or billionaire overnight, when you sell that thing or you go public.

Parker Stevenson (24:10): So for the types of businesses, we're running their cash machines. Essentially. We want to treat them like businesses, but the whole way, the way we build our wealth from our businesses, it's through profit. And the way that you build a profitable business is by paying attention to how much money you're spending in your business relative to the amount of money you bring in. Right? Like for me, I would rather have a half a million dollar business that profits $250,000 than a million dollar a year business that profits $250,000 because the million dollar business is going to be way more stressful and way more of a pain in the butt to run. And I'm making the same amount of money as I would if I had a half a million dollar a year business. Right.

Melissa Anzman (24:52): Let me, yeah. Let me clarify something for those of us who, um, may need a little extra help, which is profit. The definition of profit is what you bring in from your sales minus your expenses. Is that about right? Okay. Exactly. And what's left over is what's the profit. So you could have a surplus which would be positive profit, and then you can have what's the other side of that when you [inaudible].

Parker Stevenson (25:19): Yeah. And then you can say, you go into the red, it's a negative.

Melissa Anzman (25:22): So, all right. So track your profit. So which means your, you need to track your actual sales, like legitimately track them and accurately track your expenses.

Parker Stevenson (25:35): I mean, that's, it it's really that simple. Now the actual bookkeeping aspect of that is not simple, but the concepts of understanding financially, how your business works, it's literally that easy. It's just, you need someone organizing all that financial data in your business in a way that actually makes sense for your business model. And that's where I think some of our clients, they come to us and after we kind of do the first month of book, keeping they go, Oh, why was I so scared of this? This isn't that hard. And a lot of the times, most of the time, they're like, Oh, my business is more profitable than I thought it would be. And they get a Pat on the back and, and feel better about their businesses than they originally thought. But that's where it comes down to what we talked about in the, in the beginning, you know, we're, we don't have to have these complicated financial, uh, you know, formulas and complicated financial concepts going on our business make more money than you're spending. And you're going to be in really good shape.

Melissa Anzman (26:27): I love it. I love it. It's is simple. When you think about it, I think it's hard when you don't know where to start or when you have a six figure business more plus, and you haven't been doing it because then you do have to like actually have, have bookkeeping help. I think, as you're growing, until you hit about six figures, managing what you're bringing in, at least on paper to hand over to someone to do it for your taxes or all that other fun stuff. Um, and your expenses isn't terribly difficult, but when you do start making real money and to me, real money, six figures, um, it's, it's hard once you hit that point to do it all yourself when you're not an expert.

Parker Stevenson (27:08): Yeah. There's a lot more transactions going through your business. There's a lot more things to keep track of. And I don't think it's realistic for anybody to just like, think, Oh, I'll keep it in my head and everything will be okay.

Melissa Anzman (27:19): That was me like years. One and two. Yeah. I don't do that anymore. Don't worry. Anyone. Okay. So Parker, this has been so interesting and really helpful for me. So hopefully it's helped a lot of other people as well. Actually I know it has. Where can people find you online?

Parker Stevenson (27:38): Yeah, like I said, a vole finance.com is the easiest place to start. It'll send you to our podcast, to social media. And we have a, like I said, we have a workshop on our website that if you go scroll down to the bottom of the page, it's sign up for the workshop. And we actually give away for free a personal budgeting tool and a business forecast and budgeting tool like we discussed. So if you're like, Oh, I feel like I should do a forecast and budget, but I don't know where to start. I do all the heavy lifting for you. I give you the spreadsheet. All you gotta do is plug in your numbers and it'll do its magic for you.

Melissa Anzman (28:09): We all know what I'm doing right after this. So I will be sure to include all those links, including the awesome, uh, tools that you've mentioned in the workshop, in the show notes, Parker, it has been so fun having you on today. Thank you so much, Melissa.

Parker Stevenson (28:25): Thank you for having me. It's my pleasure.

Melissa Anzman (28:27): To join the free Launch Yourself workshop, where you'll learn, why your digital products aren't selling nearly as much as you plan for and how to diversify and scale your income by launching the right way to go, go to: LaunchYourself.co/join.