Episode 132: Be Profitablie from the Start with Tess Wicks

Today, our guest is the Best. Her name is Tess and she's gonna grunt along with us when the music starts, so stay tuned for that. Mike.

Oh, I love it. Tess, you better be ready to grind. I was gonna say something different, but it sounded inappropriate. You know what also sounds inappropriate? The fact that you don't have a business psychologist. Christina, every successful business has a coach or an expert or a mentor or board of advisors behind them. And. And the best are business psychologists. Someone that can actually knows how your mind works. Yeah. And that's who I have. I work with Dr. Sabrina Starling. She is a business psychologist. I've worked with her approaching five or six years now, and she's helped elevate Profit first professionals to the levels we are at today. Well, she can do the same for your business folks, so check her out. It's Dr. Sabrina Starling, the business psychologist. She's also the author of how to hire the best. And she's doing something real special just for us. She's putting on a masterclass called quickly double your profit with top performing employees. And she's doing it for free. It took a little bit of negotiation to see normally something she charges for. If you want to sign up for Dr. Sabrina Starling's class, text this word employees to 44222. That's 44222. Text the word employees. And Dr. Sabrina Starling is going to be giving you a free masterclass on quickly doubling your profits and by using top performing employees.

Yes.

Okay.

Hey, Barry, do you agree. Do you agree that entrepreneurs should. And a lot of business people should have a business psychologist. You agree with that, right?

190%.

Okay. That's right.

Well, let's do this.

This is the profit first podcast and.

You are listening to episode 132.

And here's Tess.

Yes. Oh, come on, join us. I didn't hear zinger.

I tried.

Really? All right, we're back.

Welcome to the show, everybody. My name is Chris Curran. I'm the founder of fractal recording and pause your life.

And I'm Mike Michalowicz, the author of Profit first. And let it be known, people, Profit first revised expanded is available in markets February 21st.

Nice.

Which this is coming out before that.

It'll be like a month after this episode comes out.

All right, so preorder it now.

Do it.

Go to Amazon.com right now. Get the brand new version. When I say brand new, I rewrote this thing from scratch. Brand new version of profit first is available there. And you by the Way. You are listening to the Profit first podcast. This is a show where we explore all elements of profitability. The yin, the yang, and everything in between. Trying to make it rhyme.

That's right. And it's the beginning of the year. So look, if you get your ducks in order now, you'll be profitable this year. Get yourself a business psychologist. Get yourself Mike Book. What else, Mike? Well, whatever you can do. Everything. You can hear our show as a podcast anywhere you hear podcasts, any podcatcher, any platform directory, itunes, stitcher, Tune in radio. We have a. A gaggle of episodes behind us. If you want to go binge listen, you can. And you can also rate and review our show, our website. This is where you want to go. This is where all the magic happens. And there's funny pictures of Mike Profit first podcast dot com. Everything's there. That's all you have to do is go there. And I love this show because it is about profit. It's not about revenue. Well, we talk a little bit about revenue, but revenue is fine. But profit is all the time.

Oh, the guy is hot today. I saw you slowly releasing that pitch and I was like, oh, it's straight up to center. I'm just going to hit that soft bomb softball lobber. He sent me a lobber. You know, this is a show where we share. You said a gaggle. I think it's really a bail. We share a bail.

Here we go again.

Profit tips. So, Christina or Chris, without googling, what do you think a bale is spelled? B A L E. A bale. Yeah, it's always a group of something.

Yeah, I'm gonna say bighorn sheep.

Oh, close. Really close. No, not close at all.

The pigs.

I don't know. Yeah, that was even close.

Wait, what did she say?

She said pigs. Oh. So a bale is a group of turtles.

Oh.

Oh, really? Also sometimes referred to as a herd or tertoiuses. I made that one up. Yeah. But sometimes called a herd. But I couldn't imagine a herd because herds stampede. And could you imagine a turtle? Turtle stampede? It's like, what do I hear, cotton balls falling from the sky? That's the pitter patter of a herd. A bale of turtles running towards you at breakneck speed.

I did see one turtle chasing a cat chasing a dog around a pole once on YouTube. Seriously, the dog would go around one side and the turtle would follow it, and then the dog would go around and then come up behind it, and then the turtle would realize that it would turn around and then Follow it the other way. And it just kept happening.

Oh, that's awesome.

That's awesome. So, Chris, what you been up to, my brother?

Oh, just. What would you say optimizing my audio gear and software over the holidays.

What's your favorite thing that you got?

I got some really nice mastering software. I got some really cool plugins that emulate old audio gear. So there's gear that was used in, like, the 60s and 70s that was like, I mean, tremendous sound to this audio gear. And these days, they can actually model those pieces of gear into plugins which are just in your computer. And you could. You could use it just like you used to, but it's in your computer and it just makes everything sound great. So that's my awesome recording engineering passion.

So you bought new gear to make your gear sound like old, shitty gear?

No, no, not old crappy gear. Dude, this is the best stuff. They really. Yeah, no, it's the best stuff. A lot of the microphones are the classics. There's nothing that sounds better than them still to this day. Why? Because they made real shit back then. Now they make crap.

Yeah, but why don't they just make good stuff? And why do you need something like.

That's a good question, Corey. Do you know the answer to that? I have no idea.

I think we have to defer to Barry on this one.

Barry, what do you. When you look at the new audio recording gear that's out there today? What. What do you see and what do you feel?

There's no activity, no giggle, no nothing.

All right, good point. Let's move on. What have you been up to, Mike and Christina?

Dude, I. We hired a new guy. Christina.

We did.

Christian Dipila. Dipila.

Diplo.

Dip.

Did you even meet him yet?

No, we met Christian. He came on a week ago.

Yeah.

And he's our new media guy. Really? For video. So we filmed our first educational video just now. Actually, the second one's being filmed right now with, I think, Brandon.

Brandon the hood.

Robin Hood. Yeah. So, yeah, we're growing here.

Yeah.

Better content. And actually, we plan to broadcast this podcast live at some point.

I actually.

Yeah.

What? Wait, what? What's the new guy's name again?

Christian Depill. Christian. Yeah.

Christian actually wrote online about his experience with you and making videos. And actually, I'm going to have Barry read what. What Christian wrote. Is that okay?

Oh, what do you say?

Okay.

And they were causing up a storm. Profanity is left. Profanity is right. Every second word was a heifer not.

Off to A good start question.

And Christian does not like, swears he's offended by them. Oh, so clearly. Hey, Christina, do we make community shout outs there?

We do. We actually have a question for you, Mike. This comes from Jared Bringhurst. And he says that he read your book, obviously. And he says you say that every quarter to disperse 50% of the profits from the second bank account. However, you don't say what to do with the other 50%. Although in the book I think you said this is to grow the business. If I leave, say $50,000 in there and then next quarter I have added another hundred thousand dollars, do I take 50% of the hundred thousand added or the new balance of the 150,000?

Jared, first of all, don't ask questions when I eat Chinese.

But he stumped you.

So that's a great question. Hold on, let me take a sip of my seltzer.

Yeah, okay.

Okay. This is a good seltzer, by the way.

Is it here?

Here's the deal, Jared. What you do is. That's correct, whatever money has accumulated in your profit account, you take half of it out and half of it stays. The reason that half stays is you start becoming your own bank. The money accumulates. And if there's an emergency or you need to borrow some money, you can potentially rely on this. Now, that's only in an extreme circumstance. You gotta live off your operating expenses. But, you know, things happen. Rainy days do happen. But the second thing is the money that stays in there, as new money flows in, it accumulates. So let's just go through an example. Say there was $1,000 in that profit account. You take out half, that's 500, and you leave half in your profit account. Say next quarter, you add another thousand dollars. Cumulatively now there's. I'm sorry, cumulatively, there's now $1,500 in that profit account. Now you take half that, which is 750. So now 750 stays. 750 comes out as a profit distribution. Say another thousand flows in next quarter. Now it's 1750. You take half of that, which is around, what, $900 or thereabout. So that's how it works. The main reason that profit stays there is that you have a rainy day fund that's accumulating. The second thing is it's a little behavioral trick. You'll notice that we put the same amount of money in each time, $1,000. But the money started to actually, when it was distributed, grow. And this will happen for about six cycles, that it substantially Grows. Where it grows at a noticeable level. So it reinforces your enthusiasm because you see bigger distributions coming out. So couple behavioral tricks. That's how it works. I'm sticking with it. Thank you. Yeah, yeah. Thank you for the one person clapping. All right, well, thanks for asking that question. In a second we're going to give a have a little guest on. Talking about Christine's like, she leaves me hanging. She's like, yeah, spit this one out, McAllister. We're going to talk about how Profit first works with startup businesses. Even businesses don't have revenue yet. Actually, Tess Wicks, who's a private first professional, is going to come in and share how she's been implementing this with her clients. I think you're gonna have some tips and tricks you can take away. But before we do that, I do want to thank our corporate partners who make the show a reality. They are Fund box.

Yeah.

Nextiva.

Yeah.

Receipt bank.

Yeah.

Fundera.

Yeah.

Oh, you want to say oh yeah. Zero.

Yeah.

And pause your life.

Yeah. Oh, yeah.

Yeah. So we're after we share the insights of what you're going to learn today from Tess Wix, we'll tell you a little bit more about those corporate partners as at the very end of the show, you know, Tess is called the back pocket CFO for small business online entrepreneurs. You know why Christina, why is that? Because she worked for one of the big four, big six, one of the biggest. The big ones. She was an actuary. Well, I don't know how many. There's the whatever, whatever. She worked with large companies, Fortune 500 is helping them save money and do all these different things. And then one day she has that moment, says, what the hell am I doing in this world? I'm going to help small entrepreneurs. I'm going to be an entrepreneur myself.

Yeah.

She leaves the big corporate world, much to their dismay, much to our win. She starts her own business and immediately finds out, somewhat ironically, that she is now doing financial consulting. The same stuff she was doing for the big companies, for the small companies. And she's even done it for a couple brand new startups. Like those companies that go from hobby to business.

Yeah, like you.

Like me.

Yeah, like me.

So. Well, we're going to tell you how she does it and what she discovered during that path. Tess, welcome to the show. Hello.

Welcome.

Thank you. I'm so happy to be here.

Cool. Were you grunting in the beginning? Did I hear a little gruntation?

I heard one grunt and then I said, I tried very hard.

You're a One grunt.

Should we do one more? All right, here we go, everybody. Everybody get ready. Ready.

Here we go. All right. All right.

I really wanted to do it. Yeah. Oh, yeah.

Oh, you want to do that?

Give her.

Yeah. Oh, yeah. Do it.

Yeah. Oh, yeah.

Yeah. Oh, yeah.

I just can't get that low.

Yeah.

No.

No one can touch Barry's baritone voice. So, Tess, you worked with a couple firms that were just brand new startups. They didn't have any revenue, and you're saying, hey, guys, you gotta implement profit first. Why would a business that early on ever want to do profit first?

Oh, there are so many reasons. I think the first one is just the idea of running a business in the first place can be scary. And managing any sort of income. Some people are afraid to even start the business because they're like, what am I going to do with that money once it comes in? And profit first just gives you that roadmap to know exactly where the money should be going and how to, you know, prioritize it, how much you should pay yourself, how much should be going on in expenses and whatnot. So just having a roadmap before you're ready to accept those checks can help a lot.

But you said some people are afraid to start a business because they don't know where the money's going. Really? Have you found that people are that afraid of the cash flow? They don't even pursue the business in the first place?

I think that there's a lot of reasons that people get afraid of pursuing the business. But between, yeah, starting to make an income, and then where I see it, even more is growing and getting even more cash flow. Because once more cash comes in, then they think they either need to spend more of it or grow or do make these even bigger decisions that can spiral into almost a paralysis of not thus going forth and creating an income for themselves.

Did you just throw the word thus out? Did I hear it thus?

Yeah.

That was awesome. It's ever been used on this program? Yeah. That's cool. Word is ergo. Ergo.

Ergo.

She uses ergo all the time. Ergo all the time.

I love ergo.

So it's a good word. It's a good word. So a small business, when it comes to profitability, I believe. I believe the general belief is you, you gotta use money to. To grow. It takes money to make money. So profit seems like something that gets kicked down the road. Are you suggesting something different?

Okay, so my least favorite thing that I hear, a lot of small business owners kind of almost you know, touting about is the whole, I've never taken a paycheck. And I call that the entrepreneurial.

They brag about it.

I take. I call that the entrepreneurial martyrdom complex. So it's this idea that, like, they're going to be martyrs to their business and never take a paycheck and just reinvest the money in their business over and over again. And I'm like, wait, how do live?

Yeah, who do they live?

I always used to get so confused by that, and I honestly. Well, you know, they're probably using the money in their business to help them live their lifestyle, but they haven't figured out how that has transitioned. Transitioned into an income for them.

So are they living off of loans and stuff, is that what you're saying?

Well, they could be living off of some personal investments or personal savings or loans, or using their business's money to afford their own lifestyle. So, you know, the car is run through the business, part of their home, office is run through the business. Maybe they have someone else supporting them. But for the most part, it's still the question of how do you live off of this if you've never taken a paycheck?

Yeah, I guess there's a certain point that that money runs out. That if. If you're living off of the business cash flow exclusively and there's no profit, that at a certain point, there's certain things you can't live off the business. Like the business can't pay for my home, I assume, or my apartment. Right.

Yeah.

I mean, that's not even a deductible expense, so I don't understand how they're doing it.

Exactly.

That was a. That was called a throw over. Meaning. Don't just say. Right. You got to say something that makes sense now. For God's sake, Tess.

Yeah. Oh, yeah.

Okay, well, then, all right, let's start over again. What are they. If they're living off of the business cash flow, that actually sounds like a smart strategy, because that's. You want to incur as many expenses as possible, I believe, through the business that pays your expenses to reduce your tax consequence. So it almost sounds smart. But I've also found, Tess, that there's a certain point where they're using credit cards, they're using business loans, and the business loan, maybe they're saying they ought to buy new equipment, but actually gets redirected to pay their own salary. At a certain point, they start accumulating debt. Have you seen that in businesses?

Definitely. And it's. And it's always a confusion between their own personal debt and their business debt because some people are willing to go more into personal debt and then fund their business with some of that money too.

So how do you straighten that out? How do you straighten out the difference? How do you make it very clear what business that is and what personal debt is?

Well, they first need to just start treating their business like a business. So separating everything out and, and figuring out what they're spending on themselves versus what can be run through the business.

All right, so, well, you, you have two clients that were hobby based businesses, right?

Right.

Okay, can you tell me what one of those businesses was?

One of the businesses is a wedding photography business. And so it's been, you know, a side business between a wife and her husband and the husband has gotten a job and so she's wanting to take it from just the side thing that they've been working together so that to a full time thing for herself so she can really start running the business.

So she kicked her husband out. Okay. Then what happened?

And she kicked her husband out. She took on all of the finances. And the interesting part about this is kind of another layer to it is that with weddings in general, it's a seasonal business. So her income, she gets half of her income in the winter, probably right around January or December, and then the other half comes in the summer when the weddings actually take place. So she has trouble managing that cash flow. But she also just had that one checking account and maybe a savings account, but mainly a checking account where everything was being operated out of. So she didn't know really what income was coming in, when to expect the next one, and then how to kind of regulate that income for herself. So she knew what she could live off of versus what she needed to be spending on the business and when those things were going to be going out of the business.

So she did not have predictable income. It was kind of spiky and all over the place. She didn't know what money could flow through to her as a personal income. She didn't know what she could use for expenses. So then what do you do in a case like this? What's the next step?

Well, first was a lot of education, but then educating her on how. I think another thing that a lot of startups and all businesses in general think is it doesn't make sense how it's going to work for their business in particular. And with hers, this gets a little bit into advanced profit first actually, because we needed to set up a drip account for her because she had a huge amount of income coming in in, you know, between November and 1 January and then another big chunk coming in probably between June and the end of July. So we needed to set up that drip account so that it could slowly start dripping up into her income account. So we first.

And how do you, how do you, how do you set that up and explain, because a lot of our listeners may not know what a drip account is. What's the purpose it serves the drip account?

The purpose of it is just to start regulating a monthly income for herself so she can start budgeting for expenses and you know, a regular payment to herself or a regular salary that she might be paying herself on a monthly basis. So the drip account takes all of the income and then it drips it into her profit first income account on a monthly basis. So since we're operating on six months, you know, the first six months she gets the down payment. The next six months she gets the rest of the payment after she's delivered the services. We just take that money and divide it by 6 and then drip it for the next six months into her regular income account for in profit first terms.

Gotcha. So I'm clear here. For example, someone may hire her to do a wedding shoot and she'll say today, maybe the wedding's in the summer. She'll say today, say it's in the winter, give me a deposit for, I don't know, $2,000. And now instead of seeing that as income, you spread that out over six months. So she gets $300 or whatever it is every month coming into her income.

Exactly.

Okay, got it. And what's, you know, she never did this before. When you set up a drip account like that, what was her response? How did it work for her or did it work for her?

I mean, it takes a lot of explaining cause it's just such a different way of how she's operated in the past. But I think it actually provided a lot of relief. And that's what she's said too. After really wrapping her mind around it, finally having a consistent regular income can ease a lot of the stress that she's had in the past. When she says, and I think you'll find this with Seasonal Industries is that they feel really rich in the winter. And then the springtime is just like, where's that money? Where is it going? Where did it come from? How do we get it back?

I call that the recency effect. It is a behavioral phenomena. I know a guy owns a plowing business And I asked him. We had our first snowstorm. Was it three? Three weeks ago. I go, how's business? Like, literally the day after the storm, he's like, it's amazing. He's like, this is the best year I think I've ever, ever had. And now it hasn't snowed since.

Yeah.

And I asked, I ran into him yesterday, and I said, so, how's business going? He's like, ah, it's kind of slow. It's really not doing that well. So it sounds like, Tess, you experienced the same thing, that when a flood of money comes in, people believe to an extreme that business is great. And then when money's not flowing in, they think business is miserable. When the reality is it's kind of somewhere between the two.

Yeah, yeah. And it just. It just takes a different approach to managing your cash flow, to not be so stressed out about money and making kind of irrational decisions when you see a huge sum of money within your bank account.

So now this, this client of yours, she kicks her husband out of the business. She. She loves saying that.

I think he still works for the business, but she's now taking the reign.

And he got a mess.

He likes to create a story.

He's nice like that.

What'd you say, Chris?

He's nice like that. He still helps her out.

Oh, nice. So, okay, so he got demoted. And then you're telling her, you know, you got a brand new business that you're launching here. Are you also telling her to be profitable?

Yeah, of course.

Okay, so of course I get it. I love it. But she must have been like, you're crazy, Tess. What are you smoking? What was her response to requiring profitability in that business from day one?

I think that she was excited about it. It's interesting because I don't think she was so concerned with profitability because she was like, well, what am I gonna do? Money? And I'm like, you're going to take yourself on a vacation. That's what you're going to do.

Nice. Nice.

And you find that with a lot of people who are taking their business from kind of either hobby to full time or they're just starting out, is they believe, they firmly believe that they do not deserve this profitability. And I take the complete opposite approach. Maybe I'm just selfish, but I love to have my business pay me money.

Yeah, of course.

Yeah, I'm into that. But here's the question. A hobby is the definition, at least how I understand. A hobby is. A hobby is something that you do. An Activity you do. Can you stop making faces?

Christine is doing selfies, adding, you and.

Me, you're making faces at me. A hobby is something you do for the joy of doing it. So Christina's hobby is taking selfies. Mine is playing guitar. The activity is a joy. Do you think, Tess, that to some degree your clients say, well, this was a hobby. The activity itself is the joy that I shouldn't be making money. Do they see it that way?

That is a good point. I think when you really enjoy the work you do, you almost feel bad, like making a profit on it. Yeah, but there's so much stuff that you have to do that you don't enjoy when it comes to business. Just running a business, the pure act of going out and, you know, taking wedding photos might be a lot of fun, but doing the day to day grunt work of emailing and, you know, buying flash drives and doing your own bookkeeping, if you're doing it yourself or meeting with someone who can help you with that, all of that stuff is work. It's not part of the fun hobby that you get to practice in the.

And the worst parts, the worst part's dealing with the bridezillas out there.

Right?

This is not to my standard. So. Okay, but then how do you convince, how did you convince her she needs to start taking a profit? Was it by saying vacations? What did you do?

Well, I'm just very convincing. No, I think that profit there's, especially with the profit first system, there's kind of two stems, there's the profitability that you take as a distribution that is yours and you get to go do what you want. The other part is just building that cash flow and having cash in your business for the safety net. And I love what you said in the beginning about becoming your own bank. That's something that I teach personal and business financial in my personal and business finance is that you should always just have that safety net, but then even go beyond that and start planning for funding these expenses that you're going to have in the future. And instead of going and having to put it on a credit card, if she wants to buy a new camera in a couple years, she's going to have that cash in the reserve for her so that she can just use her own money and go buy it and then go back to saving up that cash for the next big purchase. So kind of explaining that to her. But then also, you know, you don't need. You also deserve to be reaping the benefits of the efforts that you're putting into your business, even if it feels like it's a hobby, all of the other hard work that you do on top of it, you deserve to be paid out in a, in a profit distribution if that's what they want to take. I also told her that she could always take that money and start saving it for her kids college or, you know, it's up to her how she uses it, but she needs to use it.

But it's got to be used for a personal benefit, right? Yeah. So you know, one of the keys, Christina, is so many people here by the profit account and then we say you got to celebrate with it. An example could be, as Tess was saying, go on vacation and people are like, I don't want to, I want to save the money in a retirement fund or something. Then they don't feel it's a profit distribution. It absolutely is. Whatever rewards you personally, whatever it gives you joy, that is a profit distribution. One thing you can't do with it is put it back into the business. Yeah. Hey Tess, what about, you know, we tell established businesses on a quarterly basis, let's look at those percentages and adjust them. What are you teaching startup businesses to do with their percentages?

We start pretty small, but some businesses, especially the ones in my kind of market and expertise, have very low expenses. So they can be pretty profitable from the get go. But we definitely adjust on a regular basis because I think that you can always improve and you can always become more innovative with the way that you are, you're operating and especially the ones that want to grow, starting to look at what that's going to take from either hiring someone on or implementing a more expensive process that will get them to become more efficient in the end. I think that business is constantly changing. So whether you're starting from scratch or you're, you know, in the thick of things, you, you need to constantly be adjusting.

Do you see some common mistakes that the startups make? I mean, you've worked with a handful of brand new startups, you've quite a few other clients. Is there some things like, oh my God, startups always, you know, they spend so much on those business cards or logos. What are the things that startups are spending money on and really from your experience are wasting money on? On.

So there's one thing that they're spending too much money on, there's another mistake that they're making that doesn't have to do with how they're spending money, but the first with what they're spending on is a Lot of them spend a ton of money on online courses and continuing education, which I am all for. I'm all for that. But there really does need to be a budget in place and using your 50% saved in your profit account. If you don't want to just plan it in a monthly budget, but you want to start saving up to take this course in the future, I always say use that profit money to take this course because it does give them a little bit of a personal benefit or if it's the cash reserve that they use. But having a plan save for this money instead of just. I think that there's this huge influx of online courses and coaching and all of this stuff that is to help improve your business, which I think is good. But it's being more mindful of what that's going to cost, what the return on investment is going to be, and not, you know, trying to do it all at once. Maybe just do like one a year or once every six months so that you can actually learn something from these courses or coaching sessions, whatever they are, and implement them. And that gets a little more into just like behavior and productivity and efficiency. But that's a big.

I couldn't agree more.

Startups kind of just feel like they need to again, spend money to make money.

Yeah. And I found, you know, these online courses, they're great and, or. But many of them are duplicative. So you watch one from one source, like, oh, I really should do another one. You do the next one and it's the same content from a different voice and then you go to the next one. And I don't think people are really squeezing the juice out of the first one that they got or the second one. It's this constant thirst to, I don't know, find a magic bullet or something. My preference, quite frankly, is to buy a book, possibly Surge by Mike Michalowitz. But you pick a book because all the notes are there. It costs what, 15, 20 bucks? You can get a used copy for a penny.

$5.

$5 use. Yeah. With shipping. And it's all there. So that's interesting. So I think that's a great point is, is maybe you don't get 100% of the education. Maybe get the one course that will give you the 80% is what I'm hearing test. And then, you know, learn as you do. Is that kind of the solution to that problem?

Yeah, yeah, I think just, just actually taking that stuff and taking action on it instead of feeling like if you just continue to buy more Courses, you'll all of a sudden magically have this solution that you've been looking for.

Mm, agreed. And you said there was one other thing or one other challenge wasn't related to money.

The other one. This is what it is, this is specifically for people who are just starting up, is what to do with those initial investments in your business and how to manage that. And that's why I think implementing profit first from the get go is really powerful. Because if you're, whether you're personally investing your own money to start the business or you get a loan or something, then all of a sudden you have this huge chunk of money that is sitting in your account and you feel like you need to spend it all. And so this is one thing that I had to do for myself as well, was open up kind of an investment account. There's an account where I personally funded my business with a chunk of money. But then that money didn't flow into my regular profit first accounts. It didn't flow through. At least I took the money as I needed it for the investments that I knew I needed that money for. Then I could see that investment account deplete as I went, which was really helpful for me in, you know, just not spending it all up front or, or being really frivolous with the, the big chunk of money that I had.

That is a great idea and I've been there myself. I actually, Chris, I had an angel investor put in, I think $80,000 to my company and found ways to spend that money so quickly, so fast. And I wonder if I never got that money, if I've been more prudent and growing the business healthier. Tess, this has been some amazing insights. Where can folks listening in, particularly folks with a brand new startup business, where can they go to get some more info about you?

They can grab the first core chapters of profit first@tess.wix.com creative-profit co it's really long. Hopefully Christina can give you the link to that and then find me on Instagram or Twitter. I am Tesswicks.

And we got one final test for you. Don't look this up on Google. Tess, what's a group of horses called? What's a group of horses?

I should know that.

Why? Are you an equestrian?

No, my aunt and uncle lives.

Oh, she's Italian.

I'm the opposite of Italian.

Really.

Oh, sorry.

So it's funny. So if you were calling, if you really knew what, what I was asking, you would say, well, are you talking about cults? Are you talking about thoroughbreds? Because they're categorized differently. But a group of horses in general is called a team. I bet you've heard that before. Or a Harris. H A R R A s like harassment, but if you were asking cults, it's called Harg Rag. Oh, there. Here comes a rag. That's horrible.

Wow.

A rag of colts or a Harris of just horses.

Mike's got horse on the brain, string. So Mike. Mike rode to work today in a. Riding six white horses. That's what. That's how he got to work.

I wrote in on my harass. Tess. Thank you, Tess. Thanks for joining us today.

Thank you so much.

Thanks, Tess. Great job.

So my little, like, group of animals thing is not nearly as funny as I thought. There's certain things I think of, like this is the. This will. This will bring profit first to a whole new comedic level. I mean, this will engage the audience. It's been. It's been a bomb.

It was okay the first couple times.

Have you done the crows yet?

Oh, a group of crows. Don't. Don't tell me.

Now you're just fueling the fire.

Is that craggle? I want to say crack. What's the word? What do you word you have? Mine's crack. I think it's a craggle. I know. You don't know. What's your guess, Christina?

I'm gonna say crang.

Crang. A crank craggle. What's your guess?

See, I feel like we should change it because crows are so. I know. Bitch is a female.

Bitches.

You wanna call them bitches? All right, what is it, Tess?

It's a murder.

That is right. That is right.

See, after four weeks of doing this. She just trumped you right there, Mike.

Yeah. Oh, there's a but what would. Could you imagine, like, say you're on the streets of. Of some city. We're outside New York. New York. There's a film crew filming, and some guy goes, look over there. It's a murder. Like, all the. All the cameras turn and, like, these crow. Like three crows go walking by.

Oh, the things we discuss.

Tess, that was awesome. You. You win. You win. Just keep your eye on the mailbox for a long time.

Well, thank you for being patient with me too, during the interview.

No, no, you rocked. You rocked. All right, we gotta get out of here, Chris. Well, not out of here, but we got. We gotta.

Yes. We gotta talk about our. We gotta talk about what we learned.

Right.

And then. But. But first.

But first we gotta thank our corporate partners and. And do a couple Other things. So let's first talk about our corporate partners. There's a few people that even an episode that was this convoluted, that I messed up this badly still support us. And they are in no particular order. Yes, nextiva, did you order those phones today? Yes. Yeah, I saw these orders come through.

Kelsey did, actually.

Oh, did she? Did she get the new conference phone? Yeah. Could we get one that's amplified?

I think she asked for it. I don't know what the outcome was.

That's the cool thing I like about nextiva is you don't have to say, I want to order XYZ phone. You call them and say, here's the challenge. We have. We have a big conference room where we're doing training now, and it gets particularly noisy in there, so we need an amplified phone. She was able to call and ask that question. We don't know the result because neither of us were there. But it's cool that you can call a phone company and they make those kind of suggestions. That's what nextiva does for you. And the price of your home phone, it's like the, the, you know, that's where VoiceOver IP is. It's amazing. Then there's a Fundera. I call it the One Stop Shop for Loans, but they're more of an educational source too. You need a loan. Corey, our own podcast engineer called Fundera. Within 24 hours or something, he got her first loan offer. And then I think within another 24 hours that he had 10 or 15 lined up and Fundera hopped on the phone with him and said, let me tell you why certain loans are better for you than others. And then he got an X T, V phone system, I think. Hey, Corey, did you get that nextiva phone system yet? Oh, they celebrate Christmas in Canada. That's a classic. That's a classic joke. Wow. Yeah. That was so stupid. All right, Receipt bank. You know where receipt bank is, Christina?

To track your receipts, but not on your desk.

Where do you. In your phone? That's exactly it.

Take a picture of your receipt, right?

Yeah.

Yep, yep. And you can, you can take indecent photos too. I've noticed it.

Okay.

People used to sit on the Xerox machine. Now you can sit on your next team of phone.

Now that's a write off.

It's a write off. And you get a write off your picture of your butt. And then Fundbox. Oh, you know what Fun Box does, Christina?

They will loan you the money up front if your client's not paying you.

Exactly. Can I say accelerator.

What they are.

Yeah, go for it.

Cash flow accelerator.

Oh, and then there's zero cloud accounting software made on the cloud for the cloud. Cloud, Cloud, cloud. And then certainly not last or it's. I guess it is. Last but not least is pause your life.

Yes.

What's that?

Yeah, Pause your life dot org. Go there, you'll see. It's a secret. Go there, you'll see what it's all about and you'll. That's a great way to pitch a sponsor, huh?

That is a good one. Check out pause your life.

Pause your life.org, right?

Figure it out on your own. You'll love it.

Barry, you like pause your life. Barry, you like pause your life, right? Yeah.

Yeah. Oh, yeah. Oh, yeah. Chris, would you like.

Well, I thought the whole conversation around stress and the psychological effect of. Of not implementing profit first, meaning, like you guys are talking about these businesses that are cyclical and a lot of money will come in and the guy says, oh, my business is great. Three weeks later, he's like, oh, man, it's dragging. My business isn't good. I think that really affects your psyche. And we know how much our psyche affects our attitude and then our action. So, you know, those ups and downs, they actually take a toll on your business. And that's one reason why implementing profit first, or, you know, however much you implement it, it helps just clear your brain and gets that stress off your plate. I mean, starting a business is hard enough, or even running a business is hard enough. You don't need that extra stress. And that's what I love. That's what I love about profit first, the clarity and the stress relief.

I just read an article, and I don't remember where I saw it, but I just read it this week of a test that was done with people. They took three groups of people, 100 in each group. One group was told to write down everything that stressed them out for that day, all the challenges they had. Another group was just told to write down any thoughts that come to mind. And the last group was just to write down the positive aspects of. Of what you experienced that day. They did every day for a full month. At the end of the month, they tested the health vitals for all these people. The people with the negative thoughts had worse health vitals.

Oh, yeah.

Higher blood pressure, less sleep, more. All these different elements they measured. And the people that wrote down positive thoughts better. And the end result is, you know, if this continued, if this experiment continued out, the people who had the stressful thoughts would live Shorter, unhealthier lives. Yeah.

Imagine that.

Yeah. What'd you say?

Imagine that.

Oh, I thought you said like, was not. I'm like, what's a was not. Imagine that. Christine, what do you got for me?

I guess I never realized how important it is to have a drip account, especially for those people or those entrepreneurs who work for a case by case basis and do not have a consistent amount of business coming in. I mean, it's important to be organized with your money and be able to budget yourself. But I guess I never realized how much a drip account can change your life.

Yeah. Isn't that cool? Yeah. Yeah. My big takeaway was hobby to business. As we're talking through this, it's very clear to me that many people have a hobby and think that the joy of the hobby will just perpetuate as the becomes a full time business. And test point out, no, no, there's this whole infrastructure needs to go in behind it. And I think people don't think about that. And then therefore they're not prepared for it and everything goes to pot. So if you're taking a hobby making to a business, there's a lot of infrastructure that needs to go behind it. And I'm thrilled to see that Tess is finding Profit first can and should be implemented from day one to reduce that stress and manage every cool. All right, well, that's what we learned, Chris.

That's right. And we want to. You know, we're really glad you were here and we're really glad that you listened to this podcast. And most of all, we're happy that we are part of your profit journey. So definitely go to profitfirstpodcast.com and you can comment on this post. We want to know what you learned from this episode. Right. You heard what we learned, but you probably learned something even better. So go ahead and comment there. You can even ask a question to Mike or Tess or Christina or OB Ron if you're brave enough. So profitfirstpodcast.com and seriously, we gotta be profitable with our businesses here. And this is, this is what I love about this show. So, Mike, Profit First Professionals. There's a little word with the asterisks around it. I mean, what you guys are doing with Profit First Professionals is amazing. I mean, who, who could have thunk that a business owner could reach out to an accountant or a bookkeeper or a coach and say, can you be my, you know, caped profit advisor? Like my, my profit superhero, Stand behind me and guide me? Seriously, can you believe that?

No. Yes. I can believe it. I don't know. Yes. No. I don't know. Maybe. You know what? Like Tess Wix is a perfect example. Tess is a Profit first professional. She has a serious background working with Fortune 500. She moved into the entrepreneurial space, and she's now the only person with this kind of financial fortitude and background that walks into, in this case, a photographer and says, we got our focus on profitability. We got to stretch out your income so that you start living off of a kind of a normal standard income. But let me tell you something, Lesnar, this is not what a traditional accountant or bookkeeper does. They just say, here's your numbers, here it is, you're fine, you're reconciled. And their voice even sounds a little bit like that. But Tess, she actually looks at your business from a profit perspective and making sure that supporting your lifestyle and that your lifestyle is in sync with your business, she synchronizes it all. Well, that's what Profit First Professionals do. Do you want to be working with Tess?

Absolutely.

You can. All you have to do is go to profitfirstprofessionals.com, click on the find button, we will find you a Profit first Professional. Maybe test is perfectly suited for your business, or maybe you're an industry where we have a better suited person. We'll do the legwork, we'll find the perfect person for you, we'll match him up, and starting with you filling out that form, your business will be more profitable from that day forward because you're now working with a profit first professional. So. So do it.

Now.

Go to proffersprofessionals.com, click on find, and we'll take care of the rest.

There you go. So take these profit principles, and this is the thing about listening to the show. Every week, these profit principles will drip into your brain and you'll have Mike McCallowicz sitting on your shoulder, secretly or subtly guiding you. This is. This is awesome. So thanks for listening, everybody. Thanks to Tess and everyone behind the scenes over there at Profit First Professionals. We'll see you all next week. Until then, peace.

Thank you.

See you later. And be sort of. Join us next week. Episode 133 Jason Spencer's coming on. We're gonna tell you how you can be profitable, even in the entertainment industry. It's not the entertainment you're thinking about, you dirty mind. This is. It's DJs wedding. Entertainers, folks in that industry, you can be profitable. And Jason's gonna tell us how. Don't, Don't. Oh, just in time.

Just in time. All right. It.