Use Your Finances to Make Better Business Decisions with Evolved Finance

Analyzing Your Business Finances with Corey Whitaker & Parker Stevenson from Evolved Finance on Profit. Power. Pursuit. with Tara Gentile

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I think in order to run a stable business is you just have to be ready to make sometimes sacrifices on your own payroll if you need to build that buffer or if you need to cover maybe a larger expense one month versus another.

— Parker Stevenson, Evolved Finance

Tara:  Welcome to Profit. Power. Pursuit.  I’m your host, Tara Gentile, and together with my friends at CreativeLive, we talk to powerhouse small business owners about the nitty gritty details of running their business, making money, and pursuing what’s most important to them.  Each week, I deep dive with a thriving entrepreneur on topics like time management, team building, marketing, business models, and mindset.  Our goal each week is to expose you to something new that you can immediately apply to growing your own business.

My guests this week are Corey Whitaker and Parker Stevenson from Evolved Finance.  Evolved Finance is a bookkeeping firm and small business consultancy that specializes in online businesses, ranging from personal coaches and affiliate marketers to lawyers and bloggers.  These are actually the guys I trust with my own business’s finances.  Instead of asking for financial advice, I wanted to turn the tables and find out how they use financial reports and tracking in their own business to project cash flow, make hiring decisions, and plan for the future.  I talk with Corey and Parker about the schedule they use to review their own books, the exact reports they use to track the numbers, and how they set financial goals.

Corey Whitaker and Parker Stevenson, welcome to Profit. Power. Pursuit.  Thank you so much for joining me.

Corey Whitaker:  Yeah, thanks for having us.

Parker Stevenson:  Yeah, thank you.

Tara:  Absolutely.  So you guys run a bookkeeping and small business consultancy that specializes in online businesses, like many of our listeners own.  Kind of an unusual specialty, which I love, and as I mentioned to you earlier, I’d really like to take this discussion kind of meta, and find out how you guys track your own finances, and how that really affects the decisions that you make in your business.  But before we get into that, can you guys tell me how you got into bookkeeping and consulting to begin with?

Corey:  Yeah, sure, so this is … this is Corey, so you guys don’t confuse our voices.  About ten years ago, I started working for a successful lawyer, Alexis Neeley.  Tara, you actually know her.

Tara:  Mmhmm.

Corey:  And I was working as her personal assistant, or that’s what I was hired to do.  During that time that I was working for her, I was attending college, and as a requirement for my degree, I had to … I had to take a few accounting courses, and I realized during that time that I loved numbers, but actually, quite frankly, I hated accounting.  I loved learning about how businesses made money and how they spent them and everything that goes along with that, but I definitely was not interested in accounting.  So around that time, the crash of 2007-2008 happened, and my boss, Alexis, she needed to consolidate her payroll.  She was looking to cut expenses.  And I had already expressed to her some interest in working with her in the numbers area of her business, and getting to know that a little bit more intimately, and so she decided that I was going to be her bookkeeper.  Which is crazy, because I had … I had no experience bookkeeping when she decided that at all.  She actually, I guess she just believed in me, I don’t know, and she paid her then current bookkeeper to train me to do bookkeeping, and then she let her old bookkeeper go.  And then I also befriended in the process her accountant.  So I sort of just got thrown into the fire and started just trying to learn everything I could about bookkeeping, even about accounting, talking to her accountant quite a bit, spending tons of time with Alexis herself, and learning everything that she knew about her numbers. 

And then about, I don’t know, maybe six months later, seven months later, she started getting involved more in the entrepreneur world.  Things like digital marketing and affiliate marketing and all that kind of stuff, and she realized, I think she … I guess … I think she realized my potential, and she started to meet people in the entrepreneur world, and then started to refer them to me to work with me.  So flash forward about eight years, and here we are now.  It obviously has been quite an evolution since I started eight years ago, but it really is pretty remarkable.  Ten years ago, if you’d asked me that I … if you told me that I would be working as a bookkeeper and own a big business as big as Evolved Finance is, I would tell you you were crazy and that I couldn’t do that, but here we are.  So that’s sort of in a nutshell how things kind of got started.

Tara:  I love that.  I feel the same way, too.  If you told me eight years ago what I’d be doing now, and besides my business, I would be shocked and dismayed.  So can you guys …

Corey:  Yeah.

Tara:  Can you guys both kind of talk about what roles you each play in the business?

Corey:  Yeah, yeah, for sure.  I’ll start.  I … I am like the operations guy.  I know everything about how to do bookkeeping.  I know everything about how the business runs, and Parker is really, really good at sales and marketing.  I am not so great at that.  So Parker can … Parker can talk a little bit about that if he wants to, I don’t know.

Parker:  Well, no, yeah, I think that’s … I mean, Corey’s been doing this so long, he knows the bookkeeping side of things and the operations side, and that’s really where he … we have two other bookkeepers.  Corey is working closely with them, because they work out of the same office together.  I work remotely in San Diego, so I’m not part of the party every day in the office, but when Corey and I were talking about bringing me in the business, and he was telling me about the business, I was just kind of blown away by the niche he’s kind of developed and how appreciative his clients were of what he did, so I felt like there was an opportunity to grow the business and take on more clients and potentially create some digital products and grow the revenue streams, so that’s where I got involved.  I’ve learned how to do the bookkeeping side of things.  Corey’s taught me way more about finance than I ever thought I’d know, and it allows me to support our clients in a really great way as well, but while Corey is managing the business and using all his extra time to make sure the business is running well, I’m using all the extra time when I’m not with … talking with our clients or servicing our clients, we’re working on our new online course that we’re launching in October, and working on developing our website and just overall developing our brand and developing our sales and marketing strategies overall.

Tara:  All right.  Fantastic.  And Parker, I’m not actually sure that I know the answer to this question, even though I feel like I know you guys pretty well, but how exactly did you get started with Evolved Finance in the first place?

Parker:  Well, it’s interesting, because I think, you know, with Corey’s story, he kind of had an opportunity in front of him, and so he jumped on it, and that’s Evolved Finance, and I think for me, you know, Corey is actually known, Corey and his wife have known my wife for years.  They grew up together in L.A., essentially, and so Corey has kind of been a part of my life for a long time, and I was in the corporate world and Corey was, you know, running his own business, and Corey, I think, at one point was going, “Man, maybe it would be fun to go work at a company, and not run, you know, my own business,” and I was like Corey, are you crazy?  You’re insane.  Like, stay with the business, man, you can control, you know, your schedule, you can control how much money you make, blah, blah, blah, and so we just got to talking.  So that’s kind of how I got involved in the business.  It’s just we were friends, we were hanging out, we both loved business.  I was interested in what Corey was doing and where the business was going, and again, it’s one of those things where if you had told me three years ago that Corey and I would be running a business together, I would not have believed that myself.

Tara:  Awesome.  And I love that you guys shared that you have such complimentary skills.  You don’t have matching skills, you have complimentary skills, and I think a lot of people when they think about business relationships are not necessarily taking that into account, and I think it’s really, really important.

Parker:  It is.  It is really important, and just to touch on that is I think that’s one of the reasons why Corey and I wanted to work together, is we had spent so much time together, and I was actually a musician when I was younger, and I was in a band, and I was playing in a band with the same guys for, gosh, seven, eight years, so I know how difficult it can be to work with somebody even if you are friends, and I think that’s the one thing Corey and I realized is that because we had complimentary skillsets, it’s made working together like almost scary easy.  Sometimes, it’s almost too good to be true.

Tara:  Oh, that’s so good to hear.

Parker:  Yeah.

Tara:  Yeah, so let’s get into that, the nitty gritty of how you guys handle your finances.  So first, let’s talk about schedule.  What kind of schedule do you have in place for reviewing your finances, the business’s finances, internally?

Corey:  Yeah, so Parker and I, we review our financial reports once a month at the minimum, and if something comes up that needs both of our attention, I’ll ping Parker, or you know, we’ll get on the phone and talk.  But I’m pretty proactive without Parker.  I’m constantly looking at our numbers and thinking about our goals, and what sort of … what we want, where we want to be kind of stuff, and Parker’s a really good … He helps me.  Since we’re obviously consistent with that monthly call, but I obviously, throughout the month, I have random thoughts that come across my mind that I’m like, “Hey, Parker, what do you think about this?  What do you think about that?”  So I think the schedule is pretty, you know, it’s once a month, but it really is we talk all the time.

Parker:  And we do … we do schedule it for the first week of the month.  Corey will typically make sure the books are done the first week of the month so that way, we can take a look.  Now, with our business, because we are a service-based business right now, a big part of that, you know, is just, you know, making sure the clients have all paid.  They’re, like Corey said, he’s proactive with a lot of stuff, so there isn’t … there’s not a lot of, like, sales revenue conversation or anything like do we have to have a new promotion or anything like that, because, you know, it’s a fairly steady business, but it is, regardless, still a really good opportunity for us to see what’s actually going on, and see if there’s anything we need to do to change the numbers we’re seeing on the P&L.

Tara:  Fantastic.  Okay.  So you mentioned the P&L.  That’s what the next question is.  Can you tell me what reports you’re actually looking at?  Because you know, my clients hear from me, well, track your numbers, look at your numbers, watch your numbers, use your numbers, and we rarely talk about what that actually means.  So can you talk about the different reports that you guys are looking at, how you kind of parse them out, and yeah, just how you start using those reports in your business?

Corey:  Yeah, yeah, for sure.  So we … I review every month with Parker the … sort of the foundation of our call that we have is to go over the profit and loss statement, and actually, in fact, all of our clients, that’s the foundation of our call, and then conversations come from that.  That, you know, kind of sort of brings up other things that happen in the business and all that jazz, and then we also … we have … a lot of our income is reoccurring, and so we have to talk about accounts receivable, so we review the accounts receivable report.  We also have a cash projection spreadsheet, which goes out for 60 days, and it basically shows us the ins and outs of our cash on a daily basis to see, you know, if we’re ever going to have a cash crunch.  And then we’re also looking at our budget.  We’ve built a budget that we basically use to do … to incorporate our projections and then we look at it for variance purposes.

Parker:  And to set goals, too.

Corey:  Yeah, and to set goals.  Exactly.  And I … sometimes, I randomly will create reports from these conversations that we have on a monthly basis that sort of help us, guide us, and things like looking at our client attrition, how efficient is our labor, how profitable is Parker, how profitable am I, how profitable is my wife, who is also an account manager.  So that’s really … the core, though, is really the monthly P&L, accounts receivable, and then the cash projections.  So that’s … that’s more or less what we’re looking at.

Tara:  Perfect.

Parker:  And what I will … what I will say is Corey is an advanced report creator.  He’s kind of … he has a … just because of the nature of what we do, he has more skillsets than I’d say probably most of the people who are listening would have in the financial realm, but the P&L is a really, really easy report to put together if you are doing your bookkeeping, and we could still have really, really good conversations every month just with the P&L, but because we’re both numbers nerds, we do get into it a little deeper probably than most businesses do.

Tara:  Yeah.

Corey:  Yeah.

Tara:  Totally.  So let’s actually go a little deeper on the P&L specifically, because I think people hear it, maybe they hear, ah, corporate job, maybe they hear, ooh, scary.  Can you tell me exactly what a profit and loss report is and what you’re looking for when you’re looking at it?

Corey:  Yeah, profit and loss statement really is … it’s really quite simple.  It shows your income, how much money you made, and shows your expenses, how much money you spent, and then at the end, it shows you how much profit you made, after expenses.  So income minus expenses equals profit, and when we … when we look at our P&L, the number one thing I think we’re looking at is really the profitability.  I like to look at it on a, like a monthly basis for however long we’re into the year.  So we might look at six months of profit by month, and just see how things are fluctuating, and the things that we look for as well are like expenses that might be more than normal, although our business, like Parker said earlier, it’s really quite structured.  There’s not a whole lot of fluctuation in our spending.  Our main expense is payroll, so we don’t have huge fluctuations in marketing, for example, but that might be something you want to look at is, you know, why is marketing so much higher this month?  What’s going on there?  You know, is there some ROI that we need to be looking at.  Return on Investment.  So that’s more or less what we’re looking for on our specific P&L, though.  And Parker, is there anything else that … anything else you think …

Parker:  Yeah, I mean, the P&L side of things for us, even though our revenue should be really consistent because we have X amount of clients, those clients pay us on a monthly basis, but anyone who invoices their clients for a living knows that it’s not always that simple, so a big part of it is for us to see was one month did we have less revenue because a couple clients paid us late and it went into the next month?  And then did that next month end up being a lot higher from a revenue standpoint just because of the way people were paying us?  Or sometimes, we might have a new client that comes on, and we have to do some back work for them, we have to catch them up for the year, so that’s an influx of cash for us that we also try to take into consideration and try to track on our P&L so we can see, all right, how much money are we making from reoccurring revenue from just building our regular clients versus where are we getting opportunities to get some influxes of cash because of back work projects, which again, it’s just catching up people who are getting started with us in the middle or at the end of the year, and they need to get all, you know, their books caught up. 

So that’s really what we’re looking at from a revenue standpoint, and then when it comes to expenses like Corey said, our expenses are fairly consistent, because it’s our labor and it’s our software, but you know, there’s inevitably things that are going to pop up.  You know, sometimes we, like microphones for this podcast, or you know, getting, like recently, we just purchased stand up desks for two of our employees.  So there’s things like that that we’re also kind of talking about, going all right, we have money, you know, in the bank, you know, can we cover a cost if we need to, and it’s just these little conversations that sound totally boring as I explain it to you, Tara, but you know, when you’re running your own business, these things are important, and I think for a lot of businesses, it’s just too easy to just see money in the bank account, and just kind of spend it, because it’s just easier to do that, but I will say is I think the reason the business has stayed so stable for so long is because Corey has paid attention to this far before I ever got involved in the business, so there’s very rarely any surprises.  As with any business, sometimes, you lose clients, sometimes you have unexpected expenses.  That’s just the nature of the game, but because we’re looking every month and we’re doing some forecasting ahead, there’s never really any situation that’s going to come across … come across as that we’re not going to be prepared for or aren’t going to be able to handle.

Corey:  Yeah.

Parker:  Aside from all of our clients leaving us at the same time, which is everybody’s nightmare, but we don’t really plan on that happening.

Corey:  We don’t think about that.

Tara:  No, no, no, no.

Corey:  And then one thing I forgot to add that’s really actually quite important that we do is every month we look at the P&L, look at the profit, and then we set aside a certain amount of money for taxes.  We take basically a percentage of our profit, and that gets pushed into our tax savings account for when we go to pay our quarterlies, and so that’s sitting there, ready to go, stipend set aside and not even worrying about it.

Tara:  Perfect.  I’m glad you mentioned that, because that is something that we sometimes all forget to do.

Corey:  Yeah.

Tara:  Or forget the importance of, and that creates problems later on down the line.  All right, I’d also love to hear about how you guys do your cash projections as well, because I think while it might be something that is perhaps a little bit more advanced or takes a little bit more of a financial skillset, I think it’s probably something our listeners are going to be really intrigued by.  How do you know, or how do you have an idea of how much cash you can expect to be coming in at any given time?

Corey:  Yeah, so again, with our business, it’s pretty straightforward, because we have a set amount of billing every month that we can rely on, for businesses that have huge influxes of cash, it’s a little bit more difficult, but definitely still possible, so we use a … I mentioned it earlier, we use a 60-day cash projection that basically shows the ins and outs of all the cash in the business on a daily basis, and you can … we typically, in my business, we use it to … we use it to just make sure we don’t run out of cash, but if you wanted to, it’s something that you could very easily experiment with and say, hey, I think I’m going to do this much, I’m going to make this much money in the next 30 days, if I do hit that goal, how is that going to change things for me for this month?  And then what expenses are associated with generating that extra revenue?  So we’re obviously using Excel, that is all formulated, and it’s actually not that fancy, to be honest.  It’s actually pretty straightforward, and really, I think anyone could use it.

Parker:  Well, it’s straightforward to you, Corey.

Corey:  Yeah, I know.

Parker:  Because you’re a spreadsheet guy, but what I will say is the concept behind it isn’t super difficult.  It’s essentially, you know, a spreadsheet where you plug in when you think you’re going to get your money on which days, and you plug in when you think you’re going to have to pay bills on specific days, and so it’s something if you did a little research, you could put together.  What I will say is our course that we’re launching in October, part of the course that we’re launching is going to have this spreadsheet in it, and we actually will teach our students how to utilize this spreadsheet in their own business, because the concept in general isn’t difficult, but it’s … it’s just you need to take the time to do it, because you do have to go through and see when you’re invoicing people or when you’re expecting to get revenue, and then you also need to, you know, actually go and dive into your expenses, and see when you’re planning on paying people, and I think if you’re willing to go in and do that, especially if cash flow is an issue for you, it’s definitely worth it, because it’s been really valuable for us, and once you kind of set it up, it becomes easy to maintain.

Tara:  Yeah.  That sounds like an amazing tool, and I’m … So I know you said that you’re going to have resources where this is better explained, but just so I’m making sure I’m wrapping my head around it right now, I’m assuming you could go into your bank statements, your credit card statements, your PayPal account, your Stripe account, wherever the money’s coming in or going out, and actually look and see historically over say the last month or the last 60 days when the money’s come in, when it’s gone out, and whether that’s going to reoccur in the future.

Corey:  Yeah.

Tara:  Am I on the right track?

Corey:  Yeah.

Parker:  Yeah, exactly.

Tara:  Okay, perfect.

Parker:  And if you do have your bookkeeping up to date, it can make that a heck of a lot easier, because then you’re just going into your QuickBooks account or whatever and looking at, you know, you can generate a report, and it’s a lot easier to click and find transactions, versus trying to just go through your bank statements and your credit card statements.  It’s still possible, but I know it would make things a heck of a lot more difficult for us if we had to do it that way.

Tara:  Yes, exactly, that’s what I was thinking to myself is like I have all of this information readily available to me, I really should have this report, you know, sitting on my desktop.  That’s kind of brilliant.  And then you’re also … are you balancing that against, then, cash in the bank?

Corey:  Yeah, exactly.

Tara:  Okay.

Parker:  So the first transaction that we have our clients, and the product we have that we … in the tutorial, is we … you enter the bank balance.  Whatever bank, whatever your checking account balance has in it, that’s the first thing you do, and then you go through the income, then you go through the expenses, and then make decisions based on the data that’s showing up.

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Tara:  I think Parker mentioned QuickBooks, which is what you guys have me using and I absolutely adore it, is that what you guys use internally as well.

Corey:  Yeah, we use QuickBooks exclusively with all of our clients, including internally.

Tara:  Awesome.

Corey:  Yeah.

Tara:  Is there, are there any other tools that we should be looking at?  Or just, you know, stick with QuickBooks?

Corey:  QuickBooks is really great.  Their customer service is terrible.  Intuit is a very, very large corporation, and nobody, nobody knows what they’re doing whenever you call, so if you don’t have a whole lot of experience with QuickBooks, you either have to get, like, formally trained by someone, maybe take a class or something, or there’s a really great software out there, it’s called Xero, X-E-R-O, and that is really something that a lot of bookkeepers are moving toward, but it’s obviously, it’s a whole new process.  It’s a whole different interface.  So it’s quite a big investment of time, energy, money, all of the above to make the shift, but it’s something that we’ve actually considered, just haven’t executed on, yet.

Tara:  Huh.

Parker: Well, and this is what I’ll say, QuickBooks is the standard.

Corey:  Yup.

Parker:  So if you’re trying to get set up for your business and you want to maximize your ability to transition over to a bookkeeper, or to have your accountant be able to access your information, QuickBooks is it, because it can do everything, and we actually use QuickBooks online for both our own business and our clients, and it’s something that they’re improving much more regularly versus the desktop version, but if we weren’t bookkeepers, we would hire someone to do our bookkeeping for us, because a lot of the times, it’s a very specific skillset, knowing how to do your bookkeeping, and obviously, we are extremely biased, because we have a bookkeeping business, but every new client we’ve brought on who was doing their own bookkeeping, it ends up them doing a lot of work that doesn’t really provide a whole lot of value or make things easier for anybody.  So if you are going to get QuickBooks online or get set up with something like that, either do some research, take a course, take a class, do something if you’re committed to doing your own books, but otherwise, again, maybe we’re just supporting our industry and you think we’re full of crap here.  As soon as you can afford to get a bookkeeper involved in your business that knows what they’re doing, it’s going to … your accountant’s going to thank you, and you’re going to be so much happier knowing someone who actually does this for a living is managing your finances for you.

Tara:  Yeah, I couldn’t agree more.  I wish I would have done it sooner.  So let’s talk about decision-making now.  What are you looking at in your financial information with your, you know, financial knowledge, when you’re say, looking, thinking about hiring someone new or when you want to go buy, you know, standing desks for the office, or maybe you want to attend a big conference, how do you decide whether you can afford it or not?  Whether that’s a good business decision or not?

Corey:  Yeah, this is something that I think Parker and I have different views on.  It’s actually, I think, one of the things we struggle with most as a partnership.  I am much more willing and quick to invest in things, like standing desks.  Not to throw you under the bus there, Parker.

Parker:  That’s okay.  I can be … I can be a cheap ass sometimes.

Corey:  Yeah, yeah, and Parker is much more analytical.  You know, he thinks things through, and it’s a really good balance.  Luckily, I don’t have to think about things, I just tell Parker, “Hey Parker, can we do this?”  And then he’ll interject and say yes or no, or he’ll say no, and we’ll have a discussion about it and go from there, but generally speaking, we don’t really have an issue of should we invest in this, should we invest in that.  We pretty much most of the time, we just do it.  We don’t really have to … we have the luxury of not having to think about it.  Now, I will say with this product, that was a lot more difficult, that was a tough call, and obviously, hiring people, it’s a tough call.  We, with hiring, with regard to hiring, specifically, we typically, we like to have a huge, a very large amount of prospects in the pipeline that we could potentially execute on if we hired someone.  So that’s how … that’s more or less how we decide to hire more people, and then with regard to the product, that one was, you know, it’s basically a year of investment and time and money, again, and energy, and so we also had to slow down our engagement pretty dramatically to take on that level of work.  In the meantime, my wife also had twins, so we had a lot going on when we were trying to make the decision about creating the product, but ultimately, I think it’s going to … it’s going to pay off.  It’s a huge gamble, though, no doubt.

Parker:  Well, and the one thing I’ll say is, you know, again, because we are a very steady revenue type business, we only have a certain amount of leftover money every month, unless, you know, because our … our revenue is definitely, like since I came on in the business, our revenue has increased dramatically, but we’ve also taken on my salary, we’ve taken on another bookkeeper’s salary, so it kind of balances out all the extra money that comes into the business.  So for us, we have … it’s not like someone who’s launching products who all of a sudden has an influx of cash and goes, “Oh, I have all this extra money, so I’m going to go spend 10 grand and go work with this coach I’ve wanted to work with,” or buy, you know, new equipment and new computers for everybody or something.  It … again, because it’s so steady that, you know, when we do make an investment, it’s typically not going to be a massive investment. 

If we need to get a new computer for somebody, we can cover that.  If we need to get the desks, we can cover that, because as much as Corey is making everyone think that he just spends money whenever he needs it, we also … He’s also done a good job of making sure there’s always kind of a buffer in the business to cover that, because to us, a buffer is really important.  Having some extra cash every month that sits there and builds up in a reserve, and it’s something that we’re … we want to build to be even bigger, because it allows … that buffer allows us to make these investments when we need to, and it also allows us to not stress out if one of our clients has to leave because their business is struggling or something along those lines, then we’re not stressed out about having to replace that revenue so quickly. 

So that’s the one thing that is very important to me, and I think Corey feels it’s really important, too, is just trying not to spend all the money in your business every month, because especially, I know a big struggle when you’re starting a business is making sure you can pay yourself, and that’s something Corey and I, you know, we have set amounts that we know we want to be making every month, but you have to … I think in order to run a stable business, and at least this is the way we’ve been doing it, is you just have to be ready to make sometimes sacrifices on your own payroll if you need to build that buffer or if you need to cover maybe a larger expense one month versus another.

Tara:  Yes, awesome, thank you for sharing that, and you … I forget which one of you said, you know, you have the luxury of being able to cover these different expenses.  You know, maybe not that giant $10,000 coaching package or whatever it might be, but these things that come up on a regular basis that you just want to be able to pay for, you have the luxury of being able to do that, and I think I want to make the point to people listening that it’s less that you have the luxury to be able to do that because your business is so successful, and more that you have the luxury to be able to do that because of everything you’ve described to this point.  The fact that you are checking your numbers, the fact that you know what your cash projections are, the fact that you know how much cash is going to be in the bank from day-to-day.  I think that’s where the real luxury is, right? 

Corey:  Yeah, yeah.  That’s a really good point.  Excellent point.  Yeah.

Parker:  Yeah, and that’s … and that’s where I think Corey and I definitely both agree.  As much as I think Corey doesn’t worry about spending as much as we do, we both feel very strongly that planning and forecasting and looking ahead and trying to stay ahead of our business is really, really important.

Tara:  Amen.  All right.  Let’s talk … so I want to talk more about the impact that developing this program has had on your business, but there’s one more question I have just sort of on the general financials that I want to get to, which is how do you guys set goals for sales or for new clients?  What are you looking at?  What are you basing those kind of goals on?  Because this is a question that I get asked all the time, and I want to have a better answer for it.

Corey:  Yeah, yeah, so we have, Parker and I have an agreed upon goal, a monthly goal, for client attraction or engagement, really, and that’s 2.  So we try and engage two clients a month, and if we have a client leave, we just simply add that to our goal.  We don’t meet it every month, and that’s fine.  We do our best to meet that goal, though.  So that’s … that’s … that’s our main goal, and then obviously, we have … we have other … other goals in the business, like I just had one top of my head, what was it?  I can’t remember.

Parker:  Well, in general, and you know, one thing I want to add, Corey, is the fact that we’re wanting these two clients a month because we do have a monthly target that we’re working towards getting, because when I started in the business, we had a much smaller goal, and as I got more skilled and we were taking on more clients, and we had a better idea of what both Corey and I want to be making and what we want to be paying our employees.  That’s a goal that we’ve essentially hit, but now, we’re looking to get a goal that is going to make sure that everybody on the team has plenty of work to do and is fully maximized, and then also making sure that we have the target amount we want to have extra every month, because we have some months where we will have some extra money we put in the bank just because of, again, those back work projects where we might get an influx of cash outside of what our clients are paying us on a monthly basis, and some months, because a client’s paid late, we might get an influx of revenue that gives us a little extra profit at the end of that month, but we want to work towards getting our monthly revenue to a place where Corey and I are making what we want to make, our employees are making what we want them to make, and we have a certain amount of extra, again, savings. 

I always call it buffer, it’s kind … just because it’s that extra money that just you can put into your savings and just know that you’re building a buffer or cushion for the business every month, and we do have an ultimate goal of what we want to build our savings up to, just to … to make the business even more stable, but you have to start somewhere, and the best way to start is to get your monthly target, hit that monthly target, and then stick with it every month, and just try to maintain it.  Which, you know, there’s ups and downs of every business, but I’d say so far, I think we’ve been, you know, we’ve been working towards that target pretty successfully.

Corey:  And then if I could just add one more thing, Tara.

Tara:  Yeah.

Corey:  Real quick.  I just remembered what it was.  Another really big aspect, I know you asked about specifically sales or new clients, but a big aspect of sort of our goal setting is surrounding customer service.  We … we … I think there’s an untold truth between me and Parker that our clients take priority above all, and so obviously, it’s very expensive to lose a client, and it’s also very expensive to acquire a client, so keeping our clients happy and doing everything we can to support them really is our number one goal, because once they’re in the door, then you know, we want them for life.  We don’t want them to leave.  And that’s actually, I pride myself about that.  We don’t lose clients.  It’s very rare.

Tara:  Kind of go back to what Parker was saying, too, it sounds like your sales goals are based on sort of an almost like an ideal P&L that you kind of have set in terms of targets.  Like this is the profit you want to have, this is how much of that profit.

Corey:  Yeah.

Tara:  Yeah, and then that I think is …

Parker:  That’s perfect.

Tara:  I think that’s like a gamechanger for a lot of people, because I think the first place we go is how much of this do I want to sell, whereas if we’re focused on the sort of the supporting financials of that, how much do I want to have in the bank, how much do I want to pay myself this month.  That helps us create much more informed goals that have meaning to them.  It’s not just a sales goal that’s out there sitting and doing, you know, that means nothing to us.  It has real substance in our businesses.

Corey:  Our budget … our budget, actually, that’s exactly what we do.  That’s how we know what our targets are, because we have an ideal P&L that we were sort of working toward, and that’s … so that’s how we know that we need two clients a month.  So that’s what we’re working toward.

Parker:  And that’s not something we’re necessarily looking at every month on our call, but we do look at it fairly regularly, just because again, we … because we’ve been doing the bookkeeping for so long and we have lots of historical data, it’s really easy for us to pull up an average P&L of what our business looks like every month.  So for us, it’s very easy to just go, okay, let’s change that revenue target, let’s change any expenses that might go up with that revenue target.  For instance, if your revenue goes up, your merchant fees are probably going to go up, but just make some little adjustments there, and then it becomes very clear what we need to work towards, and it’s very difficult to do that if you don’t have any financial organization set up in your business whatsoever.

Corey:  Yeah, and Parker and I have a sticky pad on our desks that’s a goal, it’s a number, and that’s what we’re working toward, and there’s actual hard data behind that number, it’s not just some … something we’ve pulled out of thin air and decided okay, this is a goal.  There’s actual … there’s actually a path that we’re trying to … that we’re on to try and hit that goal by a certain day.

Tara:  Love it.  Love it, love it, love it.  Love goals, especially sales goals.  All right.  So you guys have talked about the kind of do it yourself program that you’ve created, and you’ve also talked about how that really required investing basically a year’s worth of time and energy.

Corey:  Yeah.

Tara:  And you know, maybe hiring some additional contractors, hiring some help.  Can you talk about both the impact that’s had on your financials so far, and the impact that you expect to have on your financials in the future?

Parker:  Yeah, so this has been, this is going to be a gamechanger for us, because as we’ve just talked about, we have a steady business, and I think, Tara, you’ve probably been in this situation yourself, where you have a steady client base, and that helps to create a somewhat steady revenue stream, but to us, a stable business is a business that has multiple revenue streams.  It just helps to protect the business if, you know, some clients leave, well, you know, we’re doing well with the product, so that’s building up our savings.  So for us, it was a no-brainer, and it’s a big reason why I, you know, Corey and I decided to work together, because … because of my background, the product creation was right up my alley, because I have experience with video and video editing and audio and audio editing and I’ve done a lot of presentations and put together PowerPoints and so, and that’s something Corey just didn’t have as much experience in, but as Corey eluded to earlier, you know, in doing so, we … we kind of slowed down.  Like, you can only focus on so much in your business. 

I think it’s something everybody experiences, and we definitely experienced it this year, is you can’t … you can’t do everything.  You have to figure out what’s the most important thing to your business, believe in that, and then take action towards it, and we knew we could continue to grow our client base, but there just gets to be a certain point where we’re going to max out, and you know, we’re going to have to hire somebody else, and it’s just a slower process.  It’s something we don’t mind doing, but we felt like if we could say, hey, we’ll slow down taking on some clients right now, so it would free me up to have a little extra time to work on the product every week, and even though we did sacrifice some potential revenue during that time, we feel like it’s going to be so much more worthwhile, because we can get back to growing our client base, and when we launch our course in October, it’s going to not only be a promotional tool for us, but it’s also going to be an extra revenue stream, and that’s going to open up so many more doors for our business, because now we’ll have the consistent revenue from our clients every month.  We’re still going to be focusing on servicing our clients every month, but now we’ll have this … this product that’s going to generate revenue that doesn’t demand our individual time.  Like I think, Tara, you call it, like, hours for money, or however …

Tara:  Yeah, time for money, yup.

Parker:  Time for money.  That’s going to kind of be working for us.  Now, obviously, I still will need to be, you know, working on it and supporting the customers that are happening there.  Like, there’s no question that’s going to happen, but it’s just going to … it’s going to generate revenue for us that we just couldn’t generate by just taking on clients every month, so that’s going to allow us to build up our savings a lot more and stabilize the business, and it’s going to allow us to invest in our business in new and different ways that we just wouldn’t have been able to do so before.  So we’re really excited about it, but for us, either way, however successful the launch is and however successful this product is for us, it’s still just icing on the cake for us, and that’s where we feel very lucky that we do have a stable revenue stream right now, and whatever we do with the product is just going to add on top of that steady revenue stream and make the business more stable.  It’s not something where we’re going to have to rely on the revenue from the product to cover certain expenses or pay ourselves from.

Tara:  Brilliant.  Brilliant, brilliant, brilliant.  Thank you so much for sharing that with everyone, because you know, everyone out … not everyone, but a lot of people out there are, you know, trying to build a business based off of a passive income product like that when there is a clear path to profitability with a service or with something that’s more hands on, something that’s done for you, and what you guys have just demonstrated with that is that there is this huge, potentially a much bigger opportunity to create an income stream in your business that is icing on the cake, and that is, I think that’s great.  I wish that for everybody.  I want to see more businesses built with that kind of model in mind, because I think it’s just so smart.

Corey:  Thank you.

Tara:  Yeah. 

Parker:  Well, and I think, and I just one thing I wanted to add on that is I think there’s a little bit of so many business owners go I don’t want to have to, I want that passive income, because I … I don’t know if it’s just a matter of not wanting to work so much or if there’s just the time for money scenario just isn’t as appealing, but I know for us, stability is really important.  We’re both married, Corey has a family, we have mortgages, so for us, that stability means the world to us.  So even if we might, if we may have sacrificed some opportunities in the past to generate some influx of … influxes of cash, and as nice as that would have been, we would never sacrifice a launch or an influx of cash, we would never sacrifice that for the stability we have in our business right now, and that’s just the way we look at it.

Tara:  Awesome, awesome.  So real quick, can you tell us what the product, what the program actually is?

Parker:  Yeah, so because we work every day with … with entrepreneurs and primarily online entrepreneurs, that’s our niche, we just have, we realized a long time ago that there’s just not enough information about what do you do with your money in your business?  How do you create stability in your business?  How do you create systems in your business that just make sure you’re doing everything you can to protect and grow and nurture your business?  And I think, for us, we always felt like what we do isn’t particularly sexy, but as soon as we bring on a new client and they see what we do and they start to learn really what it takes to stabilize your business and put good financial practices in their businesses, it demystifies things, and I know, like, with you Tara, when we first started, you didn’t feel like you were that numbers, finance person, and now, it’s like you’re a P&L pro, and that’s the stuff that we … we love to see, because we know the difference it makes in our business, we know the difference it makes in our client’s business, but you know, not everyone can work with us.  There’s only, you know, Corey and I can only take on so many clients. 

So that’s, I think it’s a typical story when it comes to the reasons behind wanting to develop a course, but we felt like we just got so much feedback from people saying, “I just wish I understood this part of my business more,” that we just said there’s a huge opportunity for us to educate the online entrepreneur community, and do so in a way that’s not intimidating, and gives every entrepreneur the opportunity to learn the basics that every business owner just should know about their business, you know, why they should have a business entity and the relationship they should have with their bookkeeper and what their accountant should be doing for them and how they can set up their own budget and how they can set up their P&L the way we set up the P&L for our business and for our client’s businesses.  It’s again, kind of these tactical things that are really second nature to Corey and I now, and I think fairly second nature to most of our clients, just because most of our clients have been working with us for at least a year, two, three years, but for so many entrepreneurs who aren’t exposed to this, it’s … it’s game changing.  So that’s where this course that we’re launching in October is just going to allow us to give every entrepreneur the opportunity to learn the basics of what they should be doing in their business to set themselves up for success and to manage their finances in a way that other successful businesses are managing them.

Tara:  Awesome.  I love it.  Guys, thank you so much for joining me.  This has been absolutely fascinating to me.  I hope it’s fascinating to our audience, and we’ve said game changing a couple times, but I know that this interview’s going to be a gamechanger for a lot of people out there.

Parker:  No, thank you for having us.

Corey:  Awesome.

Parker:  We just love the opportunity to talk about our nerdy numbers stuff.

Corey:  Thanks, Tara.

Tara:  Thank you. 

Find out more about Corey, Parker, and Evolved Finance at

Next week, I talk with Nicole Stevenson, cofounder of popular maker conference, Craftcation.  Nicole and I talk about how she works with event sponsors, how she prices the event, and the unexpected challenges that ultimately arise producing an event of Craftcations magnitude.

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