Regardless of the reason for hanging your own shingle, you’ve found some “success” along the way. Success can mean a lot of things, but in this context, we’re focusing on financial. You have steady, recurring revenue from a growing client base. You are coming to the realization that there aren’t enough hours in the day to accomplish your business goals. You can’t personally serve any more clients without some help.
Michael Gerber’s book “The E-Myth Revisited” explores this dichotomy well. You have the technical know-how to serve clients, but you have done such a great job growing the business that you feel capacity constrained. You get fulfillment from offering direct service to customers but are forced to make a critical decision: accept no new clients or hire a team to support you.
Right now, you are wearing every “hat” in your business - strategic visionary, technical specialist, CFO, administrative assistant, etc. That worked for a while when you had a small client base. But suddenly it doesn’t work anymore. You need to decide whether you will stay a solopreneur or move to a scalable business model.
Each person and business is different, so I can’t decide that for you. I read and listen to podcasts. A LOT. In fact, my biggest strength according to the StrengthsFinder assessment is “Learner” which means I love to absorb new information and perspectives from other. Every business coach I’ve read or heard via podcast has a similar message: you are likely not going to grow a seven-figure business by yourself.
Let’s assume you’ve given it serious consideration and decided to grow a scalable business. Here are four important considerations:
1. Distinguish high value from low value tasks
I’ll use myself as an example because I’m going through many of these decisions at SV CPA Services. The high value tasks for me (as a CPA) include: fostering deeper relationships with clients, providing business consulting services, and working as an outsourced CFO. The lower value offerings are more administrative in nature — preparing engagement letters, setting up and confirming meetings, etc. I need to maximize the amount of time spent directly with clients and minimize time spent “behind the scenes” doing lower-level work. Does this mean it is necessary to hire a full-time administrative assistant? No. Online meeting schedulers like Calendly enhance productivity, too.
Look at your worth as an owner and honestly evaluate whether you could hand off select tasks to someone else.
2. Hire others who excel in your areas of weakness
Where do you really shine? Are you the creative brain with an eye for visual design? Then you probably shouldn’t be wasting time with bookkeeping, a time-intensive process for detail-oriented people. The biggest mistake I’ve witnessed is when a solo entrepreneur hires a carbon copy of himself or herself. Naturally, we are drawn to people like us. But in the business context, this should be avoided. We need to collaborate with others who see things differently or have a skill set we don’t already possess.
3. Decide: internal team member or external contractor?
This global, sharing economy is making it easier than ever for companies to grow without having a lot of internal staff. You can hire a logo designer on Fiverr for a one-time fee of $100 (social media kit and all) or get an in-house art director to design all branding materials at a much greater expense. There are several items to consider when hiring independent contractors or internal team members. Tax consequences and professional liability considerations shouldn’t be the only factors. You need to think about the short AND long-term needs of your business.
Can a virtual assistant thousands of miles away from your office handle all your administrative needs, or do you need someone local who will scan documents when you physically hand them over? Are you working from a home office with limited space for another person to work? What is your budget for the scope of work this person will provide? If you need more guidance on the financial implications for the business, read my other article about the book Profit First. Above all, think proactively about each position or role you are looking to hire. Most owners use a hybrid method: external contractors for short, one-time projects or low-level recurring projects and internal hiring for longer-term initiatives.
4. Systematize to lessen the learning curve
Systematization is critical to scale and grow a business. I’m a work-in-progress, accustomed to doing everything myself. Who wants to spend time writing down every policy or procedure?
Michael Kitces is revered in the financial services industry — in addition to running a successful blog for financial advisors, he has his hands in several other related businesses. So when he recommends a tool, I take notice. In a recent XY Planning Network podcast, Michael recommended Snagit. The Snagit technology provides an affordable way to screen capture what you are doing, so your new hire will see how you prefer to have it handled. It only takes a few minutes to turn the screen capture on and off, and the video is available indefinitely.
As always, I hope this information is helpful to you. Your success is my success! If you found value from this article, please share it with others on social media. If you’re making that transition from solopreneur to employer and need someone like me in your corner, here's my contact info. Taking the next step is never easy, and I’d like to support you in any way possible.
All the Best,
Deborah Meyer, CPA, CFP(R)