Busting Business Finance Myths with Jacinthe Koddo

Everyone Feels Uncomfortable Talking About Their Business Finances...

So, let's get uncomfortable together! When you're a new business owner it's easy to put a lot of pressure on yourself to know everything, be good at everything, and 'fake it until you make it' until you figure it out. 

It can be hard to ask for help .. or even know WHO to ask for help. Especially if you've been in business for a few years and your business financials are starting to become a bit of a hot mess. But let's keep it real, not asking for help could be costing you thousands of dollars every year. 

Listen to this podcast to hear Jacinthe's stories of tough business finance lessons she learned in her early business years and why she's now focused on helping entrepreneurs understand how their money works so they can make empowered financial decisions, shame and guilt-free!

Just a Few of the Magical Tidbits Jacinthe Shared in This Episode

• How bad business advice left Jacinthe with $1000's in unnecessary credit card debt in her early business years (let her story be your lesson!)
• Business financials are complex work and complex language that is next to impossible for new entrepreneurs to intuitively understand until you've gone to school specifically to learn these things
• Don't quit your day job! Why having a full-time job is important in your early years
• There are 4 different types of business accountants and it's important to know which one you need right now
• We are all unified in our discomfort and overwhelm when it comes to our business finances so let's ditch the shame and ask for help!

"It's okay not to know everything about your business, especially around the financials, because it's a complex world." - Jacinthe Koddo, Koddo & Co

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About Jacinthe!

Jacinthe is a Canada-based financial coach, educator, and the founder and CEO of Koddo & Co. As a serial entrepreneur with 6 businesses started, 4 failures, and 2 growing successes, Jacinthe has learned the ins and outs of business finance over the last decade. She is now on a mission to increase financial literacy in, and sustainability of, women-led businesses, which leads to a positive societal ripple effect in their communities and throughout the world. Jacinthe does this work through group programs, 1:1 financial coaching and Contract CFO services.

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Transcript

Jacinthe Koddo

[00:00:00] Jacinthe: it's okay not to know. everything about your business, especially around the financials, because it is a complex world. It's a complex language that's been designed to exclude people who didn't go to school specifically for it. Yep. And so it's totally normal to not know, feel shame around it, feel like you should know.

[00:00:19] Jacinthe: And what I would say is hopefully you can let that drop and go ask questions and find the help that you need and not feel . Like you're drowning In the black hole. Your financials. 

[00:00:31] Lindsay: Welcome to the work, less play more podcasts for busy entrepreneurs who are ready to ditch the hustle. Stop burning on busy work and get back to having a life. My name's Lindsay Johnson, AKA The Radical Connector, and I spent the last 10 years teaching first time entrepreneurs, how to get customers and make money.

[00:00:52] Lindsay: Listen in, as I chat with other hustle, recovering business owners, as we share our top tips, for you guessed it working less and playing more. [00:01:00] Let's do this. .

[00:01:03] Lindsay: Hello friends. Welcome back to the Work Less, Play More podcast. Today we are diving into an uncomfortable topic, and that is, Money, specifically your business financials. And stay with me, I promise it's not gonna be boring. We're not gonna make you do any accounting on today's podcast , but we are gonna dive into some of the reasons that you might be struggling to feel comfortable or confident around your business finances, and remind you, Hey, unless you are a trained bookkeeper or accountant, why would you know these things?

[00:01:40] Lindsay: And it's okay. Today we are talking to Jacinthe Koddo, a Canadian based financial coach, educator, and the founder and CEO of Koddo and Co.

[00:01:49] Lindsay: As a serial entrepreneur with six businesses started four failures and two growing successes. Jacinthe has learned the ins and outs of business finance over the last decade. She is now on a [00:02:00] mission to increase financial literacy in and sustainability of women led businesses, which of course leads to a positive societal ripple effect in our communities and throughout the world.

[00:02:11] Lindsay: Jacithe does this work through group programs, one-on-one financial coaching, and she even offers contract CFO services. Now if any of that sounded a little bit confusing or you're not sure what I meant, guess what?

[00:02:23] Lindsay: We are gonna dive into it in today's podcast.

[00:02:25] Lindsay: So get ready to get a little nerdy with me and let's talk about your business financial.

[00:02:30] Lindsay: And why it's perfectly normal and a okay to not know what you're doing and how to ask for help. Ready friends, let's do this thing. 

[00:02:37] Lindsay: Welcome to the Work Less, Play More podcast. I am super excited that you're here. How you doing? 

[00:02:44] Jacinthe: I'm doing well. Yeah, happy to be here. Excited to chat. 

[00:02:47] Lindsay: Me too. Today's topic is so important and I think people are going to love it, but probably also feel a little triggered because today we're talking about money.[00:03:00] 

[00:03:01] Lindsay: Specifically, we're talking about your business money, your money mistakes, your fears around money, understanding your business finances, and how to empower yourself as a business owner to know your numbers and, I don't know, handle your money well. So tell everybody that's listening, first of all, your initial thoughts when it comes to money and entrepreneurship.

[00:03:23] Jacinthe: Well, from my own experience, I can tell you that. It is majorly triggering. Yeah, it was for me in my early days of entrepreneurship for sure. So I didn't come from, , going to accounting school and, , doing the things all right from the beginning. I was an entrepreneur, creative entrepreneur.

[00:03:43] Jacinthe: I went to school for interior design and, , learned project management and budgets that way. But I very quickly, when I first started my first business, , dug myself into credit card debt. Incurring thousands of dollars of interest. Couldn't pay my rent twice in the course of six months over my entrepreneurial journey in the early [00:04:00] days.

[00:04:00] Jacinthe: And I had to call my mom to pay my rent the next day. And, um, Yeah, like, it, it just was very overwhelming. And so I see that with the clients I work with and the people that I work with and, , the teaching that I do , and I can so relate to all the feelings that come from feeling like, Oh, I should know, cuz I felt that way too.

[00:04:18] Jacinthe: I, I should know how to do this. Yeah. I should know how to do bookkeeping when I've only been taught how to do it in an hour. I should know, , how to make sure that I have enough cash in the bank. I didn't have a lot of financial literacy personally even growing up, right? So how when it comes to business, which is even more complicated, was I supposed to know those things?

[00:04:37] Jacinthe: So it's a common experience I see in. , early stage entrepreneurs, we call them, or , solo printers who are starting out and , I can totally relate to that. . Well, and it, it is, it's very similar in when I talk with folks from the marketing and sales perspective, right? There is this belief when we start a business that.

[00:04:56] Jacinthe: I, I don't know if it's a belief. I don't even think it's conscious to tell you the truth, [00:05:00] that we should know everything. Mm-hmm. , and if we don't know everything, we're somehow a, a failure. Yeah. And I think that comes from the pioneering spirit of entrepreneurship and the like, make ish happen, spirit of entrepreneurs.

[00:05:12] Jacinthe: Um, but yeah, like what you don't know, especially around finances. Really hurt you. Yeah. 

[00:05:19] Lindsay: And let's talk about this concept of going into massive amounts of credit card debt story, when you first started your business. I, I know that a lot of people do that. They, they spend on things they don't need to.

[00:05:29] Lindsay: They make, um, I, I wanna say unwise investments only because they don't have the wisdom yet. What do you think was behind you going into all that credit card? 

[00:05:41] Jacinthe: It was honestly not having personal financial literacy in the first place, right? Mm-hmm. , like I only learned how to budget about seven years ago, personally, was it seven?

[00:05:50] Jacinthe: Seven or eight when a friend introduced me to a birth, a personal budgeting app, and she became my budgeting buddy. Like we did it together because we were such close friends and the [00:06:00] taboo of talking about money wasn't there. Yeah. Like we, we were both really practical people. I was coming off of, working at my latest startup or , whatever business idea it was where I didn't really take the advice of all the business coaches out there of having a part-time job and a bridge job and, , something to pay the bills while I was.

[00:06:16] Jacinthe: Fiddling around with this business idea. And so I had just gotten a new job and she said, It's time for you to start personal budgeting. Right? And luckily, this is one of my best friends, so, you know, I listened to her. But, um, that is really what started my own financial journey, was learning through this personal budgeting app, which luckily had some incredible free resources.

[00:06:34] Jacinthe: And I had my friend to be my accountability buddy, so I think that, because I, I was never really taught when I was a kid. Money was tight when I was a kid, but I didn't really know that until I became an adult and was like, Oh, that's why we went to every single shoe store in the mall and then came back to the first one to get , you know, the shoes that we had tried on first because we needed to check the price on everything.

[00:06:55] Jacinthe: So it, it happened with that. And then it also, In those early [00:07:00] days of my entrepreneurship journey, like the, the business coaches that were out there, and maybe they're still out there and I'm just not following any of them, were like, If you build they will come kind of thing, right? 

[00:07:09] Lindsay: Oh, yes. 

[00:07:10] Jacinthe: Just take what you're passionate about and make it into your business.

[00:07:14] Jacinthe: And so I just was like, Great, It'll, it'll be fine, right? Yeah. And just like swipe, Oh, pay for this, pay for that. And on top of that, I didn't have a plan, right? Like I didn't have what I now call the financial roadmap. I didn't have this plan for what I was spending and what. What I should be investing in for my business that was going to return revenue back, money back in.

[00:07:37] Jacinthe: So the marketing and sales efforts, cuz in early days of entrepreneurship, like those are the things we should be investing in. The thing that's gonna bring us more money and then we can spend money on everything else once, you know, we get some stable income coming in. So yeah, I think that was kind of the , the precursers for to that plus, you know, I was just young and naive.

[00:07:53] Jacinthe: I had, I didn't have any entrepreneurs around me growing up. My dad went out on his. He's an electronic technician and, [00:08:00] and fixes, uh, audio equipment. Um, so he went on on his own when I was in high school, but he was always the sole prop and he never had to do any marketing cuz everybody in the city we grew up knew him.

[00:08:10] Jacinthe: So I didn't have any of that kind of built in mentorship that a lot of entrepreneurs that I've seen who are successful in the beginning do have entrepreneurial families or, connections in the early days. So yeah, that's really, really what led me down that path.

[00:08:24] Lindsay: Well, and it's, you brought up so many really important parts, um, which we, I would love to, I would love to hear your take on this cuz the, the build it and they will come myth. I talk about this a lot because it is, it, Sold. It's packaged and sold to new vulnerable entrepreneurs who don't know a darn thing.

[00:08:46] Lindsay: And it is really attractive to just think that you can just build something and it will sell. And, and of course for those who don't know, build it and they will come. Is the plot of a movie . A Kevin Cost movie. [00:09:00] Yeah. Where he hears a voice to turn his cornfield into a ball diamond and the ghost of his father comes back to play catch.

[00:09:08] Lindsay: You know, and, and there's more going on in the movie, obviously, But listen, it is my dad's favorite movie. Great plot. Great story for a movie. Terrible business plan, not a business plan. There is no such thing as build it and they will come. Mm-hmm. with the rare instances of, of cases like your dad, like where, where there is a high demand and you have already, you already have that word of mouth happening for you.

[00:09:30] Lindsay: Yes. Yeah. 

[00:09:30] Jacinthe: You've been in the industry for, you've been in the industry for a long time, and then you go in your own and it's just like, Okay, great. We're gonna follow him, right? Yeah, exactly. Yeah. 

[00:09:38] Lindsay: My dad has a friend that moved to the, the, one of the small islands on, on Vancouver Island. And he does like boat repair and he is constantly turning around business and, and it takes him months to be able to get to everything.

[00:09:50] Lindsay: And again, he didn't have to do any marketing cuz it's what he's known for and it's in such high demand. But for the most part, most service. Entrepreneurs, that's not their reality. Right. And so I [00:10:00] think, yes, to your point and and I, and I'm coming around to a question here cuz this concept of build it and they will come, like you said, it leads entrepreneurs to quitting their job way too soon when they need to be putting their own personal finances into their business in the beginning until their business can pay for itself, right?

[00:10:17] Lindsay: Mm. Or they're not. I could say having that bridge job that carries them through and at least pays their rent, puts food on the table while their business is starting to to thrive. And so, if you could give, if you could give a piece of solid advice, and I really want listeners to hear right now, what would you say around things like bridge jobs, quitting your jobs, how to, how to not hang your survival needs on a brand new business.

[00:10:44] Jacinthe: Well, I would say I didn't wanna hear it when I was in my early stages, right? Yes. Yeah. I didn't wanna hear it, so I totally get it. We all just are like, we just wanna be doing it now.

[00:10:52] Jacinthe: We want our business to be growing fast. , I'm still, I still feel that way about my business. I want it to grow faster. I want it to grow faster and you know, it's doing pretty [00:11:00] well. But yeah, in those early days it was just like, No, I just wanna be doing it, you know? Um, and I would say, They're also in those early days was a lot of like, shame, you know?

[00:11:13] Lindsay: Oh, wait, let's dive into that. Yeah. What's the shame 

[00:11:16] Jacinthe: It felt like my business was a failure if I still had to have a part-time job, even though it, you know, it's like chicken and the egg, right? Yep. Oh, if someone sees me working at some coffee shop or I worked at a brewery of a friends, or I did cater serving, right?

[00:11:30] Jacinthe: There was still this kind. Okay. Well, I say that I'm, I'm out there marketing and doing sales for my business, but then what happens if people see me in this other part-time job? Right? But looking back, it's like, ugh. It's one of the things that I'm just like, if I had only taken that advice, I would've saved myself so many thousands of dollars of interest on the debt that I paid.

[00:11:52] Jacinthe: Or the other thing too is like, . So there's having the job to pay the bills and, , working as, quote unquote side hustle [00:12:00] first. Mm-hmm. in the, in the in between times. And it also depends on, like for me, I was always, all the previous business ideas I had were somewhat innovative. So it wasn't just like okay, this is a common thing people need. It's nothing new. You don't have to educate people about it first. So that was my first business idea. So I was like, I'm doing this dinner salon concept and it can be used as a facilitation method, but first I had to educate all these, , corporate leadership buyers, what this was.

[00:12:26] Jacinthe: And that just takes so long. I learned in my early days of entrepreneurship, this business program I was in at the time, the stat was like, most entrepreneurs go out on their own around 40. And that tends to be from a career they have been doing. And they're like, I can do this on my own now.

[00:12:41] Jacinthe: Yeah, right. So I'm in that stage now with this type of business where it's like I've built another business with co-founders. Learned a ton. That's how I learned all this business. Financial literacy, right? Cause I co-founded this management accounting company by happenstance with a bunch of CFOs, Chief Chief financial officers, CPAs, so certified [00:13:00] accountants, certified professional accountants.

[00:13:02] Jacinthe: And I learned from the inside by building this management accounting company, how you're actually supposed to do your pricing, look at your margins, build a financial model. Track these things so that you are building a profitable business with enough cash in the bank. Understand what you're investing in, like we were talking about earlier, you know, spending wisely and not feeling stressed about the cash because you have this transparent picture.

[00:13:24] Lindsay: Right. Well, and that's , to your point, right? There's the, I would've avoided going into all this, this debt and paying all this interest as one side of it, but also the stress, Like think about the stress you were living under And it's really hard to be excited about and build a business when you're in that much stress.

[00:13:41] Lindsay: And especially because then you begin to see everyone you meet as like your dinner or your grocery bill or your Yeah, the scarcity mindset comes up. Right, exactly. And they're, no, it's no longer about you serving people. It's about, I'm gonna need this person cause otherwise I'm not gonna be able to pay my rent.

[00:13:56] Jacinthe: Exactly. Yeah. And that's not to say like, you know, business [00:14:00] debt can be an amazing tool to leverage. Yeah. So, and I'm talking about like low, low interest line of credit, that type of stuff. Right. But. What happens in like, with me, with my early entrepreneur, I didn't know those were options, right? Yes. I didn't know that that was a thing, and so I just went the easiest route, which was, I got all these credit cards.

[00:14:19] Jacinthe: Let's, let's do it. . So anyway, back to the bridge job. 

[00:14:25] Lindsay: Well, I was gonna say, hang on, because the thing is, and I wanna just, I wanna acknowledge this for listeners that, that, that can relate to this. There is this belief that because we have this build it and they will come mentality. And again, I've been doing this 20 years and so I've seen consistently people have this, this timeframe of six months.

[00:14:44] Lindsay: In their heads they be, it's across the board. Six months I should be able to be like quitting my job within six months, a hundred thousand dollars and six months. No, no problem. And like reality is that takes years to get you for most people and. You know, cuz you fir let's, your first year, [00:15:00] you're just, you're just fumbling.

[00:15:01] Lindsay: Like, you're just like throwing spaghetti against any wall and just trying to figure things out. You're, you know, it's, it's a, it's, it's a wonderfully exciting hot mess of a time as an entrepreneur. But because we have this mentality of.

[00:15:13] Lindsay: Six months, I'll be rolling it a six figure earner. We think it's safe to go into that kind of credit card debt. We think it's okay. Mm-hmm. . And then before you know it, we are in some big trouble. 

[00:15:23] Jacinthe: Mm-hmm. . Exactly. Yep. So, and, and yeah, back to the, the bridge job. So, Like, like I said, I've worked at a friend's brewery.

[00:15:32] Jacinthe: I have done cater serving. I've also done this too while I was working at startups cuz I've worked in, uh, you know, a handful of startups as an employee as well. Not my own, but as, you know, somebody else's employee. And they are just a hot mess, right? Like in the beginning, our own or the people that we work with, everything is a mess.

[00:15:49] Jacinthe: The systems are a mess. They don't have budgets in place. So I also wanna acknowledge that's a totally normal place to be. Yes, for sure. Yeah. Um, and so, I wish that I had had that kind of [00:16:00] job to keep me sane to just have some money. You know, like when we look at not called Maslow's Hierarchy anymore, what is it called now?

[00:16:07] Jacinthe: you know the base? I don't know. I know, I didn't know they didn't change the name. Okay. I'm gonna look this up. Yeah. . Yeah. Um, so the base need, right, like any money coming in regardless of where it's coming from, is gonna make us feel more secure. Yeah. And that will give more brain space and allows to have more power.

[00:16:26] Jacinthe: in ourselves behind what we are actually building. Right? Yeah. So, yeah, I I would totally change that about , what I did, but I've ended up here where I am now. 

[00:16:35] Lindsay: So , you're, you're everyone's cautionary tale. Yeah. You know, when I, when I decided to start my business, um, I actually became a nanny. And I totally fell into that.

[00:16:46] Lindsay: I had put a a, an ad on Craigslist, , and I was like, Hey, are you a busy family that needs help around the house? I'm starting a business and so I've got like basically free time to come help you while I [00:17:00] figure out my own stuff. I was very transparent in this ad and apparently that's called a nanny and so I.

[00:17:07] Lindsay: So many people writing me, I ended up working with a few different families. Um, I did that part-time. I also did part-time ad sales, um, for, for an online publication. And for me it was very much about this is just the job that's paying my bills and giving me money to invest in my business. And you're right that there is this like, how can I say, I'm this big serious business owner and then also I'm picking up the kids.

[00:17:32] Lindsay: School as a nanny, right? Or working in a brewery or a coffee shop. There can be that mentality, um, and especially when people start to have a bigger vision for themselves, right? Yeah. And it, it seems like such small potatoes there can be resentment and really, truly, like we do need to, we do need to keep our.

[00:17:51] Lindsay: Egos out of it. We need to be like, and this is a question I'll often ask folks, like, where is your future? Where are you going towards then what you do [00:18:00] to pay the bills? It, it, it's irrelevant. You're just paying the bills. Um, keep your eye on where you're going, but do not leave so soon that you don't have that money to live and to put into your business.

[00:18:11] Jacinthe: Yeah, and it's interesting too because. I find that, you know, obviously now I have a ton of business financial literacy and personal financial literacy. I also though don't know everything, like both of those worlds are super vast. There's so much I don't know. But what it has allowed me to do, and this is again what I.

[00:18:33] Jacinthe: What I pass on to my clients is like, it has empowered me because before it was taboo. I felt taboo Talking about money in general. Yeah. But the more, and this is so cliche, but like the more I learn about. Business financials cuz that's what I work in. Yep. The more I recognize what I don't know. Yeah. And then it, I feel more empowered to just be like, I don't know.

[00:18:54] Jacinthe: I need to find out the answer. I need to talk to somebody about it. Right. So it's like the more I actually [00:19:00] opened up and learned from my founders or my co-founders and. You know, just like said to all these accountants I was working with, like, what does that mean? Because I've never worked in the accounting world and I'm surrounded by all these CPAs.

[00:19:13] Jacinthe: And they're like, Oh, okay. Right. Like they, they realize that they're speaking this language and I'm just going like, Okay, what does that mean? Explain it to me. So now I have no problem doing that. Yes. And you know, as, yeah. As. as I had more people around me, I could, I felt comfortable. Right? You have to feel com.

[00:19:32] Jacinthe: It's just like anything, right? Anything you're, you're worried about or feel shame around or anything like that, you have to pick the right people to talk to first, but the more that you talk to the right people, the more you're like, Oh, this is totally normal. . Yeah. Like that's what I recognize right from my friend too, also was a fellow solo preneur business owner.

[00:19:48] Jacinthe: So she got me on the personal finance path and then we also were able to just like jam about business stuff and like, We both don't know this answer . 

[00:19:57] Lindsay: And it's, And it's okay. I'm like, my [00:20:00] gosh, why do we put so much pressure on ourselves? Yeah. To know everything. Yeah. And you know, I remember like, like.

[00:20:06] Lindsay: Ideally entrepreneurs, one of the first expenses that they're gonna be investing in is either a bookkeeper or if that's out of their budget, a, a, a consultation with a bookkeeper to at least help them get their books, bookkeeping practices set up, right? Investing in accountant, at least for at the end of the year to help you make sure you're doing everything correctly that sets you up for the next year.

[00:20:26] Lindsay: That is an important expense that I do recommend, like, like again, I'm all about how can you build a business lean. Where can you really not have to worry about spending money, having bookkeeping, having accounting support in whatever way that looks like is an, is an absolute investment that people need to have.

[00:20:42] Lindsay: And then of course, the busier you get, the more complex your business model gets, you know, you'll need more support. Right. However, however, for the entrepreneurs who are 2, 3, 4 years in, I've been totally winging it. And their books are a hot mess and someone asked them. Expense report and they break out in that [00:21:00] cold sweat

[00:21:01] Lindsay: I know that it is so freaking hard to again, expose yourself and expose the hot mess that you are to someone to get some help. What is your advice to the people who know they need help, but literally are dying inside out of the shame of not keeping better books? 

[00:21:20] Jacinthe: Well, I would say yes, I have. I too have experienced that and I've also seen it happen from the other side, right. Cuz I worked with all these accountants and, and also work with entrepreneurs who have had relationships go super sour with previous bookkeepers and tax accountants. Mm. And 

[00:21:37] Lindsay: wait, wait, can I ask what makes a relationship go sour? 

[00:21:40] Jacinthe: Most of the. . In my experience, it's a lack of tr of common language. It's a translation error. Right. So the accountants and bookkeepers speak one language, and the entrepreneurs like, What the heck does that mean? And then like me, in my early days, Yeah. Are scared of asking questions or feeling stupid or [00:22:00] silly.

[00:22:00] Jacinthe: Yeah. That they have to ask these questions and then they just don't, and then they're like, Oh, my bookkeeper. Is doing a terrible job or my accountant's awful. They never get back to me. Yeah, right. So this is a totally common thing that happens all the time and I'm totally 

[00:22:13] Lindsay: One little thing, one little quick thing into that.

[00:22:14] Lindsay: Yeah. Okay. So to all my ADHD entrepreneurs, this is something like when I would meet with my accountant and we would go through my bookkeeping practices and things like that, the amount of times I would have to book another session to have her go through again, cuz I know she's been through it, but now I'm trying to do it and it's like nothing.

[00:22:31] Lindsay: Stuck, right? Mm-hmm. . And that is really common for people who are neuro divergent. Like we do need to hear things over and over, and sometimes these concepts are not immediately grasped. And so just to your point to that, I would say to anyone again, Holy crikey, life is too short to be afraid of feeling dumb.

[00:22:48] Lindsay: Mm-hmm. , this is your business. Okay. Let that go and ask until you understand it. 

[00:22:54] Jacinthe: Yeah. 

[00:22:55] Lindsay: And also it's on onus is on the professional to speak to you in a [00:23:00] layman's way that you can understand so 

[00:23:02] Jacinthe: Well, it doesn't always happen that way, . 

[00:23:05] Lindsay: I know that. I know that. But it's more just like, don't feel ashamed that your bookkeeper or, or, or accountant doesn't know how to communicate effectively with you.

[00:23:13] Lindsay: That's not a you problem, but just keep advocating for yourself in that relationship. 

[00:23:18] Jacinthe: Totally. Yeah. And you know, it's like with any working relationship or any personal relationship, there has to be a fit. So, you know, Yes. I always say get two to three recommendations from people, and it can be from your peers or groups that you're in or wherever, and interview these people.

[00:23:33] Jacinthe: You don't have to go with the first person. Yeah. And especially for creative entrepreneurs, neurodiverse entrepreneurs, women entrepreneurs. We tend to want to connect more or be educated. Whereas, you know, people who have been entrepreneurs for a long time or are building their eighth business, Yeah.

[00:23:51] Jacinthe: They're like, Great, I know what the tax accountant does. Here's the year end financial package, my book. Like they trust what those people are doing. Yeah. Because they've already had experience with it. [00:24:00] But when we're in these early days and also feeling this kind of like shame or embarrassment around not knowing, , A lot of the times we're like, but we wanna know.

[00:24:06] Jacinthe: So we want someone to educate us. Yes. Whether it's the bookkeeper or the tax account about what they're doing so we can understand what they're doing. Yes. And have some trust in that cuz otherwise it's just, it's a black hole. Right? Like the accounting finance side of bus businesses for most people is a black hole.

[00:24:19] Jacinthe: So I would say like, ask for two or three recommendations from people you trust who like, who they work with. , interview those people. Ask them about the, about their approach and be a friend. Like, I wanna learn about what this is. I know that's, maybe not exactly what you do, for example, but I would like some sort of education around this.

[00:24:37] Jacinthe: Yeah. There's also many free resources out there. I've got some on my website. There's lots of, women's groups and , financial literacy raising types, group type groups that will go through some basics, like what is the profit and loss? Yeah, what is the balance sheet? These kind of like what are called standard accounting reports.

[00:24:55] Jacinthe: Um, so those are great things to, to look at. And then there's talking to people like me, [00:25:00] right? So. I'm a business financial literacy coach. I also work as a contract CFO with service based businesses, and what that means is I'm. Glue from the financial side of things. Yeah. And the translator and the coordinator between the bookkeeper, your tax accountant telling you when it's like, Oh, we should probably bring in an HR person, or we should talk to your lawyer about that, or we need to talk to the tax accountant about that.

[00:25:22] Jacinthe: Because in bigger businesses there's these roles of CFOs who oversee the entire, financial operation of a business and they're constantly doing these things. Yeah. And so with small businesses, , that is a thing, and this is why I do what I do. There's a gap, right? Because people reach out to their bookkeeper and they're like, Hey, can you help me understand like what's actually happening in my business?

[00:25:42] Jacinthe: And for most bookkeepers, they are in the details. Like that is where they are incredibly good. And so they'll be like, Well, here's your p and l, here's your balance sheet. Here's what those mean. But like how do you. Take those numbers and use them to grow and scale your business and make forecasts and [00:26:00] make plans and decide when to hire and those types of things.

[00:26:02] Jacinthe: So that's not what a bookkeeper does generally, if you do have one like that, they're a unicorn and it's great cause it's really hard. Right. To go from really detailed to really high picture and one one kind of job. 

[00:26:12] Lindsay: Do you think most bookkeepers are trained

[00:26:14] Lindsay: in forecasting. Exactly. They're not training forecasting. 

[00:26:17] Jacinthe: No. It's a different skill set. Yeah. Yes. It's a different part of accounting. So I'll zoom out for a second too, cuz this comes to my point about a tax accountant. There's four major areas of accounting and most people plus bookkeeping. So four areas of accounting plus bookkeeping.

[00:26:32] Jacinthe: Most people are like, I have an accountant and so they should be able to help me like figure out what's going on in my business. And then their accountant never responds to them and they're like, Oh, my accountant's terrible. Mm-hmm. . But the tax accountant, tax accounting is one of four of the areas of accounting for your business.

[00:26:47] Jacinthe: They're there for compliance with the government regulations. They're there to advise on your total holistic, personal and business, you know, tax picture and make decisions about your RRSPs and TFSA room and all that kinda stuff. And that's just [00:27:00] in a nutshell. There's so much they're in charge of, right?

[00:27:03] Jacinthe: Then there's management accounting, and that's where I sit and that's where your bookkeeper, well your bookkeeper provides the data for all of these areas, right? Cause if we don't have the data from your expenses and your invoices and all this stuff, we don't have numbers to work from. But management accounting is the area where, we look at leveraging the numbers that are in your system to forecast forward, scale and grow the business.

[00:27:26] Jacinthe: Make clear buying decisions. Yeah. You know, look at, um, what we've been spending and what the return is say for like sales spend or, or, um, advertising spend, like paid ad spend if you're doing, you know, any digital marketing ads, that type of thing. So we actually like look in the day to day, month to month, year to year.

[00:27:46] Jacinthe: What is happening from our financial data that we can use to identify patterns, um, see what has worked, what hasn't, so that we can make better decisions for the future. Then there's financial accounting, which is about [00:28:00] financing the future. So that's generally for very large businesses, but with smaller businesses too, financing can include like, Okay, well do we need to go get a business loan?

[00:28:09] Jacinthe: Do we need to go get a line of credit? Right? It's like, how do we actually make sure we have cash to fund the plans that management accounting is put together? And then the fourth one is audit accounting, which. Most small businesses generally won't ever touch except if they get knock on wood, audited by the cra.

[00:28:26] Jacinthe: But there's also private audits, like if you're selling a company or you're getting an investor or. A public company or a non-profit or a charity, they have to go through these third party audits. So four very distinct areas, but like nobody tells us about this stuff. Right. I didn't know that . So, and now I'm like, this is part of what I educate.

[00:28:44] Jacinthe: I'm like, so I work in management accounting and that's where your tax account doesn't, And your bookkeeper is like the one giving all the data. Yeah. But they don't necessarily have the, the big picture for what to then do with it. Right. So yeah, that's uh, In a long winded [00:29:00] way, , 

[00:29:01] Lindsay: I feel like that's probably gonna hopefully blow some people's minds and also hopefully make people realize that yeah, if you're feeling frustrated with your bookkeeper or your accountant, you could be going to them for the wrong thing.

[00:29:12] Lindsay: And I think again, this, this, so it's so funny how much what you do and what I do parallels each other. Yeah. Cause that's what I would say. Like if someone comes to me and they're like, I think I should hire a marketing company, they'll be like, Hold on. What kind of marketing are you needing or what kind of support are you needing?

[00:29:30] Lindsay: Cuz it's usually not a marketing company, it's a social media manager or it is a, you know what I mean? Like SEO or seo Exactly. Sales coaching. Actually a copy writer. Yeah, exactly. A sales funnel expert. And so it's the same thing, but from the financial perspective, it is really important to understand just at least I say, as you said, at a basic.

[00:29:53] Lindsay: Who does what, what their roles are, so you can be reaching out to the right person. And I especially love, [00:30:00] um, I love. The service you offer about that, that the CFO services for, for entrepreneurs, solopreneurs, small businesses, because, yeah, like it is, it is an important role to have somebody who is, is understanding your finances, understanding where you want to go, helping you really grow and scale your business.

[00:30:18] Lindsay: And I love that people don't have to hire an in-house CFO person. Like this is something that they can hire you part-time, to just really help them grow. And I am excited for when entrepreneurs and solopreneurs get that level of business where they get to hire that specific service from you because it's, it's.

[00:30:37] Lindsay: It's good. It's like you're going and you're scaling and guess what? It's no longer all on you solopreneur. You can bring someone in to help you financially just blow your business up. Yeah, I would love to hear what you love about that kind of work with, with the entrepreneurs at that level.

[00:30:55] Jacinthe: Yeah. So before that I wanted to go back to, I think earlier you had the [00:31:00] question. Or maybe this is just how I heard it was kind of what to expect at what level of entrepreneurship. Like when should you get a bookkeeper? When should you get a tax account? 

[00:31:09] Lindsay: I didn't ask that, but that's a great question. Ok.

[00:31:11] Jacinthe: Why should you start with someone like me? Well, yeah, so it kind of plays into this as well. Yeah. So yeah, there's levels, right? So when entrepreneurs are what I, what is called early stage, right, early revenue generally, You know that that year where it's like under $30,000 first one or two years, then you know, it's kind of like as long as you can pull a CSV file from your credit card, like, okay, number one, back up.

[00:31:37] Jacinthe: Have a separate credit card and a separate bank account, a thread of a sweater. Are you sure you wanna pull? I know, I know. I'll do it in a nutshell. Ideally have a separate bank account and credit card for business expenses and purchases. That makes things easy when you're small business. Don't really need to have bookkeeping done monthly, even quarterly.

[00:31:56] Jacinthe: It's just at year end. So it's really easy to just like pull a CSV file from [00:32:00] your bank account and credit card and get that organized, and that's what you give to your tax account at the end of the year. As things start going, like when you're getting to the 60 K mark and above, it can be really beneficial to hire a bookkeeper quarterly ish to just, you know, get your books in order.

[00:32:16] Jacinthe: You'd give them bank statements, um, and as long as you've been invoicing and, you know, recording payments, that's pretty much all they need. And I'm, again, totally generalizing. Yep. And then as soon as we're kind of like a hundred K up, Even 120. Yeah, it makes sense to start getting books done once a month-ish.

[00:32:34] Jacinthe: It can be very low cost, like two to $500, which 500 might seem, seem a lot even at that stage, but that's when you can go even bi-monthly or quarterly still. Yeah. And so that's, we're starting to build our team around the financials and just make sure that like when we come to year end tax time, it's not just like, ugh, overwhelming procrastination, uh, piles of receipts.

[00:32:57] Jacinthe: Everything's digital these days, so as long as you keep your receipts, [00:33:00] you can, you know, grab your CSVs and, and that works fine. 

[00:33:03] Lindsay: Can I tell you a guilty little secret? Yeah. Um, if, if I, if I have an expense that's not a digital receipt, I don't write it off. Because I don't know where the hell that receipt is.

[00:33:15] Lindsay: And even, and, and I know, I know all I have to do is take a picture and upload it to my accounting software. I don't if it's like a $20 and isn't that terrible? And that's, you know what this is. Okay. And I'm gonna say again, this is, this is the, um, the. What we call the ADHD tax, right? Um, there are things financially that cost ADHD ers more because we either don't have the mental capacity to do it or we forget about it, we lose it, and that is, A, a compromise I made with myself years ago.

[00:33:47] Lindsay: Mm-hmm. , that if it's not a digital receipt, I'm not gonna write it off because the, the, the, um, mental burden is too much. And so, you know, maybe I have a couple hundred extra hundred dollars a month that I could be writing off, or a year that I could be writing off, but that's [00:34:00] that ADHD tax that I pay. Um, now friends, I don't tell this to people.

[00:34:04] Lindsay: So welcome to the, the, you know, the dirt under my business Rug. But if it's not a digital receipt. But it's funny cuz when I was doing my taxes last year, I'm like, really? Pretty much because of the pandemic. Like literally everything is a digital receipt these days. Mm-hmm. like it's there, I, it's right there.

[00:34:19] Lindsay: I don't have to go searching for it. And so anyways, I doesn't wanna share that for folks. Yeah. 

[00:34:23] Jacinthe: The site note, well, receipts are the worst. It's so hard. I can't wait until like open data comes and the banks are just like, they have the point of sale information right there, so it's right there. Yeah. It'll come one day.

[00:34:33] Jacinthe: So yeah. No, again, totally normal thing to have happen. Um, yeah. So, Of course, everybody needs an accountant, a tax accountant, on an annual basis to do their tax filing. The earlier the better, in my opinion, like it's worth it as a sole proprietor, and as soon, like when you're. Wondering if you should incorporate, That's a great time to talk to a tax accountant if you haven't already.

[00:34:55] Jacinthe: Um, and then someone like me, like I love having conversations anytime because I'm always happy to [00:35:00] point people in the right direction, um, and get them kind of on the right foot with the right people. Yes. Um, but yeah, from my one to one service side, I usually start with service based entrepreneurs. Um, you know, so comms and PR agencies, marketing people, interior designers, those types who are effectively building agencies.

[00:35:16] Jacinthe: They might not call them. Firms, you know, that type of. Um, around the $200,000 annual revenue mark. Yeah. Because that's when things start getting a little bit chaotic. Like they can be chaotic before, but it's like there's real chaos that's happening cuz there's like money coming and going outta the bank account.

[00:35:34] Jacinthe: They don't actually know if they're making any money. Yeah. They're wondering if they should start hiring employees cuz they're hiring a bunch of subcontractors. They're not sure how they should be paying themselves. They might not have incorporated yet and they're going. They're filing their taxes and their tax accounts like, Ooh, you are gonna pay a lot of tax.

[00:35:50] Jacinthe: So it's like, it's a big cru point. Yes. 

[00:35:53] Lindsay: Can I just, Yeah, pause for a second. Cuz a lot of people might not know that. Like when you get to a certain, revenue point in your business, you need to [00:36:00] be incorporating, otherwise you are paying way too many taxes.

[00:36:02] Lindsay: You can be paying less taxes and I don't think a lot of people. Know that. 

[00:36:06] Jacinthe: Yeah. It's not so much revenue as what your profit is. So as a sole proprietor, any money you have left over your net profit after you take what you sell and how much you sell. Yeah. Um, and the expenses for write off what's leftover is your net profit.

[00:36:19] Jacinthe: And as a sole proprietor, that's, that's all your income, that's what you've earned for the year in the eyes of the, the government. And so generally, and again, you should double check this with the tax accountant . Not, I'm not a tax accountant, but generally it's around like a $60,000 net profit mark is when it starts to be more advantageous to be incorporated, cuz you'll get taxed at a lower rate, um, on the corporate side and you can pay yourself in a different way from your corporation.

[00:36:46] Jacinthe: Um, and so top line revenue, like gross revenue, what you actually invoice is somewhere for most service providers between like a hundred and 120. In, in revenue, but it can also depend if you have no expenses and [00:37:00] you're making 60 K. Yeah, right. It also depends too, on where you wanna take your business though.

[00:37:04] Jacinthe: So if you're making 120 K as your top line revenue, but your net profit's 30 K, you don't necessarily need to incorporate unless you're actively wanting to grow your business, hire people, you know, that type of thing. So it also depends on what your vision is and where you're taking your business. Right.

[00:37:20] Lindsay: Can I just say I hope we haven't lost any of our listeners. I love this stuff. The numbers of it all is so exciting and you know, I think that that is something that like, I, I'm just gonna totally generalize here, but I do think people wanna know that, I do think entrepreneurs wanna know what these, this all means, wanna know how to understand this and really feel empowered to do that.

[00:37:40] Lindsay: Totally. and it's so exciting that somebody like, like you exists who can be like, Yeah, I'll take you under my wing. You're gonna learn all these things and what this means and how to think this way. Yeah. So that, that people can feel empowered over their business finances. Yeah. And make better decisions.

[00:37:57] Jacinthe: Back to one of your early points too, of like when you're looking for a [00:38:00] bookkeeper, a tax accountant, or someone like me to work with is like, what? You should be looking, what should you be looking for? One thing I would say is like, if you feel like ish leaving whatever interview call Yeah. Then that's not the right person, right?

[00:38:13] Jacinthe: Because in my mind and the approach that I take in that, you know, uh, many of the tax accounts and bookkeepers I take is like, we're meeting you where you're at. Yeah, because we know, Yep. We know that this is the state of the world because there is not a lot of financial literacy out there for people in high school and university unless you go to accounting school or do an mba.

[00:38:34] Jacinthe: But I've even talked to accounts and MBAs who are like, Yeah, but I don't actually know how like, The operations of a, of your financials and cash work because they're in a different area of accounting or they've done an MBA and they know like business structure at a high level, but not the day to day, like how the books are done and invoicing and you know, payments and there's all these technic technicalities, right at every single level of your books, your tax accounting, and your.

[00:38:57] Jacinthe: Management accounting. Right? So, but like you [00:39:00] shouldn't feel like ish talking to someone. You shouldn't be made to feel stupid. And so if that's the case, it's the wrong person. 

[00:39:06] Lindsay: Yeah. Get outta there. Yeah. That's such great advice. And honestly, that's great advice for anybody, whether totally a doctor or a coach or a romantic partner, like anybody, if you feel terrible at the end of this interaction,

[00:39:19] Lindsay: Yeah. Uh, no. So tell us a little bit about the roadmap that you've created. 

[00:39:23] Jacinthe: Well, I have a free resource called the Roadmap to a Stable six Figure Biz Guide that will, you know, help those entrepreneurs who feel like , everything's a black hole.

[00:39:33] Jacinthe: Start to get some, their bearings around, um, all the different aspects of their, their financial roadmap and start feeling more confident in the conversations that they're having around the financials and their business. 

[00:39:45] Jacinthe: This is for entrepreneurs who feel like they have no clue what's going on with their financial side of their business. It feels like a big black hole and they are struggling with, you know, can they hire someone? How [00:40:00] should they be paying themselves? How much can they be paying themselves? Yeah.

[00:40:03] Jacinthe: Um, are they actually making any money? Can they invest in bringing on a marketing coach or. Getting a space outside of their home as their office. Right. Um, and what it allows them to do is see transparently into the financial picture of their business so they understand at all times and are working towards at all times, building a profitable business and a business that has enough cash.

[00:40:27] Jacinthe: Because just cuz they're profitable doesn't necessarily mean you have cash and vice versa. Just cuz you have cash doesn't mean it's actually profitable. Yeah. So effectively it's like the tool we use to make sure the business we are. What's called the business model actually works. Yes. Because as for-profit businesses, you know, at the bottom line, we need to be profitable.

[00:40:46] Jacinthe: Yeah. But how we spend that money can vastly vary. And especially with, you know, businesses that are socially conscious, they wanna be treating their people well. They wanna pay themselves well, they wanna get back to their communities. We can do so much [00:41:00] knowing that we're building a profitable business and decide what we're gonna do with that profit to give back.

[00:41:04] Lindsay: I love it. Amazing. We're gonna include all of Jacinthe's contact information, so you connected with her there. And just since I have one final question before we wrap up, uh, at the end of every podcast, of course, this is called The Work Less, Play More podcast.

[00:41:17] Lindsay: I would love for you to fill in the blank. Work less blank, more. 

[00:41:22] Jacinthe: Work less, have more freedom. I love it. Freedom more.

[00:41:27] Lindsay: I was gonna say spend, I know. Freedom more, spend more smartly, . 

[00:41:33] Jacinthe: Yeah. No, all of this is about creating freedom. You know? 

[00:41:36] Lindsay: It, it really is. And, again, empowering yourself to understand your business finances, how to spend and invest wisely. You know how to use the knowledge of your business finances to grow and grow in a solid foundation.

[00:41:51] Lindsay: That's huge. That's huge. ahhh Thank you so much for hanging out with me today. 

[00:41:55] Jacinthe: Yeah, no problem.

[00:41:57] Lindsay: Before we go, do you have any last [00:42:00] imparting wisdom you wanna share with our listeners?

[00:42:02] Jacinthe: I would say it's okay not to know. everything about your business, especially around the financials, because it is a complex world. It's a complex language that's been designed to exclude people who didn't go to school specifically for it. Yep. And so it's totally normal to not know, feel shame around it, feel like you should know.

[00:42:23] Jacinthe: And what I would say is hopefully you can let that drop and go ask questions and find the help that you need and not feel . Like you're drowning Yes. In the, the black hole. Your financials.

[00:42:35] Lindsay: I love that. Oh, that made my heart feel so relieved. Wonderful. Thank you so much for hanging out with me today.

[00:42:43] Lindsay: It has been a blast. And friends, remember to go and look at the show notes and check out Jacinthe and get her roadmap and uh, connect with her if you need a little support, cuz she will whip you into shape in a loving and kind way. Thank you so much Jacinthe. 

[00:42:58] Lindsay: Thanks for having..

[00:42:59] Lindsay: Friends, Thank you [00:43:00] so much for listening in. You'll find all the links to all the resources we discussed over on theradicalconnector.com/podcast. Entrepreneurship is a tool for creating the life of your wildest dreams. But it will also eat up all of your time, money, and energy

[00:43:16] Lindsay: if you let it. If you're a service based entrepreneur and are ready to work less and play more, get on my email list or contact me directly and let's talk about how we can get your business working for you so you can build the life of your wildest dreams and get out there and change the world. Happy connecting by for now.