You’re running an MSP with solid monthly revenue—but somehow, your bank account doesn’t reflect it. You’re not paying yourself consistently, taxes sneak up every quarter, and there’s never quite enough left over to grow. Sound familiar? You’re not doing anything wrong. You’re just operating within a system that wasn’t designed for service-based businesses like yours. […]

You’re running an MSP with solid monthly revenue—but somehow, your bank account doesn’t reflect it. You’re not paying yourself consistently, taxes sneak up every quarter, and there’s never quite enough left over to grow. Sound familiar?

You’re not doing anything wrong. You’re just operating within a system that wasn’t designed for service-based businesses like yours. That’s where Profit First for Managed Service Providers comes in. By setting up a handful of purpose-driven bank accounts, Profit First helps you take control of your money, prioritize your own compensation, and run a leaner, more profitable business.

It’s not just about managing expenses. It’s about making sure your business works for you.

Start with the Five Foundational Accounts

At its core, Profit First works by dividing your business income into separate bank accounts, each with a clear purpose. For MSPs, the five foundational accounts are:

1. Income
This is your holding account. All revenue lands here first. From this account, you make allocations to the other four—ideally twice a month, on the 10th and 25th. Think of it as your sorting tray, not your spending pot.

2. Profit
This account is your reward for being a business owner. It’s not a bonus or leftover cash—it’s an intentional allocation. You’ll take quarterly profit distributions from this account, and the rest stays as a buffer for emergencies or opportunities.

3. Owner’s Pay
You work in the business, and you deserve to be paid like it. This account ensures you can consistently compensate yourself, separate from profit or dividends.

4. Tax
No more tax-time panic. You set aside a percentage of income in this account so you’re ready when the IRS comes calling. This account also covers payroll taxes and quarterly estimates.

5. Operating Expenses (OpEx)
This is what’s left over after you’ve paid yourself, set aside profit, and covered your taxes. You’ll run your business from this account—and if it feels a little tight at first, that’s a good thing. It forces you to evaluate every expense and spend more intentionally.

Tailor It to Your Business

One of the strengths of Profit First is its flexibility. Once the foundational accounts are in place, you can add accounts that support your specific business model. In Profit First for Managed Service Providers, we talk about how MSPs often face unique cash demands—like investing in new hardware or expanding service offerings. That’s where extra accounts come in handy.

Debt Paydown
Still carrying legacy debt from startup costs or aggressive growth? Set up a dedicated account to chip away at it with consistent, manageable payments. Watching that balance shrink is incredibly motivating.

Expansion
Planning to hire, move into a larger space, or invest in high-ticket tools? Create a separate account so you can build up the funds without robbing your operating budget.

Custom Accounts
Every MSP is different. Consider accounts for:

• R&D: For developing new services or testing tools
• Marketing & Client Acquisition: So you can fund campaigns without disrupting monthly cash flow
• Team Bonuses or Professional Development: Keep your talent happy and growing

Small Shifts, Big Results

Setting up Profit First accounts may feel like a small shift, but it has the power to completely transform the way you view—and manage—money in your business. You’ll gain clarity, control, and confidence. And best of all? You’ll finally feel the freedom that comes from running a profitable, predictable business.

Need help getting started? At Go Figure Accounting, we specialize in helping MSPs implement Profit First in a way that works for their real-world operations. Whether you’re new to the system or ready to optimize your current setup, we’re here to guide you.

Because the truth is, you didn’t start your MSP to struggle. You started it to thrive. Let’s build a financial foundation that makes that possible.

Let’s be real—traditional accounting wasn’t built for the way MSPs run their businesses. If you’ve ever looked at your P&L and thought, “Looks like I made money… so why is my bank account empty?” you’re not alone. This disconnect is something we hear all the time from MSP owners. Your business is growing, your clients […]

Let’s be real—traditional accounting wasn’t built for the way MSPs run their businesses.

If you’ve ever looked at your P&L and thought, “Looks like I made money… so why is my bank account empty?” you’re not alone. This disconnect is something we hear all the time from MSP owners. Your business is growing, your clients are happy, but you’re still sweating payroll every other Friday. So what gives?

The problem isn’t you. The problem is the system.

Why the Old Way Doesn’t Work

Most accounting systems were designed for large corporations with CFOs, finance departments, and comfortable cash reserves. But as an MSP, you’re often running lean and fast. You’re juggling monthly recurring revenue (MRR), tools, techs, tickets—and you’re expected to understand your margins from a report you got three months ago? No wonder it feels disconnected.

Traditional accounting focuses on profit as what’s left over after everything else gets paid. But that model doesn’t prioritize you—the business owner. And it certainly doesn’t give you a real-time view of what you can safely spend. Even worse? It ignores cash flow, which is the lifeblood of every MSP.

How Profit First Changes the Game

At Go Figure Accounting, we offer a different approach—one that actually works for MSPs. Profit First flips the old-school equation and puts you first:

Sales – Profit = Expenses

This means you set aside profit before you spend a dime. Using dedicated bank accounts for Profit, Owner’s Pay, Taxes, and Operating Expenses, you give every dollar a job. That way, when money comes in, it’s already working toward your goals.

The beauty of this system is that MSPs are naturally set up to thrive with it. Your recurring revenue gives you predictability, which makes your allocations easy to manage and scale. And when you’re intentional with your money, you start seeing results fast.

Here are just a few of the wins we’ve seen from MSPs using Profit First:

• A clear plan to pay themselves what they’re worth
• No more tax season surprises
• Budgets that actually reflect how they operate
• Real profit, set aside every quarter (yes, in a real account!)

You Built This Business to Thrive

If you’re tired of feeling like your financials don’t reflect your hard work—or worse, like you’re still stuck in survival mode—it’s time to try something new.

Go Figure is a Profit First Mastery-Certified firm, and we specialize in helping MSPs find more money in their business. We know your business model, your pain points, and the tech behind it all. More importantly, we know how to make Profit First work for you.

Let’s turn that MRR into real, measurable success. Book a call with us today, and let’s map out a plan to make your money work as hard as you do.

Let’s cut to the chase: You didn’t start your business to scrape by. You started it for freedom, impact, and—yes—money. So why are you still paying yourself less than you’d make at a mediocre corporate job? The hard truth? It’s not because your business isn’t making money. It’s because you haven’t structured it to pay […]

Let’s cut to the chase: You didn’t start your business to scrape by. You started it for freedom, impact, and—yes—money. So why are you still paying yourself less than you’d make at a mediocre corporate job? The hard truth? It’s not because your business isn’t making money. It’s because you haven’t structured it to pay YOU first.

Welcome to the Profit First reality check. If your bank account is playing a never-ending game of “maybe next month,” it’s time to rewrite the script. Here’s why you’re not earning six figures yet—and how to fix it before burnout eats you alive.

1. You’re Trapped in the “Leftover” Mindset

Too many business owners pay themselves whatever’s “leftover” after expenses. Spoiler: There’s never enough leftover. The problem? You’re treating profit like an afterthought instead of a priority.

Fix It: Flip the formula.

Instead of Revenue – Expenses = Profit, switch to Revenue – Profit = Expenses. This forces you to build a business that can actually sustain your personal financial goals.

2. You Don’t Have a Profit System

If your financial strategy is “I’ll figure it out when I have time,” you’ll never have time. Or money. Profit needs a system—one that ensures you consistently pay yourself first.

Fix It: Use the Profit First method.

Allocate percentages of every dollar that comes in. A basic starting point? 15% to taxes, 40% to owner’s pay, 40% to operating expenses, and 5% to pure profit. Adjust as needed, but stick to the system.

3. You’re Playing CFO Without a Playbook

Let me guess—you started your business because you’re great at what you do, not because you love spreadsheets. And yet, here you are, winging it with no financial strategy.

Fix It: Get help.

If you don’t have a CPA or bookkeeper who understands entrepreneurial money flow, get one. Financial clarity is the difference between “barely scraping by” and “consistent six-figure paychecks.”

4. Your Pricing is a Dumpster Fire

Too many business owners underprice their services out of fear. The result? You’re working twice as hard for half the money.

Fix It: Charge what you’re worth.

Calculate your real costs (including your OWN six-figure salary) and price accordingly. If you lose a few clients who balk at the price, good. The right ones will pay.

5. You’re Stuck in Growth Mode Without a Profit Plan

More revenue should mean more money in your pocket. But if you’re scaling without controlling costs, you’re just running harder on a financial hamster wheel.

Fix It: Scale smarter.

Before you chase bigger revenue, make sure your current revenue is actually working for you. If you can’t pay yourself well now, more sales won’t fix it—they’ll just make the problem bigger.

6. You Haven’t Made the Leap to Seven Figures

Six figures is great, but why stop there? If you’re running a business that’s generating solid revenue and you’re consistently paying yourself well, it’s time to start thinking bigger.

Fix It: Shift from operator to CEO.

The difference between a six-figure entrepreneur and a seven-figure business owner? Systems and mindset. Automate, delegate, and focus on high-value tasks that generate exponential returns.

Ready to Pay Yourself What You Deserve?

Your business exists to serve YOU, not the other way around. If you’re still taking scraps, it’s time to shift your mindset, get strategic, and claim the six-figure paycheck you should be earning.

Start today. Because “next month” isn’t a strategy—it’s a stall tactic. And you deserve better.

Let’s be real—running a business is exhilarating, but taxes and bookkeeping? Not so much. Most entrepreneurs would rather focus on scaling their business than balancing a spreadsheet. But here’s the hard truth: Ignore your numbers, and they will come back to haunt you—usually in the form of IRS notices, cash flow crises, and gut-wrenching stress. […]

Let’s be real—running a business is exhilarating, but taxes and bookkeeping? Not so much. Most entrepreneurs would rather focus on scaling their business than balancing a spreadsheet. But here’s the hard truth: Ignore your numbers, and they will come back to haunt you—usually in the form of IRS notices, cash flow crises, and gut-wrenching stress.

I’ve seen it all as the owner of Go Figure Accounting. And trust me, the biggest financial disasters don’t happen because business owners are bad at math. They happen because of avoidable mistakes. So let’s break down the seven ways business owners fail at their taxes and bookkeeping—and how you can dodge these pitfalls before they sink your business.

1. Mixing Business and Personal Finances

Your business isn’t your personal piggy bank. Yet so many entrepreneurs swipe their business card for personal expenses—or vice versa. Not only does this create a bookkeeping nightmare, but it also makes tax time a mess.

Fix It: Open separate bank accounts for your business. Keep every expense categorized properly, and if you must take money out, do it through owner distributions (and make sure you’re paying yourself properly!).

2. DIYing Without Understanding Accounting Basics

Yes, bookkeeping software like QuickBooks and Xero make things easier. But just because you can do it yourself doesn’t mean you should. Misclassifying transactions, skipping reconciliations, and misunderstanding cash flow can lead to costly errors.

Fix It: If you’re not a numbers person, hire a professional—at least for quarterly check-ins. You’ll save time and avoid expensive mistakes.

3. Ignoring Profitability in Favor of Revenue Growth

Revenue is exciting. It makes you feel like you’re winning. But if you’re not keeping an eye on profitability, your high revenue might be hiding razor-thin margins—or worse, losses.

Fix It: Track profitability monthly. Follow the Profit First method—allocate profit first, then budget expenses accordingly. A business that runs on profits, not just revenue, is a business built to last.

4. Forgetting About Estimated Taxes

The IRS isn’t your forgiving best friend. If you don’t set aside money for estimated taxes throughout the year, you’ll get hit with penalties and a hefty bill come tax season.

Fix It: Plan ahead. Every time you make money, set aside at least 15% for taxes in a separate account. Work with a CPA to ensure you’re paying the right amount each quarter.

5. Not Keeping Receipts and Documentation

Your bank statement is not an expense tracker. If you get audited and can’t produce receipts, you could lose out on deductions—or worse, owe back taxes with penalties.

Fix It: Use an app like Expensify or Dext to snap photos of receipts and categorize them instantly. Store everything digitally so it’s easy to access if (or when) you need it.

6. Ignoring Cash Flow Until It’s a Crisis

Profitable businesses still go bankrupt. Why? Cash flow. If you don’t know what’s coming in and going out, you could end up scrambling to make payroll or cover expenses.

Fix It: Forecast your cash flow monthly. Don’t assume money in the bank means you’re in the clear—plan ahead and keep a buffer for slow months.

7. Waiting Until Tax Season to Get Organized

If April 15th (or March 15th for S-corps and partnerships) is your wake-up call, you’re already behind. Scrambling to pull together financials at the last minute leads to missed deductions and costly errors.

Fix It: Stay ahead. Reconcile your books monthly, review financial reports, and check in with your accountant regularly. Don’t make tax season a panic-driven scramble—make it a smooth, predictable process.

Bottom Line: Your Finances Need to Work For You, Not Against You

Bookkeeping and taxes aren’t just about compliance—they’re about financial clarity. When you take control of your numbers, you take control of your business’s future.

The good news? You don’t have to go at it alone. Whether it’s hiring a CPA, implementing Profit First strategies, or just setting up better financial systems, the right moves today can save you a world of headaches (and money) down the line.

So ask yourself—are you in control of your finances, or are they controlling you? If you’re not sure, now’s the time to change that.

If you’re running a Managed Service Provider (MSP) or cybersecurity firm, you already know the industry is moving at breakneck speed. With private equity firms circling like hawks and larger players gobbling up smaller ones, the M&A scene is hotter than ever. Whether you’re looking to cash out or merge with a bigger name, the […]

If you’re running a Managed Service Provider (MSP) or cybersecurity firm, you already know the industry is moving at breakneck speed. With private equity firms circling like hawks and larger players gobbling up smaller ones, the M&A scene is hotter than ever. Whether you’re looking to cash out or merge with a bigger name, the biggest deal-breaker isn’t your tech—it’s your books.

As a CPA and Profit First Professional who’s seen deals soar and crash, I can tell you one thing: If your financials are a mess, your dream exit could turn into a nightmare. So, let’s talk about how to get your financial house in order before you even think about selling your MSP or cybersecurity business.

1. Know Your Numbers—Really Know Them

Buyers want clean financials. Period. If your revenue is unpredictable, expenses are unclear, and contracts aren’t properly accounted for, you’re in trouble. Here’s what you need to focus on:

• Recurring Revenue vs. One-Time Sales – Buyers love Monthly Recurring Revenue (MRR). If most of your business comes from project-based work, expect a valuation hit.
• EBITDA Matters More Than You Think – Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is the magic number in M&A. Run a profitability analysis and normalize expenses so your EBITDA is crystal clear.
• Deferred Revenue Accounting – Cybersecurity and MSP firms often bill in advance for services. If you’re not handling deferred revenue correctly, you could be overstating your earnings—something that can kill a deal in due diligence.

2. Clean Up Your Books Before Buyers Do

Your books should be as sharp as your security protocols. Sloppy financials scream risk, and buyers will use that to lower their offer—or walk away entirely.

• Separate Business & Personal Expenses – It sounds basic, but you’d be surprised how many owners mix personal and business transactions. Clean it up.
• Fix Your Chart of Accounts – If your financial statements look like a maze, simplify them. Create clear categories for revenue, expenses, and liabilities.
• Ensure GAAP Compliance – Generally Accepted Accounting Principles (GAAP) matter in the M&A world. If you’ve been using cash accounting, consider switching to accrual to better reflect your business’s financial health.

3. Get Your Contracts in Order

MSPs and cybersecurity firms rely on service contracts, but many sellers don’t realize how much these agreements impact valuation. Buyers want clarity and security, not surprises.

• Ensure Contracts Are Assignable – If your customer contracts don’t have an assignment clause, transferring them to a new owner could be legally complicated.
• Standardize Terms & Pricing – If you have different pricing models across clients, that’s a red flag. Buyers want predictable revenue streams, not chaos.
• Lock in Multi-Year Agreements – The longer your contracts, the better your valuation. If you’re month-to-month with most clients, start pushing for at least 12- to 24-month agreements.

4. Work with the Right M&A Team

Even the cleanest books won’t sell your business for you. You need an A-team to get the best deal.

• Hire a CPA Who Knows M&A – Not all accountants understand how to structure a business for sale. Find one who does.
• Work with an M&A Advisor – These pros help negotiate the best deal and navigate the process.
• Legal Expertise is a Must – Cybersecurity M&A deals often involve complex liability issues. A lawyer specializing in tech acquisitions can save you from hidden pitfalls.

5. Have a Post-Sale Plan

Congrats, you closed the deal! Now what? Some buyers want founders to stick around for a transition period, while others prefer a clean break.

• Earn-Outs vs. Lump Sums – Some deals include earn-outs, where you get paid based on future performance. Know the risks before agreeing.
• Non-Compete Agreements – Many buyers will want a non-compete clause. Make sure it’s fair and doesn’t box you out of your next venture.
• Tax Planning – A big payout sounds great—until the tax bill hits. Work with a CPA to minimize capital gains taxes and maximize your net earnings.

Final Thoughts

Selling your MSP or cybersecurity business is a high-stakes game, and getting your financials right is the key to a successful exit. Treat your books like you treat your clients’ networks—secure, organized, and bulletproof. With clean financials, solid contracts, and the right team by your side, you won’t just sell your business—you’ll maximize its value.

So, before you start entertaining offers, ask yourself: Are my books deal-ready? If the answer isn’t a resounding “yes,” it’s time to clean up before the buyers come knocking.

Starting Profit First today equips you with a method to prioritize profit, improve cash flow, and enhance client satisfaction—all key elements for a successful cybersecurity or MSP business in a competitive market. 1. Achieve Consistent Profitability Profit First ensures that you’re setting aside profit with each payment, making profit a priority rather than an afterthought. […]

Starting Profit First today equips you with a method to prioritize profit, improve cash flow, and enhance client satisfaction—all key elements for a successful cybersecurity or MSP business in a competitive market.

1. Achieve Consistent Profitability

Profit First ensures that you’re setting aside profit with each payment, making profit a priority rather than an afterthought. This consistency can help you build a financially resilient business, even in months with unpredictable revenue.

2. Smooth Out Cash Flow Fluctuations

MSPs work often involves high-value projects that can lead to feast-or-famine cycles. Profit First helps you allocate funds in a way that smooths out cash flow, providing a buffer during slower periods.

3. Keep Up with Rapid Tech Changes

The cybersecurity field evolves quickly, and Profit First allows you to dedicate funds for regular tech upgrades and essential tools without disrupting other expenses. This way, you stay up-to-date without sacrificing profitability.

4. Build a Cushion for Certifications and Compliance

Certifications like SOC 2 or ISO 27001 are necessary but can be costly. By using Profit First, you’ll have dedicated funds for these expenses, so you stay compliant without any financial strain.

5. Reduce Financial Stress

Profit First’s system helps take the guesswork out of managing money, giving you a clear structure for allocating every dollar. With a method in place, you’ll feel more in control, allowing you to focus more on your core services.

6. Enhance Client Retention Efforts

By setting up a client retention fund, you can actively invest in keeping clients happy, which is often more cost-effective than finding new ones. Happy clients lead to referrals, testimonials, and longer-term relationships—all boosting profitability.

7. Prepare for Cyber Liability and Legal Costs

The threat of liability is real in cybersecurity. Profit First allows you to earmark funds specifically for insurance and legal expenses, making sure you’re prepared for any issues that could otherwise drain your finances.

8. Simplify Financial Decision-Making

With separate bank accounts for each purpose, Profit First makes it clear where your money stands at all times. Instead of analyzing endless numbers, you can make quick decisions about spending, hiring, or investing in tools based on what’s in each account.

9. Gain a Competitive Edge with Predictable Pricing

When profit is built into every service, you can confidently price your offerings to ensure both client satisfaction and profitability. Consistent profitability allows you to maintain or grow your services without compromising financial health, giving you a steady edge in the industry.

10. Create a More Sustainable Business

With Profit First, you can plan and invest strategically in growth while staying profitable. This method empowers MSPs and cybersecurity professionals to scale at a financially healthy pace, laying the foundation for a sustainable, long-lasting business.

Cybersecurity and MSP businesses have unique financial needs and compliance requirements.  As a Profit First Professional familiar with your industry, Go Figure can help customize TAPs, identify cost-saving opportunities, and ensure that your financial strategy aligns with your business goals.

Empowering Business Owners and Redefining the Accounting Industry with Heart and Expertise Go Figure Accounting, led by Rachel Siegel, has been awarded the prestigious 2024 Profit First Professionals Firm of the Year. This recognition highlights Rachel’s commitment to both financial excellence and her clients’ success, making waves in the accounting industry by transforming businesses, one […]

Empowering Business Owners and Redefining the Accounting Industry with Heart and Expertise

Go Figure Accounting, led by Rachel Siegel, has been awarded the prestigious 2024 Profit First Professionals Firm of the Year. This recognition highlights Rachel’s commitment to both financial excellence and her clients’ success, making waves in the accounting industry by transforming businesses, one balanced ledger at a time.

“Rachel Siegel and Go Figure Accounting are the embodiment of Profit First at its best,” said Mike Michalowicz, author of Profit First and founder of Profit First Professionals. “Rachel’s dedication transforms her clients’ confidence, resilience, and long-term success. She doesn’t just use Profit First; she lives it, changing lives and businesses alike. That’s why Go Figure is our 2024 Firm of the Year.”

Go Figure Accounting’s award is a testament to Rachel Siegel’s holistic approach to business and finance. Whether advising clients or guiding her team, Rachel’s mission is clear: to ensure every individual and business she works with feels supported, empowered, and ready to tackle their next challenge.

Rachel isn’t just a numbers person—she’s a people person, too. With over 25 years of experience in both private and public accounting and a degree from Simmons College, Rachel has become an expert in financial consulting, especially for service-based industries like real estate, medical, and legal sectors. As one of fewer than 100 Profit First Mastery Certified accountants in the United States, Rachel’s firm brings a unique, personalized approach to accounting.

Under her leadership, Go Figure Accounting has thrived as a Profit First Mastery Certified firm, delivering customized, cash flow-focused strategies to clients across the country. Rachel is also the author of Profit First for Optometrists and the upcoming Profit First for Cybersecurity and Profit First for Managed Service Providers (MSPs), further cementing her reputation as a thought leader in financial strategy.

But Rachel’s success isn’t limited to spreadsheets and balance sheets. She believes in the power of balance—in business and in life. “Empowering people, not just their profits,” is her guiding principle, and she leads by example. When she’s not advising clients or developing cash flow systems, Rachel can be found cheering on her favorite sports teams, exploring new destinations, and spending quality time with her family.

Her dedication extends beyond client relationships. Rachel is committed to fostering confidence and growth in her almost all-female team, encouraging personal and professional development. Through office hours, mentorship programs, and leadership workshops, Rachel has created a culture at Go Figure where women in accounting, CPAs, and entrepreneurs are all empowered to excel.

How can I make my business more profitable? “That’s the million-dollar question, right?” Rachel Siegel says with a smile. As the owner of Go Figure Accounting and author of Profit First for Optometrists and the upcoming Profit First for Cybersecurity, she’s no stranger to helping businesses maximize profitability in complex industries. Profit First for MSPs and Cybersecurity CompaniesRachel explains […]

How can I make my business more profitable?

“That’s the million-dollar question, right?” Rachel Siegel says with a smile. As the owner of Go Figure Accounting and author of Profit First for Optometrists and the upcoming Profit First for Cybersecurity, she’s no stranger to helping businesses maximize profitability in complex industries.

Profit First for MSPs and Cybersecurity Companies
Rachel explains that many service-based businesses, including MSPs and cybersecurity firms, operate under the traditional formula: Sales – Expenses = Profit. In this setup, profit becomes whatever is left over after paying expenses. “The issue with this approach is that profit is treated like an afterthought, and for businesses that need to manage recurring contracts, technology upgrades, or security solutions, waiting for profit to materialize isn’t sustainable,” she notes.

Instead, Rachel advocates Profit First, a methodology the prioritizes profit from the outset: Sales – Profit = Expenses. In this scenario, businesses are forced to be more intentional with their spending.

Why This Matters for MSPs and Cybersecurity Firms
For MSPs and cybersecurity professionals, managing recurring costs like software licensing, infrastructure updates, and staff training can be financially draining. With profit often falling to the bottom of the list, it’s easy to lose track of long-term financial goals. Rachel explains, “Profit First ensures that profit isn’t an afterthought—it’s baked into your financial planning from day one.”

How Profit First Can Help You Scale
Rachel emphasizes that this approach is especially valuable in industries where monthly recurring revenue (MRR) is a key growth driver. “By allocating revenue to specific accounts for profit, taxes, and operating expenses as soon as it hits your account, you ensure that profit is secured first, and you never find yourself short on cash when tax season rolls around or when you need to invest in infrastructure,” she says.

MSPs and cybersecurity firms often operate on thin margins, making it critical to allocate funds wisely. The Profit First system encourages setting up separate bank accounts for profit, taxes, operating expenses, and owner’s pay. “Every time revenue comes in, you allocate a percentage to each account based on your targets. This guarantees profit rather than hoping for it at the end of the quarter,” Rachel explains.

Imposing Financial Discipline on Operating Costs
Rachel adds that for MSPs and cybersecurity firms, which often face fluctuating expenses—such as unexpected equipment failures, client demands, or rapid tech advancements—the Profit First method is a game-changer. “By limiting the amount available for operating expenses, you’re naturally encouraged to scrutinize every purchase. This curbs overspending, especially in areas like software subscriptions, training, equipment, and marketing, all while ensuring your profit margins remain intact,” she says.

This discipline is particularly important in industries where it’s easy to justify high costs for technology or staffing, often leading to cash flow issues. With Profit First, you maintain a steady, predictable flow of revenue to cover essential costs without sacrificing your profitability.

Building a Resilient Business
One of the greatest benefits of Profit First for cybersecurity firms and MSPs is the ability to build a stronger, more resilient business model. “When profit is guaranteed, you have a safety net in place. This allows you to weather tough economic conditions, invest in better tools, and even expand your service offerings without fear of running out of cash,” Rachel says.

For service providers, especially in the high-demand and high-risk cybersecurity sector, having the cash flow to invest in new technologies and certifications is crucial for staying competitive. “By using Profit First, you’re not just creating a more profitable business—you’re creating a more resilient one that can innovate and scale over time,” Rachel concludes.

By integrating Profit First into their operations, MSPs and cybersecurity professionals can transform how they handle finances, making profit a non-negotiable part of their business model while maintaining the flexibility to grow and adapt in a rapidly changing industry.

Running a small business is a bit like juggling – there’s always something to keep in the air, and it only takes one misstep for everything to come crashing down. While the thrill of delivering quality products, expanding your brand, and making customers happy can be exhilarating, one simple truth stands out: cash is king.  […]

Running a small business is a bit like juggling – there’s always something to keep in the air, and it only takes one misstep for everything to come crashing down. While the thrill of delivering quality products, expanding your brand, and making customers happy can be exhilarating, one simple truth stands out: cash is king. 

Understanding how money moves in and out of your business is crucial to keeping everything running smoothly. Yet, cash flow issues are among the most common headaches for small business owners. In fact, according to the SMBA, over one-third of small businesses cited “lack of capital” as the primary reason they had to close. That’s why it’s so important to plan ahead and ensure that your business always has the funds it needs.

Proper cash flow management involves anticipating both the money coming in and the money going out. To do this effectively, you need to know your current financial situation inside and out, including your payment processes and debts. Additionally, having a plan for handling any unexpected disruptions is key to avoiding potential cash flow crises.

Fortunately, most cash flow issues stem from a few common causes. By understanding these, you’ll be better equipped to prevent them or at least manage them more effectively when they arise.

Creating a Budget

Budgeting is essential for gaining control over your business expenses. However, in 2021, more than half of small businesses didn’t have a formally documented budget. If you’re looking to create one, start by setting specific and realistic financial goals. Overestimating your expenses – assuming you’ll pay more this year than last – can give you a buffer and help you avoid surprises.

While some may see budgeting as restrictive, having a budget actually provides a financial focus. It also gives you a benchmark to measure against when making spending decisions throughout the year. Remember, a budget is a living document, not set in stone. As your business grows or as external factors like inflation change the cost of goods, revisit and adjust your budget accordingly.

Building an Emergency Fund

Just like in personal finance, businesses need to be prepared for the unexpected. Unfortunately, many small businesses aren’t as prepared as they should be. Surveys show that 17% of business owners would have to close if they experienced two months of declining revenue. Additionally, 25% of businesses don’t reopen after a disaster.

Having an emergency fund can make a huge difference. This fund can help cover unexpected expenses, such as a surprise tax bill, a sudden increase in supply costs, or repairs after a disaster. To start building your emergency fund, first determine how much you need to cover your immediate expenses for one month. Then, decide how many months’ worth of expenses you want to save. Even if you can only set aside a small amount each month, it’s important to start. Set up an automatic transfer so you never forget, and make sure the money goes into an account designated solely for emergencies.

Managing Late Customer Payments

Customers are the heart of any small business, but when they make late payments, it can cause serious cash flow problems. Unfortunately, late payments are all too common, with 87% of businesses reporting that they typically get paid after their invoice due date. 

To help avoid this issue, consider making a few small changes. Send invoices promptly, offer multiple payment options, and be clear about payment terms and expectations upfront and on every invoice. You might also want to ask for a deposit or full payment before starting work, and consider charging a late fee to encourage timely payments.

Planning for Growth

Growth is generally good news for a small business, but if it happens too quickly or without a plan, it can strain your finances. Many business owners plan to expand their current location, service, or website, or even open additional locations. But growth often comes with increased costs – more employees, better equipment, larger office space, or higher shipping expenses.

To prepare for growth, create a plan for the expenses that will come with it. This might involve securing financing through a bank, applying for a small business loan, or using a business credit card for smaller purchases. Each option has its own pros and cons, so it’s important to research and plan ahead.

Paying Yourself a Salary

When cash is tight, it’s tempting to skip paying yourself to keep more money in the business. In fact, 26% of small business owners don’t pay themselves a salary. However, this can lead to more stress and distraction, negatively impacting both you and your business. Moreover, not paying yourself can cause issues come tax time.

Instead of going without, research what a fair salary for your role should be. Consultants, industry trade groups, and entrepreneurs in your field can provide guidance. One survey found that 46% of founders pay themselves less than $100,000 annually, but the key is to find a balance that reflects your business’s financial health and your personal needs.

Cash flow problems are a significant source of stress for small businesses, but they’re not inevitable. By understanding the common causes and taking proactive steps, you can keep your cash flow steady and focus on what really matters – growing your business.

As a small business owner, it’s easy to get caught up in the day-to-day grind. From managing customer requests to handling inventory, there’s always something demanding your attention. But while it’s important to keep things running smoothly, focusing too much on the daily tasks can cause you to lose sight of the bigger picture. That’s […]

As a small business owner, it’s easy to get caught up in the day-to-day grind. From managing customer requests to handling inventory, there’s always something demanding your attention. But while it’s important to keep things running smoothly, focusing too much on the daily tasks can cause you to lose sight of the bigger picture. That’s why it’s essential to spend time working on your business, not just in it.

What Does It Mean to Work On Your Business?

We know you’ve heard that saying before, but what does that mean exactly? It means investing time and energy into building a business model and strategy, not just completing day-to-day tasks. After all, a successful enterprise needs both short-term goals (hitting sales targets) and long-term objectives (developing new products/services or exploring new markets).

But, this is particularly challenging for small business owners to accommodate. Without sprawling administrative teams, these leaders often have no choice but to put out fires and focus on the immediate rather than the important. With limited resources, escaping the day-to-day tasks and taking a more strategic view can be almost impossible: there is often no one else to take on the immediate tasks.

According to Rachel Siegel, founder of Go Figure Accounting, working in your business means handling the immediate tasks that keep your business afloat—processing orders, responding to emails, dealing with customer service issues, etc. These tasks are crucial, but they’re also reactive. You’re putting out fires as they arise rather than planning how to avoid them in the first place.

“You need to have systems in place that will allow you to step away from the day-to-day details and focus on the long-term,” she says. “This could involve delegating tasks to other staff members, outsourcing whenever possible, or utilizing software solutions that automate low-level tasks.”

Indeed, working on your business is about taking a step back to look at the broader picture. It involves strategic planning, setting long-term goals, and thinking about how to grow and improve your business.

This might include tasks like:

Developing a marketing strategy: Instead of just running ads as needed, take time to think about your brand, your target audience, and how to reach them effectively.

Streamlining processes: Look for ways to make your business more efficient. Are there tasks that could be automated? Are there better tools you could use?

Building your team: Consider your staffing needs not just for today, but for the future. What roles will you need to fill as your business grows? How can you develop your current employees’ skills to meet those needs?

Financial planning: Rather than just keeping track of your expenses and income, work on a financial plan that helps you understand where you want to be in five years—and how you’re going to get there.

Why It Matters

When you’re only working in your business, you’re stuck in a cycle of reaction. This can make it hard to see opportunities for growth or to pivot when the market changes. Working on your business helps you break free from that cycle. It allows you to be proactive, to plan for the future, and to build a business that isn’t just surviving, but thriving.

How to Get Started

Start by setting aside time each week to focus on strategic tasks. Even an hour or two can make a big difference. Use this time to assess where your business stands, identify areas for improvement, and set goals for the future. It might feel strange at first to step away from the daily hustle, but in the long run, this is the kind of work that will take your business to the next level.

Remember, your business should work for you, not the other way around. By investing time in working on your business, you’re setting yourself up for success and creating a foundation for sustainable growth.