If you could talk about the creative side of your business forever but get tongue-tied when faced with profit and loss statements (P&Ls), you’re not alone—and you’re not doomed.
Lisa Gilmore founded her interior design business Lisa Gilmore Design 10 years ago, when she was just 25. Her love of hot pink walls and tropical themes took off in the era of magnolia and minimalism. But behind the scenes, she’d dropped the ball with her finances.
After nearly losing everything, Lisa rebuilt the business on steadier financial foundations, and she’s now making $2.25 million in annual revenue. “Now I look forward to doing business and finances, which is crazy!” she says.
On this episode of SUCCESS Stories, Lisa talks to SUCCESS’s Madison Pieper about the Sara Blakely advice she’ll remember forever, how she helps her friends with their personal finances, and her internal struggle over letting go of #GirlBoss.
Fill the gaps in your business knowledge with talented people.
No one is good at absolutely everything it takes to run a business. Unfortunately, that can lead to impostor syndrome: the feeling that you don’t have the skills required for your role, and that your peers are all doing a much better job than you.
Lisa experienced this with the financial aspects of her business. She flourished as a creative founder but didn’t like to think about money. She tried to sweep that part under the rug, which only made it worse.
Instead of worrying about the areas you aren’t certain about, or trying to fake your way through them, hire people who do have those particular talents. (Lisa credits Sara Blakely, founder of Spanx, for this insight.)
For Lisa, that meant hiring a CPA and other team members with financial backgrounds. “That is one of the best pieces of advice to give to entrepreneurs: Stop beating yourself up if you’re not good at it and find someone who is,” she says.
It’s OK to love work—as long as you remember you’re a human.
Having dominated entrepreneur culture for the early part of the 2010s, the Girl Boss has been knocked off her pedestal in favor of work-life balance and work-free weekends.
Lisa has mixed feelings about this. She proudly took part in so-called hustle culture, working all hours to build her business. She still enjoys digging into work on a Sunday. But the COVID-19 pandemic showed her that she could afford to slow down a little, too. When all the things that usually kept her busy—meetings, networking events, spin classes—were shut down, Lisa struggled to even know what to do.
Lisa’s not ready to say goodbye to her Girl Boss roots yet. It’s how she got where she is today. “You’ve got to hustle because you’ve got to make it,” she says. However, she’s looking for ways to relax that don’t involve her now-beloved spreadsheets. “You can’t just be by the pool with your laptop, either. It’s a weird time for business ownership,” she says.
Know your worth and stand by it.
When you’re building a business, it’s tempting to say yes to any job, even when the client is offering well below the rates you want. In her early days, Lisa would take on projects just because she thought they were fun and would look good in her portfolio. But eventually, she realized this was devaluing her business as a whole.
When she was forced to face her financial situation, she realized that accepting lower fees was not only insulting to her own creative abilities, it was damaging her company. If she kept basing her fees on her impulse to please clients, and not on what she knew she was worth, she wouldn’t be able to afford to run the business any more.
Standing by her higher-than-average fees has actually helped Lisa make money. It weeds out clients who can’t afford her services and ensures she only works with people who understand the value of what she does—and are prepared to pay appropriately.
Having spent 10 years building up her own business, Lisa understands that bank accounts don’t fill up overnight. She hopes that even if would-be clients can’t afford her right now, they might come back in a few years. “Maybe I’m not in your price market right now, and that’s OK, but I want to be a goal for you,” she says.
Face your finances head-on.
Years after her own financial reckoning, Lisa has advice for entrepreneurs who want to get to grips with their finances and individuals who aren’t meeting their money goals.
Every Friday, Lisa’s Director of Procurement compiles a report that details all of the income received Monday through Thursday and how the money is being divided between different bank accounts within the business. For example, there are separate accounts for taxes, operating expenses and cost of goods.
Lisa says that this breakdown makes it easy to take into account her margins and understand profit and loss better. She can quickly see how much money she can make designing and installing a bathroom, say, versus a bedroom, and if splurging on a high-end product ate into the profits.
Lisa is such a finance convert that she now helps her friends get to grips with their own spending habits and goals. She recommends printing out—yes, the old-school way—three months’ worth of bank statements and categorizing what you’re spending money on. Maybe you’re buying more lattes than you realized, or those online shopping sprees are starting to add up.
From there, separate your money into bank accounts for bills, rent, groceries and personal expenses. The first four months of this are tough, Lisa says. But eventually, you’ll realize you’re making more money than you realize.
“Prior to doing that, you think, ‘I can’t afford this, I can’t do that.’ But once you really start paying attention and seeing where certain money is going, or how you’re misallocating things, you’re often like, ‘Oh wait, I can afford it, I’ve just been ignoring it,’” she says.Internet Explorer Channel Network