Engineers: Build Your Business on Solid Financials

Key Concepts:

• Confidence in starting a business despite an engineering background
• Importance of financial management
• Role of an accountant
• Business plan
• Monthly financial review (accounts receivables, accounts payables)
• Project management experience as preparation
• Importance of accounting systems

Confidence and Business Acumen:

The speaker addresses the question of how they gained the confidence to not only excel in engineering but also start a business. The key takeaway is that while engineering provided a strong foundation, the financial aspects of running a business required a different skillset and approach.

Financial Management and the Role of an Accountant:

The speaker emphasizes the critical importance of financial management. A key decision was to engage an "excellent accountant" from the very beginning. This accountant was involved in all aspects of the business, including business development and monthly financial reviews.

Specific Financial Aspects:

The speaker highlights specific financial areas that require constant attention:

• Accounts Receivables: Managing incoming payments and ensuring timely collection.
• Accounts Payables: Managing outgoing payments to suppliers and vendors.

Project Management as Preparation:

The speaker credits their experience as a project manager on "major projects" as crucial preparation for managing the day-to-day operations of a business. Project management experience provided skills in managing invoices, accounts receivables, and ensuring timely payments.

Systems and Accounting Systems:

When the company was launched full-time (after starting in 2007), the speaker prioritized establishing robust systems. A key point is the emphasis on ensuring that "accounting systems are in" place. This is presented as a fundamental requirement for anyone in business.

Conclusion:

The speaker's confidence in starting a business stemmed from a combination of engineering skills and a proactive approach to financial management. Engaging a skilled accountant, focusing on key financial metrics (accounts receivables and payables), and leveraging project management experience were crucial factors. The establishment of robust accounting systems is presented as a non-negotiable requirement for business success.