S5E32 – 5 Hot Financial Tips for Startups With Chris May

• (00:47) – Show intro and background history
• (02:02) – Deeper into his career journey
• (03:55) – Understanding his business model
• (06:46) – Deeper into his business vision and  strategies
• (13:53) – Some lessons learned in his journey
• (15:17) – Commercial break (TYKR mobile app)
• (15:59) – Chris’ thoughts on AI and the current market
• (17:41) – How should entrepreneurs organize their financials
• (23:57) – Deeper into his marketing and teamwork vision
• (29:03) – Guest hot tips
• (32:12) – One more key takeaway from the guest
• (39:02) – Guest contacts

Transcription

[00:00:00.000] – Show Intro

Introducing Payback Time, the podcast for entrepreneurs looking to build and scale their startups, gain access to actionable tips, proven strategies, and valuable data that can help you avoid mistakes, skyrocket sales, and optimize profits. Your business breakthrough may just be an episode away.

 

[00:00:17.640] – Guest Intro

Financial mistakes can prevent you from scaling your business. They can hold you back from raising capital, and they can even cause you to go out of business. My next guest has an advisory firm that does a financial heavy lifting, so business owners can focus on building their business. In this episode, he breaks down five financial tips that can position your business for success. And state of the end where he shares a case study on how his company helped a startup raise an additional $4 million without giving up equity. Please welcome Chris May.

 

[00:00:47.590] – Sean

Chris, welcome to the show.

 

[00:00:49.250] – Chris

Hey, Sean. Thanks for having me.

 

[00:00:51.030] – Sean

Thanks for joining me. So before we dive into the finances around building a startup, if you could tell us something unique about yourself that most people don’t know.

 

[00:01:00.250] – Chris

Well, I enjoy getting outdoors. I grew up in South Louisiana and fishing all over that area of the US. And I once caught a 500 pound marlin. Whoa.

 

[00:01:12.830] – Sean

Okay.

 

[00:01:14.370] – Chris

Yeah, it was pretty intense.

 

[00:01:16.410] – Sean

Okay. So I do enjoy fishing myself. I don’t fish that much. But the two fish out there I know people are always striving for are if you live up north, you know what I’m talking about? Musky. Yeah. Number two would be marlin. Five hundred pounds. Whoa.

 

[00:01:32.490] – Chris

Yeah, it was a beast. It took about five hours, and I actually had to take a few breaks, but I hand it to the deck hand just to get my breath and come back at it. So it was a battle, but it was a very cool experience.

 

[00:01:44.980] – Sean

Was, sorry, a location that was off the quays, or was this Atlantic side or Gulf side?

 

[00:01:50.360] – Chris

So this was actually off the Costa Rica, Pacific side.

 

[00:01:54.170] – Sean

Okay.

 

[00:01:55.640] – Chris

Yeah.

 

[00:01:56.420] – Sean

Wow. Good for you. Very rare catch.

 

[00:01:59.310] – Chris

Yeah, that was neat.

 

[00:02:01.330] – Sean

Well done. All right, well, let’s dive into business a little bit here. If you could take a few minutes and tell us about your career background.

 

[00:02:09.200] – Chris

Yeah, sure. I graduated with a degree in finance and economics, and my grand plan was to go to New York and really get into that investment management space. I was fortunate enough to get a job at a hedge fund right out of college, and I timed it perfectly in June of 2008 is when I started, and about three months later, that whole world was in complete turmoil. The hedge fund that I worked at ceased to exist by the end of that year. So there’s some pretty big lessons learned there. And I was unemployed for a few months and pivoted towards corporate finance. A lot of companies were looking for some help on the finance and accounting side of just making sure that their day to day operational finance was in order. I ended up getting a job there in Washington, DC in that capacity, went through several different jobs from staff accountant through controller and eventually CFO at a small consulting firm there in Washington. And while there, I had the thesis to start my company that I run today, Quadrant Advisory, wherein businesses from inception through pre-IPO, they need accounting and finance leadership one way or another.

 

[00:03:28.050] – Chris

They’re not always going to and need to build that internally. They have their resource constraints and competitive things that they need to focus on on their core competency. And so that’s where Quadrant comes in. We act as an outsource partner and fractional CFO partner for growing an emerging companies. So that was about eight years ago that I started Quadrant, and it’s been quite the journey and looking forward to talking a little bit about that and some of the things I’ve learned with you today.

 

[00:03:55.420] – Sean

Awesome background there. I appreciate it. I just want to get a little more lay the land with your business. Thank you for giving me the length. It’s been around eight years. How many people in the company now?

 

[00:04:05.140] – Chris

About 30 people.

 

[00:04:06.390] – Sean

Wow. Nice. 30 people. And then what target revenue range do you like to work with? Low-end to high-end?

 

[00:04:16.460] – Chris

Yeah, it’s a different answer for venture-back and non-venture-back companies. Okay, sure. And so if you’re talking non-venture-back companies, usually that 5 to $50 million range is when we would come in. And the reason being, smaller than that, you can get away with your traditional bookkeeper or founder-led accounting or finance or a little bit more of a lean operation. When you need to professionalize your accounting and finance operations, that’s where we come into play. If it’s a venture-backed organization, we’re usually looking at a seed two or a pre-A round where we can add the most value.

 

[00:04:55.740] – Sean

Got it. Okay. You know what? Now that we’re on that subject, some people are going to ask the question, what the heck is… You got pre-seed, seed one, seed two. Could you give us your definition of those different benchmarks?

 

[00:05:08.630] – Chris

Yeah, sure. So the way that I think about it, let’s just focus a little bit on the earlier stage for this conversation. You have your pre-seed, and that’s typically an idea. You have this concept, and it’s a PowerPoint, and you want to raise typically some friends and family funds to test that idea. You’re successful in that, then you go to test that, and you’re looking at how your product can get some traction. It doesn’t have to be critical mass, but some product market fit. If you can pass that test, then you’re going to raise a true seed where you might bring some outside investors in that are beyond your friends and family, but not necessarily institutional yet. Now, institutional has gotten a little bit more into that seed stage in the last 10 years or so, but historically, it’s not yet institutional money. Then when you hit that seed realm, you are further expanding your hypothesis of product-market fit for your product. If you can hit what I call critical mass, and that varies for certain companies and whatever their audience and product is going to be, then you can raise your A-Round. That’s when real institutional venture capital firms can come into play.

 

[00:06:21.060] – Chris

You’re most likely going to form a board and really have that next phase and iteration of your company. You found product-market fit, and now it’s about growing and scaling. And after that, your Series B, C, D, E, however long it takes, and you can decide if you want to stay private or go IPO, and all that’s going to be dictated by investors and management and key stakeholders within the company.

 

[00:06:46.510] – Sean

Got it. Well, let’s drill into your services a little further, and then I want to get to the heart of the conversation, which is some of the lessons learned, mistakes made, and some of the things you’ve seen entrepreneurs do or what you’ve helped them do to really help move the needle from a financial perspective. So, yeah, why don’t talk about what do you do specifically tactically for your customers?

 

[00:07:09.830] – Chris

Yeah. So our services are broken down into three different buckets. The first, we call managed accounting or just outsourced accounting. And that is your daily blocking and tackling of the accounting operations. Doing your bookkeeping, doing your receivables, your accounts payable, making sure that your revenue recognition is done properly properly, making sure that your payroll journals are set up properly, all of the month-end close reconciliations are done properly, timely, and in a way that you can have fidelity in those numbers. The next step we call controllership, and that is you’re setting up internal controls. Maybe you have an annual audit that needs to be undertaken, and so we will liaise with the external audit team to make sure that’s done properly. A little bit more sophistication on the reporting package that gets done at the end of the month, or if there’s a handful of KPIs and items that need to be looked at and put in place, budget versus actuals, things of that nature. That’s the controllership function. And then next, you have the fractional CFO, much more strategic in nature. The way that we think about it, if you can put it in a time spectrum of accounting and controllership, it’s what’s happening here and now and historically.

 

[00:08:23.450] – Chris

The CFO is what’s taking the here and now and that data and what can happen in the future. How do we make capital allocation decisions? How do we look to extend our runway and manage our burn rate? How do we invest and reinvest the cash flow to get the best return on our invested capital? How do we talk to our investors and our board on a quarterly basis to make sure they’re getting valuable information as to how the strategy and the execution of the company are doing. And so those are the three main segments of our services. I want to just say one thing, a lot of companies out there that are in my space, you’ll see there’s some terminology differences, and you’ll see fractional CFO, and really it’s a controller or a bookkeeper on steroids, as I call it. And so I want to caution the entrepreneurs and the founders out there, when you’re talking to people who are in this space that I’m in in Quadranton, make sure you’re talking apples to apples because there’s a lot of terminology dislocation of what a fractional CFO is. And if you want to hire a real strategic strategic CFO, it’s different than your bookkeeper or your controller.

 

[00:09:35.090] – Sean

Thank you so much for saying that because there are people throwing around the word fractional, not only with CFO, but CMO and CRO. I’m your fractional CRO, and I’ll get on calls with people and be like, So walk me through what does a day look like? Nothing tactical. Then I’ll be like, You’re not fractional. You’re essentially just a consultant for one or two hours a month. You can’t really call Have yourself fractional in that case.

 

[00:10:02.170] – Chris

Exactly. Yeah.

 

[00:10:04.260] – Sean

Now, I’m going to thank you. As soon as you started going down that road, I’m like, I know what he’s talking about here. That’s good. All right. Well, that’s really good to understand your model that gives the Listener as a framework, gives myself a framework of what does your business do? Now let’s go a layer deeper. And we always want to learn what are some of the lessons learned, mistakes made, and of course, some of the big wins. So can you give us some examples of things you’ve seen, and maybe you’ve come in and helped rectify or make improvements, too?

 

[00:10:37.540] – Chris

Yeah. I mean, the biggest thing that I see, unfortunately, often, is people putting their accounting and finance at the bottom of the totem pole on their priority list. And then we get in there and things are a dumpster fire, and they need the world moved in a very short period of time. A round of capital or funding is dependent on a data room and some due diligence, and it’s garbage in, garbage out for the people that are looking to write checks. And so the information doesn’t make sense, and that’s a travesty. And so as a founder and an entrepreneur, prioritize your financials and your numbers and then the fidelity of your financials and your numbers that you can speak to them or have somebody like a fractional CFO who can sit in that meeting and speak to them confidently, intelligently and back them up. Because when you start to really get some momentum and you’re looking for that real round of capital, that real partnership, or that real joint venture, whatever it’s going to be to grow your business, people are going to need to see under the hood in order to trust and make sure that it’s the right move.

 

[00:11:42.300] – Chris

And so the sooner you get your ducks in a row on your accounting and finances and make sure that you have a good partner that can manage that, the better. And it’s going to stop a lot of headache in the future.

 

[00:11:53.120] – Sean

Right. And I know people think about, Hey, I’ll address that problem when I’m approached by VC Cee or investors. And I’ve seen situations, you probably have two, where now you’re cleaning up, like you said, a dumpster fire. You’re putting out the fire, and there’s duration. It could take weeks. And by that point, the investors could go cold, and they could move on to somebody else. So they lose the opportunity because they did not prepare. They were not clean and organized because ideally, you want to get that email and be like, Hey, we are interested in investing. Can you send us your P&Ls? Send us your financial statements from the last three years. And if you respond back and like, next day, okay, somebody’s got air tight, organized processes. But it’s probably more of the other scenario. It’s going to take a while to put everything together.

 

[00:12:44.520] – Chris

Yeah. And I understand the challenge because as an entrepreneur, when you’re first starting out, you’re wearing many hats, you’re juggling a lot of things. And so I understand that. And if finance and accounting is not your thing, it’s going to naturally slip through the cracks. But I would just implore everybody to think about it as just as important as software development or product development or whatever you’re doing to build your company in that regard. And there’s a saying that was given to me when I was very young, just out of college, that has stuck with me. It’s the five P’s. Are you familiar with the five P’s?

 

[00:13:20.260] – Sean

Not off the top of my head, but if you start going down that road, I might know what you’re talking about.

 

[00:13:24.640] – Chris

But continue. Prior planning prevents poor performance.

 

[00:13:27.820] – Sean

Okay. Yeah.

 

[00:13:28.760] – Chris

And so on my LinkedIn, it says, I live by the five P’s, right? And I feel like everybody should, right? If you fail to plan, you plan to fail. It’s that exact same mantra. Yeah.

 

[00:13:41.000] – Sean

My background is project management, done a lot of corporate prodigment, and it’s that. The failure of the plan is a plan to fail. Over and over, we’d say that. What other lessons learned can you give us? Things to think about that entrepreneurs should be avoiding on their journey.

 

[00:14:01.000] – Chris

Yeah, I would say avoid the splashy thing, what’s in the headlines and what you’re seeing that’s the shiny object at the moment. Focus on what you set out to execute at the beginning of your company. I see very often distractions. Somebody has this idea for a phenomenal platform or product, and the next three months, four months into it, there’s something else that’s sexy and shiny out there that everybody’s talking about, and they want to pivot or add that into their initial concept. And they haven’t fully flushed out whether their initial concept is even worthwhile or going to work. They’re still very early on. And those distractions can really add up and end in the demise of the company if you don’t stay focused on what you’re initially set out to be focused on. And so we know technology moves so fast, and it’s continuing to move faster and faster. And there’s always going to be the next new shiny thing that’s out there. And so my advice is to stay Stay focused, test your hypothesis, test your product. You’re going to want to iterate and move, and maybe you will adopt some of those things that are out there, but be very, very hesitant to do it too early or do it at the expense of your initial thesis and concept.

 

[00:15:18.490] – Sean

Sure. Let’s take a quick commercial break. All right, the Tykr mobile app for both iOS and Android is now live. It includes all the same features as the web app, including stocks, ETFs, crypto, a watchlist, watchlist alerts, so something changes, you automatically get notified, a portfolio tracker, and a confidence booster powered by OpenAI. Plus, it includes learning modules inspired by Duolingo, in this case investing, learning modules to help you get up to speed as fast as possible. If you’re interested, you can go to Tykr. Com. You’ll see the Apple and Google logos right up top, or you can go to the Apple App Store or Google Play Store and download the app for free. All right, back to the show. I I’d love to hear your thoughts on this. This goes back to the early 2000s when people were adding. Com to their name because they’re a tech company. They’re doing that. But a lot of these companies, especially companies going public, really bad financials. Sure, you’ve got a. Com, and now you’ve got a website, but it doesn’t really mean your business. Well, nowadays, you’re seeing people add AI to their business. We use AI.

 

[00:16:25.110] – Sean

We’re doing this with AI. And I’ll talk to a lot of these businesses, and I’ll be like, so what pain are you removing for the customer? Are you reducing time? No, we use AI. I’m like, yeah, but how are you? So rinse and repeat 20 years later, it’s the same thing. I like what you said there is avoid the flashy things. That’s a flashy thing. It gets you off track. You should stay focused on what you’re good at, what pain you remove, and double down on that.

 

[00:16:57.730] – Chris

Well, I think I go back to what is your customer your customer telling you? Is your customer telling you that they need and desire and require some artificial intelligence? Then maybe you look at that and look to maybe invest in it. But if they’re not, then don’t unilaterally just go out because it’s the new flavor of the year. You can do that. And you think you should always be talking to your customers and listening to them. And that’s why I said there might be a time or place to implement whatever that new shiny thing is out there. But AI right now, it’s an arms race, and we don’t really know how it’s It’s all going to shake out. It’s adding value in some places, and it’s nonsense in others, as you alluded to. And so you just don’t know. That’s where I go back to listen to your customers always. Yes.

 

[00:17:40.450] – Sean

Can you talk about, should entrepreneurs, when they’re first starting out, do you recommend they organize other financials in Excel or Quickbooks or another platform? What do you recommend?

 

[00:17:53.310] – Chris

Yeah, we always start with Quickbooks online. And I think that as soon as an LLC is formed, a tax ID is generated and a bank account is open, you should go ahead and open a Quickbooks online file. It’s minimal price to get the essential platform. We’re talking $19 a month, and it’s pretty user friendly. And to my point earlier about staying organized, the sooner you can do it, and even if you’re not formally reconciling, but you’re just categorizing the handful of transactions that you might be doing early on, it’s worthwhile to get that going. So when you do hire a bookkeeper or hire a professional outsource firm like us, the basics are there. So QuickBooks Online is what we like to start with.

 

[00:18:35.680] – Sean

Got it. I had to ask because there are entrepreneurs that are like, Hey, what should I do? Where should I start? So good call. All right, let’s transition to, we talked about some of the lessons learned Any big wins for maybe a strategy or something you did to help a business you’re working with?

 

[00:18:52.970] – Chris

Yeah. There’s a company that we were working with out of San Francisco, Bay Area, not San Francisco proper. And they were creating a next generation radar. That was their deal. Basically, radars that historically were very large, they were using the most recent technology and some proprietary processes to condense that into a very small physical product with the same or more computing power and power as traditional radar systems. And so when we looked at how they were pricing their product and how they were marketing it to their end customer, we saw that there were some major gaps in how their customer was wanting to pay for. They weren’t doing subscription services. They were essentially saying, Let’s give you this radar for free, and then you can pay a usage fee as you’re collecting data in this radar is doing what it’s doing. But we found that if we were able to change the pricing model and actually actually give them a subscription model, the client would sign a much longer agreement as a result of that. Because that’s ultimately the Holy Grail in a lot of these SaaS businesses. It’s that MRR, ARR, contractual recognized revenue.

 

[00:20:16.100] – Chris

When we smoothed out that accrued revenue and were able to acquire more of it because of this small change to our pricing and go-to-market with these customers, it changed the game on what their financials look like. It changed the game on what investors were looking at as far as their financials are concerned. Then secondly, we actually moved them from the Bay Area to Austin, Texas, about two years ago. The state of Texas gave them a $4 million economic development incentive package to do so. And they’re still like a Series A startup, so that’s very material and impactful for them. They didn’t completely close their office in the Bay Area, but their headquarters is now in Texas. And so the ability to be agile like that and go where you are being incentivized to economically was huge. And so changing their pricing structure for their customers, listening to their customers and what they wanted, allowed them to really improve their financials and then moving to a place that gave them some economic incentive, gave them a lot of cash in the bank that they needed and extended their runway by a couple of years, which is huge.

 

[00:21:25.720] – Sean

That is quite impressive. To clarify here, they went from a free plus usage to… Was there an upfront fee plus subscription?

 

[00:21:35.620] – Chris

Yeah, there was a placement fee, and then there are different tiers of the radar that would be used. Got it. Based on whatever tier you were in, you would pay a subscription fee monthly.

 

[00:21:44.760] – Sean

I love that. And I’ve talked about this on the podcast before with other guests, and pricing is one of those things you got to come out of the gate and do right. And I talk to too many entrepreneurs. They’re just like, well, we’re thinking about doing this price, and then I’ll raise They’re going to ask their questions, what if this happens? What if this happens? What if this happens? And then you’re going to make price changes. How will your customers react to that? They may not like that. Yeah, they won’t. And then what happens to your reviews? And it’s just this domino effect of bad things that can happen.

 

[00:22:17.430] – Chris

I think that’s a huge thing that our CFO team does is the scenario and sensitivity analysis around that. And of course, there’s going to be some assumptions that have to go in that, and we’ll work really closely with management and sales make sure that those assumptions are as accurate as they can be. But again, there’s some testing that can be done. And there’s talking to your customer. If we do this, would you like that? Would you not? And if you can get enough people to say, yes, that would sound good to us. We would want that, then you can take the gamble or roll it out if all the numbers make sense on your scenario analysis as well. Got it.

 

[00:22:53.650] – Sean

This is why I asked you the question, what your services are within the business. So within the three, you’ve got the managed accounting, you got the controllership, and then fractional CFO. This definitely falls within that fractional CFO, correct?

 

[00:23:05.510] – Chris

Absolutely.

 

[00:23:06.480] – Sean

Yeah. And with this, just give myself and my audience context here to really do the analysis and arrive on the new pricing. What does that time frame look like? Is that like a two-month exercise, six-month exercise? How long did that take?

 

[00:23:22.000] – Chris

Yeah, 2-3 months. Two to three months. And again, a lot of that comes down to the involvement on the client on the client side, right? Because as a fractional CFO, we get to know the business, we know as much as we can the ins and outs, but we’re not living and breathing it every day within all the different disciplines of the company as well. That would affect the assumptions that are going into this model that we’re building. And so insofar as As far as we’re able to get access to the stakeholders that we need to in order to help form this model, it can be done faster than two or three months if we sprint and prioritize it across all stakeholders.

 

[00:23:56.980] – Sean

Sure. This is one of those, I’ll break the fourth wall here to the listener. You’re in a position where you’re building your business as CEO. Having a team, not just one person, but it sounds like a team Chris is talking about to really own this part. We’re going to own the pricing, find out the best pricing for you. That can be worth its weight in gold because you could be playing with pricing. And I’ve seen this. I’ve seen people play around and sample pricing for two, three years, and they still don’t get it right. It’s like, that’s opportunity cost. That’s a problem.

 

[00:24:28.740] – Chris

Big time. Yeah. Yeah. Speed is important.

 

[00:24:31.990] – Sean

Yeah. This case study is awesome. Do you have another case study you can share with us?

 

[00:24:37.710] – Chris

Yes. Another case study, this is a little bit different in that we had an investor that wasn’t very friendly. Let’s put it that way. You don’t say. They had an idea of how things should go. And unfortunately, they were some of the earliest and most material amount of money in on the cap table. And so Obviously, we gave them the deference and the respect to listen and hear them out. However, they had a myriad of other portfolio companies, and they weren’t on the ground day to day, and they would not hear out what our team was saying is the best course of action. And so resolving investor-relation issues, that’s where I’m going with this. That’s a very tough dance to do when you have somebody that put a significant amount of money in the company and they disagree with management of how the company should be run. And so we essentially had a summit, sat down with that investor and our CEO and founder and COO, head of product, and then one of my CFO advisors on our team, then the CFO advisor called this summit because they’re a third party, technically. That’s another beauty of the outsource fractional model.

 

[00:25:58.710] – Chris

This investor, seemed more receptive when it came from us as the third party CFO than when it came from the CEO and the founder. The reason being, what we communicated was that we’re working with dozens and dozens of companies at a time, and so we see what’s working and what’s not working. We’re able to figure out a playbook in another client that could be applicable to this client. And so this is why we see this can work. And within an hour and 15 A minute phone call, we had flipped the script on this investor and we had the green light to pursue the strategy that we wanted to. I say that because you’re always going to have challenges like that. May not be to that degree, could be a little bit less, could be worse. In in some instances, but when you have a bunch of different people at the table, people are messy. Life is messy. There’s going to be disagreements. Being able to have somebody in your corner who can speak unbiasedly and try to bring these different stakeholders together. You’re really battling for the client, which is the founder and the CEO and their partner who’s a COO.

 

[00:27:08.090] – Chris

But to the investor, you’re an unbiased third party, and you don’t have tunnel vision because this is the only thing you’re on, you’ve got five other CFO engagements that you can speak to what you’re seeing in the market. Was a huge win for us as well to get some harmony going there to execute.

 

[00:27:25.340] – Sean

Yeah, steer that ship out of dangerous waters, you could say. This is very similar to the M&A worlds. You’ll have an intermediate party come in, and they’re not on the cap table, but they care about the customer. So they’ll bring to the table the expertise. We’ve seen this happen, and this happened, and this happened, and based on industry standards and best practice, we probably want to do this, not this. And it’s like, Oh, yeah, I see where you’re coming from. So it sounds like you applied the same formula to to this situation and, Hey, it works.

 

[00:28:03.700] – Chris

Yeah. I mean, communications is so huge. And what we preach at Quadrant is knowing how to communicate the why behind the numbers. There are a lot of accounting firms and finance professionals who are very good tactically at what they do, but their communication skills are not where they should be. It’s hard. You can’t explain it to a five-year-old, then you’re not doing a good job, they say, right? And so we work very hard on that. How do we boil Go this down to where the people that are receiving this information understand it. It’s not too technical on the speak that we’re giving and the why behind it.

 

[00:28:39.900] – Sean

Yeah, that’s not only good for those moments getting out of the dangerous waters, but also when you’re going to raise capital, if you don’t boil things down and make it simple, investors, they’re going to be on the fence, or they’re just going to go down the road and invest in somebody else.

 

[00:28:55.830] – Chris

Yeah. Everybody’s attention span is way shorter today than it was even 10 years ago, and it’s not getting any better. Yes.

 

[00:29:03.690] – Sean

No, this is good stuff, Chris. What I want to do next is do a rollup, and then we’re going to move into the rapid fire round. So I’m going to break the fourth wall here, just roll it up for the audience. I’ve got five hot tips here for keeping tight financials in your business. So number one would be understand the rounds. This is not important for everybody. There are people out there bootstrapping a business, but it’s good to understand what’s pre-seed, what’s seed, what’s Series A, what’s Series B, what’s Series C? So on and so forth. And the breakdown there was really straightforward. You’ve got your pre-seed, which is like an idea. Seed is you’re still getting some investors, not institutional investors like seed, but you’re working on expanding your product market fit. Series A, you really found product market fit. You want traction, and then everything from B and after, you’re just really dialing up, taking it to 11, if you will, to really scale the business. Yes. Number two would be the services. And I love this. This is key for people out there looking for financial help. You’re going to affirm, because I do know a lot of these companies, what are your services?

 

[00:30:12.800] – Sean

What do you call them? And in yours, you’ve got managed accounting, which is straight up bookkeeping. Then you’ve got controllership, which is then mid-tier, and then that fractional CFO, that’s your third tier. We joked about earlier, some people call themselves fractional CFO. They’re not really fractional CFO. You want somebody that can be in in the game tactically in those meetings, doing negotiations. They’re in your best interest. All right. Number three, love the lessons learned here. People who push financials down the road, deal with them later. You’re only setting yourself up for failure. You want to make sure you’ve got things as air tight or close to as possible. That way, when somebody approaches you, you’re ready to go, because if you’re taking too much time to put things together, you’re now unorganized, you’re deviating from things that are more important, like or I shouldn’t say more important, but things like acquiring more customers and scaling revenue. Now you’re spending a full week on financials alone. That’s not smart.

 

[00:31:07.580] – Chris

You’re flying blind, as I would call it. You’re not making informed decisions.

 

[00:31:11.100] – Sean

Yeah, right. Number four is get on QuickBooks right away. As you said, Chris, I mean, their base plan is around $20 a month. I mean, come on, it’s pretty easy. And then number five, I love the two big case studies, the wins here with a radar company. That pricing going from the free to usage, transitioning to a tiered entry price point plus subscription. Brilliant. And then the move from California to Texas. I know a lot of companies you do, too, moving to Austin, Texas, another tech hub now. Or you said it was $4 million they got?

 

[00:31:48.670] – Chris

Yeah. Yeah.

 

[00:31:50.360] – Sean

Yeah. Impressive. Yeah. And then the investor relations issue, which we kept off with, you are that intermediate party coming in. Of course, you’re working for the customer. Where you’re in their best interests, but you’ve got perspective. You got multiple customers you’re working with, and you can quickly raise the flag and be like, Hey, we’ve seen this happen. We’ve seen this happen. You probably want to do this. So good stuff. Before we dive into the rapid fire round, do you have one more good key takeaway you can give our audience?

 

[00:32:19.360] – Chris

Yeah, I mean, I would say, surround yourself with the best people that you possibly can. I think, especially when I was starting out with Quadrant, I sought out people that didn’t really have any business talking to me, to be honest. And that shame less putting yourself out there to talk to people who are further along in the journey or that are interesting or smart or that you feel are interesting or smart is only going to be helpful. And it’s up to you to decide whether or not it’s helpful or valuable or not. But really seek out those relationships and don’t be afraid to, because people want to help each other. That’s just the nature of human beings. And so when you’re out there and you feel as an entrepreneur early on, it can be very isolating, right? And the more you can reach out and connect with others and people, put yourself out there and be vulnerable. It’s almost like dating. You just got to be vulnerable. And I think good things will happen if you do that and surround yourself with the best people that you can. Right.

 

[00:33:24.670] – Sean

You probably read the book Who, Not How.

 

[00:33:27.920] – Chris

I haven’t. I got to put it on my list.

 

[00:33:29.930] – Sean

Well, I think you know that story. It’s who you know, not how you get things done. And you did that earlier in career building your… Eight years ago, building this business is how do I build… I like to He’s a dead dream team from what was it, 1992 Olympics? Oh, yeah. Michael Jordan, Charles Barkley. The list goes on. It’s like you want the best of the best on the team. Yeah, he’s doing that.

 

[00:33:58.280] – Chris

Yeah, it’s huge.

 

[00:33:59.480] – Sean

All right. Let’s transition to the rapid fire round. This is the part of the episode where we get to find out who Chris really is. If you can, try to answer each question in about 15 seconds or less.

 

[00:34:09.020] – Chris

You ready? Ready. Let’s do it.

 

[00:34:10.810] – Sean

All right. What is your favorite podcast?

 

[00:34:12.970] – Chris

The All In podcast.

 

[00:34:14.950] – Sean

Yeah, that’s been recommended a few times.

 

[00:34:17.310] – Chris

It’s a must listen every week.

 

[00:34:18.680] – Sean

Nice. All right. What is a recent book you read and would recommend?

 

[00:34:23.190] – Chris

There’s a book by a guy named Ryan Daily called Right There, Right Now that I’m reading right now. It’s about stoicism and applying the fundamentals of stoicism to your life day to day. And so I read Marcus Aurelius’s Meditations not too long ago, and that really sparked my interest in this as a fundamental philosophy. So I’m digging in a little bit more on that and how to apply some of those teachings day to day to my personal life and professional life as well.

 

[00:34:49.060] – Sean

That’s good stuff. Yes. Love it. All right. The movie question, what is your favorite movie?

 

[00:34:54.230] – Chris

I have two here. Shawshank Redemption is always there. Top of mind for me. And I don’t know. I feel like Goodwill hunting is just campy beats. I feel like those two compete back and forth for me as my two favorite movies.

 

[00:35:12.070] – Sean

Both are a master class in screenplay writing. And Shoshang has been mentioned on the show a few times, but I think that’s a first for Goodwill. But Goodwill hunting, man.

 

[00:35:22.370] – Chris

It’s a good one. I watch it about once a year. And when it first came out to now, I’m 38, almost 39, I’ve been through different phases of life, and it hits different in each different phase. It’s very applicable for different things that they’re talking about or struggling with in that screen player that you’re talking about. The writing is just phenomenal.

 

[00:35:43.690] – Sean

Sure. Awesome. All right. What is the worst advice you ever received?

 

[00:35:49.200] – Chris

The worst advice I’ve ever received. I had somebody once tell me that, this is going to be controversial, that I can do anything Anything that I put my mind to. Absolutely anything that I put my mind to. While I believe that to a degree, I also think that being real with your talents and what you have access to while striving to have more is important to how you figure out your way of life and build your business and things of that nature. Being able to be an astronaut was never going to be part of my equation. It’s just not being on the dream team or a All-Star. It’s just never going to be part of my Equation. And so while striving to be the best version of yourself and to have big dreams is really important and absolutely something that I support. But also being a realist about what that means, I think, is important for everybody to understand as well.

 

[00:36:54.820] – Sean

Yeah, I agree. We’re joking before we hit record about we both enjoy We’re playing golf, but are we going pro anytime soon? Let’s set expectations here. That’s a hard now.

 

[00:37:07.390] – Chris

Yeah. I think it goes to just some of the general culture stuff about the trophies for everybody and things like that. Oh, gosh.

 

[00:37:18.600] – Sean

We could go on on another podcast on that subject. That’s true. All right. All right. Let’s flip the equation. What’s the best advice you ever received?

 

[00:37:29.550] – Chris

Just do it. I mean, and not talking about Nike, but just get started. Just do it and figure it out. I’ve talked about it a little bit today, but when you’re just putting yourself out there and being vulnerable and being as resources successful as you can, people will be surprised how resilient they are and how they’re able to figure things out. Just do it and get started. People think about ideas, and rarely do they execute or act on it. And that’s the difference maker.

 

[00:38:01.150] – Sean

My UI, UX guy on team, Yakub, he’s a rock star. And him and I will talk to other entrepreneurs that are looking to start a SaaS. And there’s so many people that sit on the bench. They’ve got their idea, they validated the market, and now it’s just a matter of deploying capital, start building a thing. And he’s a little younger than us. He said, Why won’t these people move forward? I’m like, Most people sit on the bench. They don’t do it. You have to get after it. You have to do it. So good advice. All right, last question here is a time machine question. If you could go back in time to give your younger self advice, what age would you visit and what would you say?

 

[00:38:40.200] – Chris

Yeah, this relates to the last question. I would go back to age 25 and tell myself, to start Quadrant sooner. I had that idea around 25, 26, and I stalled and sat on it and was insecure about it for about four or five years. I wish I would have started earlier on the that journey. Yeah, right on.

 

[00:39:03.110] – Sean

All right, and where can the audience reach you?

 

[00:39:05.350] – Chris

Yeah, so my LinkedIn is linkedin. Com/chrismaycfo. And then our website is www. We ourquadrant. Com.

 

[00:39:17.010] – Sean

Awesome. We’ll make sure we’ve got the links down below. But Chris, this was awesome. Really appreciate your time. Thank you.

 

[00:39:23.550] – Chris

Thank you. Appreciate it. Had fun.

 

[00:39:25.480] – Sean

All right. We’ll see you. Bye-bye. Hey, I’d like to say thanks for checking out this podcast. I know there’s a lot of other podcasts you could be listening to, so thanks for spending some time with me. And if you have a moment, could you please head over to Apple Podcasts and leave a five-star review. The more reviews we get, the higher this podcast will rank. All right, stay tuned for the next episode. We’ll see you.