1319: Better Numbers: Crush Your Accounting Fears in 30 Minutes with Licensed Accountant Chris Hervochon

Robert Plank 0:01 Hey, welcome back. Are you a growth minded entrepreneur? Are you in perhaps the marketing or creative agency space? And could you use a little bit more of advice on money and finances, etc, from a CPA and a CVA? Well, we're exactly in the right place here. We're here talking to Chris Hervochon from better numbers, dot CPA. Who knew that dot CPA was a domain suffix. It's amazing, but they keep inventing, and we're here to talk about better books, better taxes, better decisions. Mr. Chris, he is all about helping growth minded entrepreneurs with bookkeeping, with tax and advisory. So we're here to have that conversation about your goals, about your cash flow, about your financial data, a strong foundation, and so much more. So Mr. Chris, glad to see you. Glad to talk to you. Thanks, likewise. Thanks for having me. Glad to have you. And so you know it's all about you, and what currently has you, excited, energized, focus. So what are you all about? What's What do you what's on your mind these days?

Chris Hervochon 1:04 What's on my mind these days? That's a good question. So there's been a lot of change that's happening in the accounting space, around technology and AI. So that's one of the things that that I think about in our firm quite a bit. Another thing I think about in our firm quite a bit is, how do we make it an easier place? Easier place to work? And then the third thing that I think about a lot is, How do we create and communicate incremental value for our customers? So how do we help our customers create better businesses? And that's really what we obsess over,

Robert Plank 1:38 very nice, and I think you're so right that it's, it's as nerdy, as geeky as it sounds to say, oh, there's, there's new things happening in accounting. It's like, I didn't I took for granted, early on being a business owner, how important it is to get your numbers right and to also be timely. And it seems like, especially with the cloud and AI, there's this need for things to be real time. That way, you just kind of look at things at a glance. And when you look at there's, there's basically two types of people, right? There's people that are, are bad with numbers, are bad with money. And what does that mean? It means that the money just goes out the door right in their personal life, in their business, they don't know even what the ins and the outs are. They're afraid to look at that bank balance. And then you see again and again, people that they seem to like, love money in whatever the healthy fashion that is. And they're fine, like looking at the bank balances. And you know, something that completely changed my view on all this, Mr. Chris was I was afraid to, like, open up my bills, like, 1015, years ago, I was like, oh, no, what's in there? And then I came across someone that said, like, he would, like, kiss his the envelopes one at a time, kiss his bills. And I was like, well, that's a silly reframe, and it's like a better way of looking at it. And so how do we tap into this number money mindset? How do we get excited about accounting and finances and payroll and all that stuff.

Chris Hervochon 3:06 So I, I don't think that anybody's necessarily bad at money, but one of the things that you touched on was being afraid of it, and I think that's what we see more so than not. It's people are just afraid of it either because, you know, maybe they had some sort of a bad experience in high school algebra, or maybe they had some sort of bad experience in running a previous business, or maybe they're just scared of what they don't know, and that's what they try to avoid. So we need to bridge the gap from that to how do we take those numbers and take those insights and then just make it more approachable, and then tie that into this is the benefit that you are going to have inside of your business. So if you know this, and then if you're able to make this decision based on this, this new thing that you now know, how is that going to impact your business? How is that going to impact your employees, how is that going to impact your customers, how is that going to impact your family? How do you turn this into a better business? So really, just kind of breaking down, breaking down that gap. As far as this is a thing that I'm afraid of, and I don't want to touch it to the benefit of, you know, I can now make these decisions based on this good data that I have, and just make it more approachable. So, like, one of the things that we talk about a lot is talking about a lot is numbers on a page. And we don't want to just throw a P L at you, or a balance sheet or whatever, and just have it be a whole bunch of numbers on a page. You don't really know what it means. Nobody's ever really explained it to you. You probably didn't go to college for accounting, right? You You're you're in business because you do this thing that you're really good at and you like doing it, not necessarily because you want to be doing the bookkeeping or that you have this have an accounting degree. People who have accounting degrees, they go and become accountants. They don't become, you know, generally involved in other businesses. So, you know, just realizing that this is a barrier for people, and then breaking down that information into either bite size nuggets or presenting it in. A different way. So it's not just numbers on a page and having a discussion about it and what, what things mean. Maybe showing it graphically, maybe just showing it in KPI form, maybe not necessarily showing it a female form, just depends on the business center, but just understanding that that's where that comes from, and then that's that's the way that we need to approach it in order to turn it into actionable insight.

Robert Plank 5:19 I like it. So there's a gap to be crossed. There's that saying that everything you want is on the other side of fear. And you're saying that, well, it's not just about the numbers. It's then what the numbers will then lead you to, right, what the decisions are to be made afterwards. And you think, like, even in like a to simplify it, like a household situation, you say, Well, I'm afraid of budgeting or all that. But it's like, yeah, but if you budget, then you can go to Disneyland. You could take the family on a vacation. In your business, you're afraid of looking at the cash flow and the money and money out, but if you have that figured out, maybe you could hire some employees. Maybe you could make some, you know, take time off. Maybe you could, you know, get higher ticket clients. There's all these possibilities on the other side for you. And you know, you say that the money fear might come from a childhood, and then I think that we can all kind of flip that around, and we can think about our childhood and think about like, Well, remember, like Hooked on Phonics, or remember, like our Schoolhouse Rock or like playing the video games and getting the high scores. Like, sure, there might have been those traumatic money experiences. Maybe our parents fought over money, but maybe we also had fun. Like, I remember in school the like, learning about different types of coins, and there was, like, the little paper quarter and the paper nickel, I might have been, like, four years old. So it's like, it depends on what you what you decide to tell, what story you tell yourself, and what you think about it. And so when, when someone comes to you as Mr. Chris, Hervochon, CPA and CVA, like, what's your typical client and before picture, like, where are they stuck by the time they come across you?

Chris Hervochon 6:56 So usually it's going to be one in two places where they're stuck. The vast majority of folks are going to come to us because it's either they don't hear from their accountant, or they don't have a relationship with accountant, an accountant somewhere like that, but it's usually because they just don't hear proactively from their account. That's by far the number one reason why people come to us. And if you kind of think about what I just said a couple minutes ago, and it's just kind of breaking down that silo. They don't have that person who's there to advise them and explain the numbers to them and walk them through what's actually going on in their business. So that's that's the biggest one. A smaller segment of the folks that come to us, they're going to be newer business owners. Maybe they've been doing their own their own bookkeeping, maybe not, but they're at a spot where they know that either the volume or the complexity is just too much, and they know that they need help. So you know, both groups are fun to work with. It's just a it's just a matter of where they're at in their in their life cycle. So really, you know, from that point of view, what we're really trying to do when we get either of those groups on board is just figure out, okay, this is where you are right now, where are you trying to go? And then help them to build that roadmap from here to there. Wherever there is doesn't matter where there is, but you know, there is going to be specific for each for each business owner, it's what success looks like for them. So how do we help to help them navigate that roadmap from wherever here is to wherever there is,

Robert Plank 8:29 very cool, and you know, you're sort of subtly pointing out two ways to stand out in business in general, right? You say number one, be that proactive person, and that applies to any space. Right? You figure like, Okay, how do I stand out in the weight loss space? Well, if there's all these weight loss apps and coaches and everyone else goes and hides, if you're the person that proactively goes and and and, you know, helps out your clients, hey, that's the way to stand out. And then the accounting space, there you go. And then the other field, you say, is in making the complex, simple. If someone is handling something theirself, then you know, you can do a lot of things yourself, right? You can fix up your own home, handle your own tenants if you're renting real estate. But any of these businesses or situations gets big enough where it's like, hey, you know, at this point I'm I'm tired. It worked for a while, but I have better things to do, or I just to keep the momentum or keep the growth. I need some outside help. I need someone like Mr. Chris and better numbers dot CPA to get a better handle on on these things. And, you know, two years ago, or two months ago, I was talking to someone who kind of was a number nerd. And I love what she said, she said something like, she meets with her accountant once a month, and they just kind of go over the numbers and make sure things are great. And she just, I think she pays like, like 100 bucks a month. And I'm just like, man, like that. But 10, when I was 2030 I would have hated that. But now that I'm 40, I'm like, hey, you know, having gone through things the hard way, i. Like, I kind of like the idea of being more proactive and having sort of a, I mean, partner in crime. Doesn't sound good when you talk about, like, money, but, you know, like a partner, yeah, partner in fill in the blank to kind of just help you to make decisions and work out problems and to see what story The numbers are telling you. So in spirit of that, when, when you come across someone in one of these two spaces, and you just, you know, you make some change happen. What usually happens? Like, what do you usually do, as far as getting things dialed in, getting some up to speed, on the on the software, like, what do you put in place?

Chris Hervochon 10:36 So software is one of the first things we put in place, what we're looking for in terms of software, is a connected ecosystem. So what that means is that the hub is going to be your general ledger. You can think of your general ledger as something like QuickBooks or Xero or FreshBooks, whatever it is that you would typically think of as your bookkeeping or accounting software that's going to be your general ledger. So what are the things that connect into the general ledger, and we're talking about things like payroll your bank account. How well does your bank account play with your general ledger? Bill Pay, software, analytics, software, forecasting, software. You know, the list goes on and on and on, but we're very specific about our GL because we want to make sure that we're playing in the best ecosystem. So that's number one that creates a whole bunch of efficiency and it breaks down those data silos that are inside of your business. Siloed data is not that's not a good thing. We want all these things to be connected, so we have a holistic view of what the business is actually doing. So that's the first place that we start, you know, where we really kind of help people. The biggest one, I would say, is in preparing to sell. We've had quite a, quite a quite a few customers in the last couple of years who have been preparing to sell their business, and so helping them navigate that, so that they get the top dollar out of that. You know, that's that's helpful fixing cash flow issues. A lot of times, business owners come to us and they, you know, they're cash strapped, so they're working really, really hard, and they're not seeing a whole bunch of benefit in their bank account. And so they just think, well, you know, if I just work harder, then I'll I'll have more money and I'll be better off. That's not always the case. Managing Cash Flow is super important because it creates a whole bunch of other benefits. It helps you to hire that next employee, or it helps you to not have to work as hard so you can spend more time at home with your family, whatever it is that that looks like for you. Usually the cash flow is going to be the symptom. It's not going to necessarily be the cause. So getting to that root cause and fix it, fixing that cash flow problem, profitability, that's another big one. Just making sure that we're getting the most out of the business that we possibly can. That doesn't mean that we're greedy, or we're cutting corners or anything like that. It just means that we're optimizing the cost structure and the revenue structure so that it's, it's optimized for your business, so you're getting the biggest bang for your buck, for the investment and the time that you're putting into your business. So really, I think it's kind of those, those three things, it's, if you had to distill it down, it's getting the most, the most out of your business, as far as a financial gain for you, it's freeing up time for you, helping you to scale. And then also it's, you know, helping you to sell at some point, helping you through that exit process.

Robert Plank 13:13 Very nice. And that a whole end point there of selling a business. It's always exciting. Like, I'm sure you can imagine Chris, like, I've talked to 1300 different entrepreneurs, and it's like, like, what's the most exciting outcome? It's like, selling that, that company, and then getting money from it, and then buying a new company, or starting a new one, and just kind of going through these, these huge leaps and bounds in your lifestyle, right?

Chris Hervochon 13:36 And so you're saying that also the curious too.

Robert Plank 13:39 It's what now?

Chris Hervochon 13:39 it's the most exciting, and it's also the scariest point.

Robert Plank 13:42 Yeah, exactly. And it's scary to even like, like, think about like, oh my gosh, I have to have my finances in order. And it's this, this, like, really irreversible decision. And so you're saying that the first step in all this is to figure out your source of truth, right? Your general ledger, your GL, you say, well, what's the one hub where all the numbers go into place, the one place I can look that way. I'm not just like, kind of dumping and exporting and putting all this together. We've all been there at some point, right? You have to, like, merge spreadsheets. It's never fun. You have your one singular, your zero, your your QuickBooks, your fresh books, wherever you go, and you look and then you think, Okay, well, what's the this entrepreneurial journey all about it's like fixing up your business, right? Getting other people to do the work that way, you kind of can elevate your your presence in your hierarchy, right? You don't want to build yourself a new job, maybe, if you do that, temporarily, fine, but you want to eventually, like, get someone else to run it that way. You can focus on more of the publicity, like the podcasting that we're doing here, and then get to the point where you find a buyer. And then that way, either you are in a great position where you have a business that, like, runs itself and you don't even want to sell it, or you do want to sell it, and hey, that opens up some real life choices and possibilities. And so what do you think holds people back? Right? They find you. Which is a great thing to do. You get them figured out with the software and this new mindset, and you make them aware of some problems. But you know, success is never a straight line. So what happens along the way? When you do this work for companies like, where do you think they might get frustrated or stuck?

Chris Hervochon 15:20 Um, the most common place where I think that folks get stuck is they get very head down in the business, and they don't have that 30,000 foot view of how do I get myself from being head down and just being another cog in the wheel, or being the bottleneck in the business, or being the the person that everybody comes to with a question, how do I get out of that and then turn it into, I am the business owner, and I'm helping to basically move this ship forward. I think it's really, really easy as an entrepreneur to get stuck in the business as opposed to working on the business, super, super easy. I think that that's, I think that's where it starts. You know, ways to get out of that are proactive planning. You know, the number, the number of customers that come to Boston that don't have a budget. You know, something as simple as a budget or a business plan. You know, it's shocking. So, you know, even just starting from a from a good spot of I have a plan, I have a budget. I know that in order for me to get from here to there, I need to do X, Y and Z, and I'm going to measure my progress along the way. Just like having a GPS right in your car, you're not going to go take a seven hour drive anywhere without having some sort of GPS in your car hardly at all anymore. You know, your business works exactly the same way. So you have no GPS. You get in there, you get head down, you're not focused on the bigger picture, then before you know it, it's five years later, and your business hasn't really moved forward. You know, we've gone through an economic cycle, and maybe your business isn't as profitable as it was, and you're just kind of, you know, your head spin and you're like, Well, where did I go wrong? And I think you just have to back up and take it, take a bigger picture, view of it sometimes, and go from there. But I think that's where, I think that's where most entrepreneurs get stuck. It's just being head down and and being focused in the business, as opposed on the business.

Robert Plank 17:10 Yeah, 100% and it's like, like, the there was a maybe, like one or two recessions ago, there was, you know, like, when you're younger, you're stressed out about world events. And you think, oh my gosh, how will this affect me? And then you wonder, like, well, how seriously do I take it? And was the, is the apocalypse going to happen? Well, no, but like, what, what might happen? And like, so maybe one or two recessions ago, something came up about, like, Japan's lost decade. And they were like, well, is, is the US going to have something similar to that lost decade? And just made me think about, like, my own situation, and just like, well, you know, that's, that's not a good place to be like, you think, well, is, you know, if, if I don't have my numbers dialed in, well, is my, is my business going to collapse? Will I become broke, homeless? Well, maybe not. But this idea of 510, years passing, you're still in the same spot. You have whatever the Lost decades for your own business, that's like, kind of not really what you want, right? Because then you're older, you can't get the time back, different responsibilities. And it's just like, that's not why we got in business, right? You wanted the the variety, we wanted the adventure, and for like, just the sameness, that's not a good place to be. And so we want to to be better. And it seems like, like, as you're explaining all these things to be done. It seems like it boils down to, like, communication and leadership, right? It's like that you need to get good at writing down what you want and this business plan and what you're working on, and like document for others. And then there's the need of communication, or like, numbers wise, and like, kind of figure out the finances, and then you and then that kind of leads to you mentioned about like, this sort of time management bucket and like strategy, priorities and like steps, deadlines, milestones. And these are all things that like, maybe we've heard separately, but to like, like, put it all together. It can really be a recipe for us to like, as we've been saying, be more proactive. And like happen to life and happen to digital marketing instead of it happening to us. And so it's definitely a new mindset that we need to adopt versus what we've been doing that got us here but won't get us there. And as far as what we need to someone needs to know, as far as being ready for you or working with you on some better numbers. What question Am I not asking you in our conversation here? What should I be asking you? I just don't know to ask you.

Chris Hervochon 19:33 That's a really good question. Actually. You know, for somebody to be ready for us, they just need to be. They need to be a little bit open minded about their financial situation, which basically means that they need to want, they need to want help, right? Our best clients are the ones who want help. Our worst clients are the ones who don't. Because good accounting cannot happen in a silo. It's just not, it's not possible. We we can't. Sit, you know, in our office and not have the context about you and your life and your business and how you're operating, and also do great accounting and be a great advisor to you. It's not possible. So having that open mind, being willing to get help, that's probably the biggest thing. And, you know, just let the professionals do their thing. So whether it's accounting, we see this a lot in legal too, because we're kind of on the other side of legal stuff. You know, when, when folks want to go and chat GPT their their operating agreements, or their LLC formations and that whole thing like that, that can go sideways too. Same sort of situation, you need to be open minded and be willing to, you know, ask professionals who are really good at what they do for help, and then have those people talk to each other too. So you've got kind of this team of advisors, and then that will, that's the place that will help to start getting you moving forward. But you have to be willing to have a conversation,

Robert Plank 20:56 very nice so, and you've been saying in a few different contexts, siloing is bad. Holistic is good, and we need to be more open minded and willing to change our ways and willing to ask for help. And then you're also shining a little spotlight on the AI and chat GPT of it all, where, like, I hear this a few times, that chat GBT is good for filling in the gaps. But, like, don't just say hey, chat GBT do all this for me. Do all this operating agreement, but it seems to be good for like asking questions or finding the problems or the holes in your logic, knowing that well it can point things out, but you don't blindly trust it, and it might help you to know what you don't know. And then you can ask your CPA or your attorney about about it, but it's don't, definitely don't use it to drag your business. Use it as someone who is helping you out. And so as far as someone actually taking this next step, right? You've given us a lot of great advice. You told us how we can change our ways and change our thinking. And what is the criteria? What are the pre qualifications for someone contacting you and getting your help?

Chris Hervochon 22:01 Yeah. So like, the perfect client for us is going to be a business owner, like, we're fairly large in the professional services space, business owners that are generally somewhere between 500,000 and 5 million in revenue, usually somewhere between three and 10 employees. That's, that's really the that's really our niche. That's that's the space that's good for us. We do have a fairly specific tech stock that we use, so just having an open mind about technology is great working with us too. And you know, if anybody's ever interested, you can find us on the web. Better numbers. Dot CPA, it's great way to, great way to find us on our website.

Robert Plank 22:37 Very nice. So we said better numbers. Dot CPA, if you're that kind of business, that you are 500,000 to 5 million in revenue, three to 10 employees, then Chris would love to have this conversation with you. He is a bookkeeping, tax and advisory company for growth minded entrepreneurs, and that's better numbers. Dot CPA, where they can just talk to you and help you out about some of these ideas, accurate, reliable bookkeeping is the foundation of your business success. Strategic tax planning and preparation save you money and headaches, and if you understand your financial data, you can make informed business decisions, and that's better numbers. Dot CPA, we've been speaking with Mr. Chris Hervochon, but before I let you go, Mr. Chris, it's time for the scary part of the show where I try to make you completely blank out. Be a dear headlights, be totally on the spot. It's where I ask you for a quote or lesson that has served you that you can pass along to us. So what do you have for a quote or lesson?

Chris Hervochon 23:39 Yeah, so the lesson would be, just be helpful. And that was a big revelation for me. Several years ago, I read a book called getting naked. It's about it's essentially, it's about advisory. And so I read that book, and really it the whole premise of the book is, just be helpful. Just be helpful to your customers. Just be helpful to your employees. Just be helpful to the to the folks who are around you. And it's a total game changer. So that's actually our purpose, cause and passion. If anybody who's listening is familiar with Eos, that's our purpose, cause and passion inside of our firm, and it's just be helpful,

Robert Plank 24:13 very nice. Just be helpful. I think it's John Rockefeller says if you help everyone get what they want, then they will help you get what you want, or something along those lines. And entrepreneurs, business owners, it's all about solving problems, so just be helpful. And that applies to you and your business, but it also applies for Mr. Chris, helping you out with your finances, with your numbers. So better numbers. Dot CPA is the place to go to get help, and then on LinkedIn, we'll have a fun in a second spelling out his name. That's H, E, R, V, O, C, H O, N, Chris Hervochon and it's always great to connect with someone that you heard on a podcast, because they're real people, right? It's not like you turn on TV and you see characters on like a doctor, a lawyer. Dollars. Mr. Chris. He loves numbers. He loves getting all these problems solved. He loves getting your accounting, bookkeeping, payroll issues figured out. That way you're you can un bottleneck yourself, as he's been saying, and get to grow and get to selling and get to possibilities and get to the lifestyle design that your business was supposed to be. But sometimes you get off track. It's okay. Chris can get you back on track, because he believes in just being helpful, and you can find out more about him at better numbers. Dot. CPA, go ahead, do it right now, bookkeeping, tax and advisory for growth minded entrepreneurs. You go there. There's a button there. It says, Get in touch, and you can have that conversation and discuss possibilities. So Mr. Chris, it's been a blast speaking with you getting dialed into this new way of thinking and taking action. Really appreciate you being here and educating us

Chris Hervochon 25:51 Likewise. Thank you so much for having me.