Takeaways from #SWNDWomen

Last weekend we were honored to be part of North Dakota Women’s Startup Weekend. There was so much inspiration and innovation. From hydroponic technology to help end the obesity crisis to jingles for your loved ones and more, it was a truly engaging weekend. For the full scoop on the projects and winners, check out Emerging Prairie’s recap.

Here a few of our takeaways from Sunday’s final presentations:

The need for good people. We’re not going to lie. We can’t imagine how stressful and exhilarating it must be to put together a startup in 54 hours. It probably helps when you have good people on your side to help you make your dream a reality.

The same can be true for any startup (not just those built in a condensed timeframe). “The number one difference in the success of a startup is people,” said speaker Mari Baker (learn more about her here). “A good hire makes all the difference in the world.”

Build a culture, not just a business. Yes you have to have a product or solution. Yes, you should probably have a business plan so you know where you’re attempting to go. Yes you should have an understanding of your finances.

But you also need to have culture in place to help drive your company. “Culture trumps strategy every time,” said Baker. It’s important to put it in place early on so that as your startup grows, you don’t lose sight of who you are at the heart of your company.

Don’t forget about YOU. You’ve put a lot of time, effort, blood, sweat and tears into this dream of yours. You’ve worked hard. But along the way to seeing your dream become a reality, don’t lose sight of YOU. According to Baker, one of the keys to success is being able to take care of yourself first. She likens it to the security talk on an airplane: put your oxygen mask on before helping others.

Further, know where your strengths are … and where they’re not. Come on, no one is perfect. Identify areas where you have weaknesses and hire people who have strengths in those areas. A well rounded team who has the ability to learn, adapt and adjust along the bumpy startup way is key to success.

And a few more …

  • Fail fast.
  • Life ebbs and flows. Try to achieve balance over time.
  • Always ask: Who are the smartest people? Work with them.

 

Cheers to everyone involved in _SWNDWomen

 

 

 

Lessons from #SWFargo

Startup Weekend just happened in Fargo. It was pretty inspiring, full of creative ideas to answer real problems facing our community and region (check out the winners here). There was also a raging after party sponsored by some pretty sweet accountants (cough us cough).

Through all the creativity and the party, there were also some lessons learned that we feel the need to impart (we’re nice like that).

Validation is key.

Shane, the Startup Weekend leader/facilitator, made a point of this throughout the presentations. You have to validate your idea before you ever continue in your business. Read, if no one cares about or needs your idea, it doesn’t matter how good your business plan is.

Build a great community.

The beauty of Startup Weekend is how complete strangers can come together around an idea and end up creating a company. Each individual brings their own unique strengths, which contribute to the overall success of the team.

In the same way, this can be applied to our community. Mayor Mahoney recently talked about Fargo with Emerging Prairie (check it out). He discussed how building communities where people want to live, builds a better economy. In other words, when we all do our individual part to create the community we want to live in, we contribute to the overall success of our economy.

Seek innovation.

The creation of new ideas and different ways of thinking is essential for business growth. By challenging the status quo, we begin to think in new ways and expand our sights. The problems presented at Startup Weekend weren’t new (nonprofits, for example, have been looking for funding sources for a long time). But the innovative answers the teams created were new and, hopefully, will change the way we approach things.

We’re seeing this pattern of innovation not only at Startup Weekend, but on a local and state level. In their annual look at innovation across the United States, the Consumer Technology Association named North Dakota an innovation champion for its growth in 2015. We ranked first in the country for entrepreneurial activity. In other words, great things are happening here.

These are just a few of the things we learned at Startup Weekend, and we were only there for the presentations! We continue to be amazed by what’s happening here. So keep reaching, keep innovating and building. With a little validation sprinkled in, we’ll be on the right path to grow our business climate.

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Accounting 101: Setting Up Your Books

Accounting, it’s all about the numbers. That’s what most think, but accounting is really a story. Your financial data (even though it is expressed in numbers rather than words) tells a story of where your business has been, where your business is currently, and where you can go in the future. Accounting is one of the functional pillars of your business; it’s important to get it right … the first time.

Understanding Your Business and Industry: An understanding of your business and industry is imperative to answering several key questions when designing your accounting system:

“What basis of accounting should I use?”

“What information do I need to track to make informed business decisions?”

“How should I track the information?”

Selecting Your Basis of Accounting: Selecting my WHAT? The basis of accounting is the framework used to record your business transactions. There are several different frameworks. The most common include:

  • U.S. GAAP (United States Generally Accepted Accounting Principles) – an accrual based accounting framework in which revenues and expenses are recorded when earned and incurred, respectively. (Recommended)
  • Income Tax Basis – a framework in which recording of revenue and expenses depends on the tax regulations; eliminates the need for converting from one basis of accounting for recordkeeping to another for tax return purposes.
  • Cash Basis – a framework in which revenues and expenses are recorded when cash is received or paid, respectively. There are two different methods of cash basis accounting: pure and modified. The main difference is under the modified cash basis some transactions follow U.S. GAAP (ex. fixed assets are capitalized and depreciation is recognized). Here’s more on cash versus accrual accounting methods.
  • Regulatory – a framework in which a regulatory agency prescribes the method.

Determining What Information to Track: The key is to capture all of the transactions that occur in your business (cash and noncash) in the simplest and most efficient manner.

Speaking of noncash transactions –a common mistake in accounting is not accounting for your trade work. Look for an upcoming blog related to accounting for bartering transactions (trade).

Based on your business or industry, you may need to consider tracking your business transactions in more depth. Below are several considerations (not all inclusive but should give you an idea):

“Should I be tracking direct and indirect costs related to manufacturing or construction contracts so I am able to view the profitability?”

“Do I have different departments, product lines, divisions, programs, etc. that I should be tracking so I am able to view the profitability?”

“Do I pay commissions and should I be tracking transactions, such as revenues, by each sales representative to determine the proper calculation for those commissions?”

“Do I work in several states and should I be tracking transactions, such as revenue and payroll, by state for tax return preparation?”

“What sales tax jurisdiction do I need to track for sales tax reporting?

“Do I need to track certain items such as meals, donations, etc. for tax return preparation?”

Once you figure out what information you need to track, you can select an accounting software solution and design your accounting system.

So what’s next? Check out our upcoming blog about the basics on how to track your financial information.

Accounting System Setup 101

Business Planning 101

Has this ever happened to you? You get in the car, begin your journey and realize you have no idea where you’re headed or how to reach your destination. So what do you do? For some, they keep on driving, assuming they’ll figure it out along the way. For others, they pull out a map or plug their destination into their smart phone and let GPS take it from there. Then, if they still need help, they stop and ask for directions.

The same scenario can apply to starting your business and mapping out where you’ll go in the future. Some people start a business with no clear end in sight or no true direction or course. While this “fly by the seat of your pants” approach can be fun and exhilarating, we’re here to tell you it’s not the ideal way to start and run a business (sorry to rain on your parade).

Rather a business should model itself after the latter group in the above example.  By pulling out a map or plugging in your end destination, you can plan a trip that will get you to the place you want to go. Hopefully, it may even get you there in record time.

This is the heart of business planning, an essential function of running a business. Consider your business plan a roadmap or GPS for your organization. It’s an important step, because it keeps you on track during the early years of your business and gives you a defined destination to reach, as well as keeping you on track along the way. A business plan generally includes:

  • Company description (What is it exactly that you do? What sets you apart? Who do you serve?)
  • Organization (we’re talking the structure of your business and what management looks like)
  • Service/product line (What are you selling? How does it benefit a potential customer?)
  • Marketing and sales (How will you sell your product? How will people hear about you?)
  • Funding (How are you going to get started? Are you asking for funding?)
  • Financial projections (How are you going to make money?)
    • Projections for 3-5 years ahead
    • Yearly milestones (and how you’ll get there)
    • Revenue projections

So now you have your destination. You’re trucking along, enjoying the scenery and gaining momentum. But wait … you’re lost again. Your GPS told you were coming up on a national park and instead, you’re in the Walmart parking lot. Now what?

ASK FOR DIRECTIONS. A business plan is a really great map for your organization and an excellent exercise in understanding not only why you got into business the first place, but where you want to go and eventually end up. However, it’s not a concrete plan and sometimes, you encounter unexpected obstacles (hey, if you could see into the future and predict with 100% accuracy, you’d be a pretty wealthy business owner). So don’t be afraid to stop and ask for directions or help along the way.

Here a few common questions to ask along your business journey:

  • What would have to occur over the next three to five years for your business to be where you want it to be?
  • What are your profit and growth plans? How have they changed since you started this journey?
  • How much longer do you want to work in the business?
  • How quickly can you make effective decisions? Do you even have the information you need to make these decisions?
  • How do you stack up against your competition? (benchmarking anyone?)
  • Do you still have a clear vision/mission for your organization?

Take a step back every once in a while and reassess where you’re going and if your original destination is till where you want to be headed. If not, there’s always time to readjust.

Further, enjoy the journey. What you’re doing is pretty cool, and we want to see it succeed, grow and thrive.

Too wordy for your taste? Check out this infographic:

Business Planning