Starting a business used to be a form of art. Now, it looks more and more like science. The amount of information available on the internet for people interested in starting a business is massive, and can certainly be helpful if you are researching or validating an idea, a concept, or a method. Researching ideas on the internet can be complicated by fake websites, fake information, fake statistics, so finding trusted sources, trusted advice, and trusted consultants is exceptionally valuable. When the world is as fast as it is, everyone, especially business people, need to get answers that affect their decisions quickly.
If you are about to start a business, you already know that the success of your business depends on the following six most critical elements:
- Value proposition
- Unique attributes
- Niche in a sizable market
- Sound business model
- Cost-effective client acquisition
- Trustworthy accounting and legal professionals
Accounting professionals can serve in the role of a reliable trusted tax and accounting advisor because of her:
- knowledge of tax law
- knowledge of accounting practices
- understanding of your industry and your business
- understanding of your goals for acting proactively
- attitude of a friend and a partner
- communication methods that are efficient, clear, and consistent
- focus on what you need her to know not on what she thinks she already knows
- use of a fee structure that motivates focus on substance and not on billable minutes
- continuity if there is an unforeseen disruption such as sickness.
The jury is still out whether your advisor should be a CPA. Many small business owners make their choice based on lower cost, and therefore sacrifice knowledge and experience when choosing which consultants they engage. After over 25 years in public accounting practice, it has become clear to me that a trusted accounting and tax advisor is someone with an accounting degree (a Masters is preferred) and a CPA (certified public accountant) designation. There are certainly exceptions, but gambling that your exception is the viable one could be compared with playing a very high stakes lottery. Choosing an experienced CPA is a safer bet.
Don’t make a second mistake by choosing your advisor based on whether they are able to help you secure future financing for your startup. You, as the founder, are responsible for finding financing, and hiring a great advisor will help you get prepared, effectively and cost-efficiently, to make a great impression on the investors you decide to approach.
Once you choose your advisors, set your business plan and line up your financing, your startup is ready to roll.