Profit-First Poison Pill

Recently, I had a really interesting conversation with an advisor peer.

He teaches companies to make more money via the Profit-First Methodology.

(Profit-First Methodology = A financial strategy for running a business where you flip the Income Statement upside down, decide how much profit you want to make, then reverse engineer your business so that its revenues and costs get you to that profit number.)

He works most often with HoldCos

(HoldCos = Holding companies, aka. Companies who own other companies.)

But he says that the Profit-First Method can help almost every business.

Now, I'm a HUGE fan of using the Profit-First methodology.

(I even teach it to some of my clients)

It was coined by Mike Michalowicz in 2017, and it's a revolutionary way of running businesses.

If you run a small business in a traditional market and want to grow a little bit every year while always making money, it is a GREAT model to learn. Any CFO worth their salt should be able to teach it to you.

AND

For certain businesses, it would be FATAL.

• Profit-First doesn't work if you're building emerging tech

• Profit-First doesn't work if you're working with VCs

• Profit-First doesn't work if you don't have product-market fit yet

Here's the thing:

The industry is riddled with quick answers from experts on what works for every business

And while many of those insights are revolutionary for some teams

The same can be poison pills for others.

If you're working with an advisor who you trust

But the tools or services they're providing don't seem to be getting you to the next level

Maybe it's time to ditch their one-fits-all solution

And enlist someone with a broader perspective.

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