| 00:00 |
So what better way to conclude the birthday week going to the birthday weekend than with Episode 150? 150 episodes, man. Thank y’all. I was very grateful to be able to sit down with Kristian, FinStrat Management, today’s episode, and really even got very transparent with us about his first failed entrepreneurial journey. It really is being a solo entrepreneur and how that venture did not work out for him. But nonetheless, he didn’t let it break him. He didn’t let it get him down in the thumbs. He knew that ultimately he loved to create. |
| 00:30 |
Better yet, he even loved being in charge. So what did he really do with FinStrat Management? He talked to us about how he came into business and what his initial mantra and message was behind it, but how that was able to shift and now what he does with being over six years in business. So without further ado, enjoy yet again another milestone along the Down to Business Journey, Episode 150, Win or Learned. Welcome, welcome, welcome back to another episode of the Down to Business podcast here with Samar Turner. |
| 01:04 |
Look, time is ticking. We’re getting closer. I don’t know if you got your ticket. You secure your ticket to Orlando, but if you haven’t, and you still have time, you still have the means to, like I said, I know it’ll be on a Wednesday, but I get y’all to Atlanta. I mean, I would get y’all to Orlando. It will not disappoint. If you enjoyed yourself in Charlotte and everything that we offered and that we came with, Orlando will be that times 100, I promise you. But nonetheless, I’m here to take care of what’s in front of us right now. |
| 01:29 |
So right now, I’m sitting across from Kristian, very excited to be sitting down with him for him to not only share his expertise, but also share how he could maybe even help you, help your operations, help somebody you may know, really help make things simpler. Because I feel like on the podcast, you know no matter what industry, no matter where we are, no matter what we’re doing, big shout out to my boy Quasi, who just joined us. But I feel like no matter what industry, anything like that, we always just like to work smart, not hard. You know what I’m saying? I think we do work hard. I’ve talked to a lot of hard workers here. But arguably, if we had to all put it to the side and everything was just easy, seamless, everything of the sort, I’m sure we would. |
| 02:01 |
So I’m pretty sure that Kristian will be able to appeal to some minds today, teach some things to some folks, and maybe even get on the radar for those who may not know of what’s going on. So Kristian, how you doing today? How’s everything on your end? Tamar, doing great. Happy to be here, and thank you very much for having me. Oh, absolutely. We’re very happy to have you. So one, I know that there are going to be a lot of people tapping it. From your side, from my side, we’re going to have some people even in between who may not know either one of us. And that’s what I love the most. I love welcoming new people. So if you’re one of those, thank you. Welcome to the platform. |
| 02:32 |
But to get everybody on the same page, to really even the playing field here to really make sure that everybody kind of starts at a fair advantage. Can you one, just tell us a little bit about yourself, and then can you two, just tell us what brings you on the Down to Business podcast today? Absolutely. So I’m sure you can appreciate, I could talk for a while. So I’ll start at 100,000 feet, and then we can dive into any level of detail that you like. But today, I’ll call it in from Bozeman, Montana. |
| 03:00 |
I serve as the president and CEO, coincidentally, also the founder of Finstrat Management. On paper, we’re headquartered in Annapolis, Maryland. This is where I founded the company back in early 2017. But today, we’re distributed nationally. We have members of the company on both coasts and central and mountain time. |
| 03:25 |
We do outsourced accounting and finance services, as well as reporting for a whole host of stakeholders. So early-stage businesses with a heavy emphasis on tech. So think business-to-business software as a service. We work with high net worth individuals, otherwise characterized as angel investors, registered investment advisors, and then venture capital firms. Coming up, oh my gosh, I mean, it’s crazy. |
| 03:56 |
Over six years in business, you know genuinely love what I do. And so with that, I’ll give you a brief background, and I’m happy to unpack anything that I say. So first-generation American, dad was born and raised in Mexico, mom in Sweden. They met in Brooklyn, of all places. So I was born and raised in New York City, did high school in Jersey, ended up attending the Naval Academy, graduated, accepted commission as an officer in the United States Marine Corps. |
| 04:32 |
After I got out of the service, really wasn’t sure what I wanted to do, but knew that I liked numbers. And so I thought that was a good start. And so I started a career in investment analysis. Not sure how familiar you are with the space, but there’s a professional designation called the Chartered Financial Analyst Charter Holder. I’ll save you the details. It’s just a hard exam. At the time, three exams, three years. |
| 05:03 |
Past rates are, depending on the exam, under 50%. So set another way. A lot of sudden had to take place. But next year will mark my 20th anniversary. And over that period, I’ve had a whole host of roles in the beginning, more heavily focused on accounting and finance. But then as time went on, I actually and this is a fun story too, and there’s a whole bunch of great lessons to share today, but ended up getting pulled into a company where I was employee eight. |
| 05:38 |
Fast forward nine years later, the company IPO’d for $4.4 billion a year after I left. And so tremendous amount of success in a healthcare IT company. Then did a stint as a founder in a telemedicine company. A lot of great lessons there as well, what not to do when starting a company. And then it brings me to Fin Strat, where we are today. |
| 06:07 |
Gotcha. Well, first and foremost, I said it. Even my boys on here said it. Thank you for your service. We definitely do appreciate that. But wow, just to really hear the range of experience, the host of just different things, even sometimes you not necessarily knowing everything that you wanted to do. But even hearing what you were able to do with other companies, major, major, major congratulations and major accomplishment in that IPO. That’s amazing. To work for my first company that actually wasn’t public and to be a part of that process and the IPO and everything that goes into it, I know how we celebrated and really how happy everyone was across the world and everything like that. |
| 06:40 |
So I know for y’all that was just amazing at that number especially. So Maryland. So with East Coast, as somebody born in the Bronx myself raised in Philadelphia, I’m very familiar with your side of town where you’re coming from the East Coast most definitely. So okay, how did really things come to fruition like this? Talk to me about the build out, how we went from just in Maryland to now we have employees on both coasts. |
| 07:07 |
Like you said, there were just a mass and a range of just different experiences and life happening that you had offered to, like you said, get you really to finish that. So just from your interest and what you had, just from the passion, just from even, like you said, what not to do. How did we go from Annapolis to now where in Montana to now we have employees holding down both coasts, but ultimately still all for the betterment of FinStrat Management? Yeah, you know it’s a fun story and a lot of great lessons in there. |
| 07:36 |
So let me give a little bit of additional context because I always kind of find it’s healthy. You read stories about someone being wildly successful and you start to pick apart. What are the things that they’re doing that they know that I don’t? And so you know today I do set aside some time to mentor entrepreneurs. And you know there’s generally a reoccurring theme like, “Hey, you know it’s great that you’ve built this business. |
| 08:01 |
How’d you do it?” And I always kind of start with, “Well, let me just give you a little bit of background on myself,” because there’s an analogy I like to use. Have you ever heard of CrossFit before? Okay, so CrossFit started near the turn of the century. Greg Glassman out of Santa Cruz, California, you know, effectively creates a better mousetrap in how people become more fit. |
| 08:29 |
And, you know, it’s culminated today in the CrossFit games. And you watch some of these athletes and you say something to the effect of, “Oh my gosh, you know how do I become like one of these fire breathers?” And what you quickly appreciate in your attempt to pursue to make it to the games is that you realize that, I mean, there’s dedication, discipline. But you know to a certain degree, you know there are genuinely some people who are better athletes than others. |
| 09:00 |
Now, not to say that we can’t all achieve greatness broadly. But that said, I think it’s valuable to have background on myself. So, you know, grew up as an only child. And so, you know, very fortunate. Parents were very loving and caring. I got to do a tremendous amount of travel as a kid. I spent my spring breaks in Mexico, my summers in Sweden. |
| 09:28 |
Everyone always asked, “You trilingual?” I’m like, “No, I was like the prototypical American. Everyone must speak English.” Very hard-headed. You know, it’s funny. I share with my wife. You know I can never remember anyone like having a conversation with me until maybe I was in my 20s where someone explained to me how things work. And I don’t mean like mechanically, but I mean just like the concept of money. |
| 09:58 |
Like I generally just didn’t think about it. And by no means, you know my parents, for all intents and purposes, were you know middle class. I mean, they weren’t driving you know they’re driving Hondas and Oldsmobiles. But still, I mean, they’re just happy, happy kid. And so I do think that’s really important because along my professional career, there was a tremendous amount of discovery that had to take place. |
| 10:28 |
Most of it, you know just me figuring things out on my own, but other parts of it just being exposed to some really sharp people. And especially when I’ll give you some insight into the IPO, you start to realize that there are absolutely degrees of excellence. And it is important. It served me really well in my career. But that said, I got married super young. |
| 10:56 |
I just celebrated 25 years of marriage last month. And again, I think that’s pertinent because just by the person who I was, never was a partier. Well, let me take a step back. I got married really young. So I got married at 22. Our first kid showed up a year later. He’s since graduated. He has his own construction business in Nashville. But it’s pertinent to the conversation because you know it put me on the straight and arrow, just the type of person that I was. |
| 11:26 |
I was like, “I must take care of my responsibilities.” And so there’s an element of discipline that bled in there. There’s an element of just focus. And I do think it’s pertinent. But that said, our youngest, our daughter graduated from high school in 2021. This was culminating 20 years in Annapolis. So I met my wife my senior year at the Academy. After I got out, we did a brief stint in LA, which was fun. |
| 11:57 |
But then eventually realized we wanted to buy a house. So we came back to Annapolis where our network was and great place to raise a family. Chesapeake Bay is absolutely gorgeous. But today, you know I devote if it’s not exercise or the misses, you know I’m devoting almost all my time to the company. |
| 12:19 |
And I say that because one of the reoccurring themes that I find that comes up in a lot of conversations is, you know how do you make this transition from being an employee when I have car payments and mortgage payments, you know not withstanding groceries and just quality of life, it’s hard. Notwithstanding too, bringing a business to life when you have kids who want your attention. I mean, there’s a lot of challenges. |
| 12:48 |
And so anyhow, I think it’s an important backdrop that your listeners have because there’s definitely elements of my experience that are contributing to my success. And I can’t discount them because they play a big part. So happy to unpack anything I said or didn’t say. No, absolutely. No, I definitely do feel like you’re as I touched on even in my previous answer or even in my previous response that I feel like a lot of what you’ve went through, a lot of what you’ve learned, a lot of what you’ve been told, a lot of what you haven’t been told and what you’ve even been exposed to allowed you to kind of make your own decisions in a sense. |
| 13:25 |
But also a lot of this kind of had that curiosity out there for you. A lot of times, like you said, you can’t really recall that first conversation about people really giving you the logistics of things until your 20s. But that’s a whole lifestyle of just seeing things, of just being exposed to things of being here, one moment of being here, another moment of not being trilingual, like we said, of just being the standard and the regular. But there was so much that came with that. So no, I’m very interested to more so and I think my audience is even too. One, like why FinStrat? |
| 13:56 |
You had, like you said, from the IPO to everything that you were doing before, military experience, family, very young, getting on that straight and narrow, was that really the because oftentimes when we have life changes, when we have milestones or accolades or everything come up in the, it will change and it will shape the direction in which you move, how you operate moving forward, everything. Having a child at 22, you know as someone who’s 26, I can’t think of that. I can’t think about just getting out of college. I was actually in grad school at age 22. |
| 14:25 |
So that would have really turned my world upside down most definitely. But for others, you know it will also cause you to, like you said, hone in. Now it’s tunnel vision. Now it’s nothing outside this matters. This is my responsibility. What’s everything that’s going on? So what really, if it was even one thing per se, what really propelled you to hone in and lock down and birth ultimately fin strap management? You know It’s a good question. And so the precursor to that is the company I mentioned. So Anovalan was the name of the company that IPO’d. |
| 14:57 |
And there were a number of investors in that company who knew me, had a high opinion of me, and ultimately invested in what was a telemedicine company that I co-founded with two physicians. A tremendous learning experience ended up raising two and a half million pre-revenue. Half about from the US, the other half came from Europe. |
| 15:26 |
And two and a half years later burned through all the cash and generated very little revenue and ultimately closed the doors. Effectively, a failure at my first attempt of being a solo entrepreneur. A whole host of phenomenal lessons came out of that. But one of the big things that I found out about myself is that I very much enjoy creating. I also very much enjoy being in charge. |
| 15:55 |
And so you know I think this part’s really important. You hear people talk about know thyself, and there’s a tremendous amount of truth in that. And in so much as I think the more honest we can be with ourselves, the easier it is to achieve whatever goals we set out. Because at least if you start doing Agonist assessments, you can start identifying the things that may be an impediment and what you need to change if you really want to see something different. |
| 16:26 |
So I kind of got pulled into telemedicine because An Ovalon was healthcare IT. And if I were to go back even the beginning days of that, I got hired as a financial analyst. Originally, the company was doing consulting. And the president and CEO was a go-getter. He was actually a physician and saw an opportunity within healthcare IT and decided to pursue it. |
| 16:57 |
And right place, right time, phenomenal work ethic, very sharp. And you know as time went on, you know it’s like I waved goodbye to financial analysis, found myself having to talk to other nurses acting somewhat as a capacity of clinician, but really just self-taught. And so fast forward into the telemedicine industry, I was like, “You know what? |
| 17:23 |
God bless healthcare, but I really want to get back to numbers and investment analysis.” And so ironically, and here’s another good lesson. So I started Finnish Strap Management thinking I would help entrepreneurs raise capital. And I thought that was a good starting point because after my experience with the telemedicine company, kind of the process had been demystified. |
| 17:51 |
Like I remember going into it thinking, “I don’t even know what a term sheet is or how the process works.” And then after I went through it, it’s like anything else. You familiarize yourself, you have the experience, and you say, “Oh, you know it wasn’t really as complex or mysterious as I thought it was going to be.” And having spoken to other entrepreneurs, have their own businesses, I had heard similar things like, “Hey, what’s a convertible node or a safe note? |
| 18:21 |
Or how does this equity financing thing work?” So lo and behold, I ended up reaching out to a gentleman by the name of Grant Elliott. Grant today was our inaugural client. Still is the president and CEO of a company called Estendio, headquartered in Virginia. |
| 18:42 |
And I had met Grant when I was running the telemedicine company, and I had lunch with him one day, and I suggested, “Hey, you know if you need help raising capital, you know I’d love to work together.” And he said to me, “Ben down that road wasn’t the best experience, but what I really need right now is a new accountant because my current one is about to move on.” And he also said, “I need a dashboard. |
| 19:14 |
I need to be able to understand how my company’s performing.” And so you know I kind of go to these you look around and you hear people say, “Well, okay, there’s this thing is called a pivot.” And there’s also this thing is you know despite whatever we think, really, you know is the market want what you have? And so I looked at Grant and I said, “I can do that.” And so Finch Trat was born. |
| 19:38 |
And today, we have over two dozen clients, the majority of which are B2B SaaS companies, though we have high-net-worth individuals, venture capital funds that we work with. And what I found out in the process was in this category of investor-backed companies, generally speaking, they have their eyes set on growth. |
| 20:06 |
And so ultimately, monetizing their business, whether it’s a sale or an IPO. And depending on what stage you are in the business, it’s going to dictate to the extent that you have to be able to communicate performance to investors. And so you know on the surface, there’s no shortage if you Google web-based dashboards, there’s no shortage of companies that make tools available. But at least in the financial performance world, there’s this underlying foundation of just clean financials. |
| 20:40 |
Now, on the surface, you know for someone who’s not in the weeds day-to-day, you know you’d say, “Oh, that makes sense.” But the irony of it is, and in my experience, no fail, 10 out of 10 sets of financials we inherit when we onboard a client are in desperate need of TLC. It’s just the degree. I have theories as to why that’s the case, but what’s become a hallmark of our company is what’s known as Gap, Generally Accepted Accounting Principles. |
| 21:15 |
Getting those financials in a position where you can then start to publish dashboards. Now, I’ll leave it here. You know That’s kind of tip of the iceberg. Our implementations are led by chief financial officers. They’re fractional, our employees. But kind of like our discourse that we’re having here, I find that a lot of time entrepreneurs, they know their product really well. They know their space really well. Some of them are really adept at sales and marketing. |
| 21:43 |
But you know I don’t think it’s fair to ever have an expectation that, kind of like when I started, that they understand how debt financing or equity financing works, or what should be the cadence or interactions be like with an investor. And so our organization really goes a long way to make sure that our client CEOs and C-suite get that degree of comfort because it is in our wheelhouse. I like that. I like that. And especially as a numbers guy myself, I love numbers. |
| 22:13 |
Math is definitely my favorite subject to date. So I don’t know when I plan on going back to school, but who knows? But to really hear that, to even hear, in a sense, having to go back to the drawing board or necessarily what you were, it’s not always easy to step away from something that you’re in, something that you’re comfortable in, something that you’ve even helped to succeed, helped to grow, help to IPO, help to do all of that. But also, too, it’s not always in our nature or always just something that we want to experience. Nobody wants to experience failure. Nobody wants to experience the trials and the tribulations. |
| 22:43 |
Nobody wants to have the bad days. So you know you talked about a situation, a scenario where you were unsuccessful at a business attempt. And for some of us, for some people, you know being unsuccessful at one could really turn you away from that world in general. Could really, even like when you reached out to Grant, like you said, has been there, done that, not really what I’m trying to go back to. Sometimes one bad apple can truly spoil that bunch. And sometimes it could be the bad apple could be a little bit of every, it could be little to no experience. It could be just didn’t really take things seriously. It could be not having the funds. |
| 23:12 |
It could be a host of different reasons as to why that was just not successful in that moment. It could not be the make or break, but for some, it really can be the sole determinant factor as to why I never want to step foot back into that side of things. So the fact that you had that though, you had that experience. You had something that wasn’t so pleasant for you. You left a nasty taste in your mouth. But nonetheless, you said you’d like to be in control. You like to really have things going. So you took that, you took those lessons, you took those blessings and everything that came with it, and you revamped things a little bit. And thus you were able to come out with this. |
| 23:41 |
And so something that you touched on a couple of times now that I really also want you to share for my audience and your audience and everything out there are just lessons or just failures. They’re not so good days. So can you also talk about some of the life-changing things that have helped you within being a business owner, within being an entrepreneur, within working with so many other different companies, within talking to CEOs, CFOs, COOs, everything of the sort. |
| 24:05 |
What are just some focal points or even some lessons that really stand out to you in regards to just business ownership and the entrepreneurial world and everything that really comes with it, even the things that we don’t think about, even stuff that goes on behind the scenes after we wrap up this interview. Can you just share that with my audience and for everybody else that’s tapping in? Absolutely. Happy to. And probably the best starting point is what we were just talking about a moment ago. So I don’t know if Nelson Mandela actually said this, but and I’ve seen quotes online that says something to the effect of, you know, win or learn. |
| 24:39 |
I never lose. And I think it’s a phenomenal mindset because there’s a tremendous amount of truth in it. Really, you know you’re saying, “Hey, you know just keep going. Don’t quit.” Sometimes I find that that’s just borne out of necessity. You know If there are absolutely people who are at a point in their lives and they’re like, “No matter what happens, I must go.” But then sometimes you’re fortunate enough to have a mentor in your life who you know at my age now, I understand the concept that someone says, “Hey, look, it’s okay. |
| 25:12 |
Nobody knows everything.” To a degree, everybody is making it up as they go along. But, you know, unless someone pulls you aside and kind of tells you that, you know, it’s, it’s kind of, you kind of feel like, “Well, man, how, how am I going to do this?” Because I don’t know how it works. So part of it, long way of saying, part of it, I do think is just a mentality to say, “Hey, look, everything’s going to be okay.” you know It’s just a question of pressing forward. |
| 25:42 |
Now, pressing forward is very broad. And one of the things I’ve kind of in my life, I try to avoid parables as much as possible because I just want the answer. You know Kind of talk about math. It’s like, I hated English because it was so subjective. I know one plus one equals two. So this is good. I like this subject. And so you know one of the things I’ve always thought about, it’s like, “Okay, well, very practically tell me you know how this works.” And if there’s chief lesson among anything is there’s no substitute for action. |
| 26:18 |
Like First and foremost, anyone who has an idea, you know I think a lot of times people think, “Well, I need to get my business plan written and my deck written. You know I need to get you know a long time ago, people joke. I need to go to Staples, and I got to get my business cards and my pets.” It’s like, “Stop. You don’t need to do any of those things.” you know First and foremost, in the world of business, there’s one question that anyone should ask before they start their company, and that is, will someone give you money for what you have? |
| 26:49 |
Because if they won’t, you don’t have a business. And I learned that the hard way with the telemedicine company. So you know here I am. I’d argue you know a couple of brain cells to rub together had two really sharp co-founders. And if anyone is interested, they can go to my LinkedIn profile. And in the project section, I posted the pitch deck business plan that I used to raise the capital. |
| 27:19 |
And if you read it, I mean, it’s very logical, very rational conclusion as to why this business was going to work. But at the end of the day, it didn’t matter. We couldn’t get any physicians to give us cash or anyone for that matter for what we had. And so today, this is such a reoccurring subject when I talk to business owners and entrepreneurs. |
| 27:44 |
It’s this idea that they have to do all this other extraneous stuff besides closed deals. And I see it manifest in so many ways. You know Whether someone believes that they have to build inventory, they have to hire a VP of sales, they have to sign an office lease to show the world that they’re a business. |
| 28:15 |
And in my experience, the absolute number one priority of any entrepreneur or business owner is answering the question, will you give me money for what I have, whether it’s a product or service? So you know as a starting point, I think it all begins there. Now, having a flexible mindset, I’d say is the next part. |
| 28:40 |
And because kind of again, like when I use the experience, if I thought I’d help entrepreneurs raise money, I mean, i mean that was fine. I said, okay, let me run with this and see what happens. And I found out, fortunately, very quickly that I was off base and that I mean, maybe I would have found somebody, but I found a lot of people who are willing to pay for accounting and finance services on a fractional basis. And so this idea of being flexible is really important. Saying, don’t let your ego get in the way where you insist on being right. But what I have is awesome. |
| 29:11 |
Yeah, but it’s inconsequential unless there’s market demand for it. So two would be you have to listen to who your potential buyers are. You have to understand their problems. You have to be an active listener. Like genuinely like saying, “Okay, you know here’s what I think is going on. Am I right? I’m not. Okay. I’m all ears. Tell me. And then starting to understand how do you solve those problems at a profitable price point? |
| 29:44 |
And here’s another really valuable lesson. You know Not all businesses are the same. I think one of the things that happens often is you read the news and you hear about how Facebook or Uber you know goes vertical. That’s the exception. I don’t know that a lot of entrepreneurs appreciate that most businesses if there’s a pattern, it’s like a stair step. If you’re on the right track, you see growth and then it plateaus. |
| 30:13 |
And then it increases again and it plateaus. And there’s like these consolidation phases where the infrastructure of the business catches up to the track that you’re on. But no two ways about it. You know So just big items, and I’ll take a moment to pause, but it’s taking action, figuring out what the market’s problems are and whether they’re part with the money in their wallet for you to solve it. |
| 30:43 |
And then just being flexible enough to, I don’t want to say roll with the punches, but, you know, shift as the market changes. Or people tell you, hey, this is what I want despite what you think, Kristian. So definitely, definitely some big, big lessons that I find reoccur often. Absolutely. And I really love how much you placed emphasis on the flexibility part because I feel like no matter what you do, business owner, entrepreneur, nine to five or CFO, CEO, CEO, anything that you really do, you have to be flexible. |
| 31:14 |
We are in ever-changing times. And while a lot of this is unpredictable, we may not have had expected it, we may not even agree with it like it, want to adapt to it, we really have no choice or ultimately we’re going to get left behind. So I definitely have learned in just talking to people across so many different sectors, even just myself, that you have to change, that the things you were doing a couple of years ago, five years ago, six years ago, it’s not going to work right now. Yes, we talk about or we thought about that. Some of this stuff would never happen, or we would never be moving in this direction, or some of this stuff is really just eye-opening to advance for us, whatever the case may be. |
| 31:47 |
But you have to adjust and adapt in some way. And it’s not saying just become a master of everything every time that it comes out. But no, it’s just being able to keep up with the times and not really being so left behind or so in the dark that you don’t even know that, oh, we stopped doing that a while ago, or no, we operate on a totally different spectrum because that could also lose you business in a sense. If you can’t even really keep up with what your clients have going on or meet their needs or even know their needs, well, then it’s nothing really to talk about. |
| 32:12 |
Because a lot of times, and I feel like a business may psych themselves out or may take themselves out of that just because they’re behind, or their software may not be up to date, or they’re working too hard and not smart enough. So I love to really hear that because it also goes to show that everything that you did, everything that you put your name on, everything that you put your best foot forward for, you did just that. You put your all into it. You did what you had to do. And whether it went your way or not, you learned from it. You grew from it. You kept it moving. You kept it going. |
| 32:41 |
And ultimately, you found yourself back where you needed to be, starting something, doing something to be able to help others. And maybe you came in on this side of things, wanting to do it this way. But maybe after talking to some people having some conversations, seeing the wants and the needs of others, you had to shift and you had to tailor a little bit. Had you not been able to do that, who knows if FinStrat would be a thing, let alone it really be where it is today. So for my people out there, because I know we’re going to have some people tapping in who want to utilize these services, who want to know more, who want to learn and everything like that, but maybe some of the terminology that you use, maybe some of the things that you said went over their head, or maybe they don’t know the telemedicines or the B2Bs or the SaaS or anything like that. |
| 33:18 |
So when it comes to the companies, the industries, CEOs, CFOs, everybody who you’re working with, growing with, helping, assisting in some form or fashion, what would you say are some of the common denominators? What are people really coming to you for help for? What are people using FinStrat for? What have you guys really adjustments have you really been able to make for businesses? What problems have you solved for people? Ultimately, what are people coming and saying, hey, Kristian, team, I need you guys. We’re doing this, or we’re not doing this, or we’re missing blank, or we’re trying to get here, but this is stopping us. |
| 33:48 |
What are some of those things that you guys are really hearing time and time again? Yeah, and that’s a really good question, because I’ll find entrepreneurs will ask something like, at which point do I need a CFO or at what point does it make sense to really start to build out an accounting and finance function within a business? And our clients run the gamut, but I would tell you, if there was a sweet spot, let’s call it a million dollars in reoccurring revenue. And we have clients who are smaller than that. We have clients who are larger than that. |
| 34:18 |
But I’ll use a million as this milestone because again, there’s some really important factors at play here. And one is, all right, so you get someone to agree to give you your money. Question is, can you now do this at scale? Can you get more and more and more people to do it? And you know I get asked, at what point should I hire you? |
| 34:40 |
And you know really my first response is, you know until which point you have confirmation that you have a potential winner and I don’t say I say potential intentionally, but a potential winner on your hands because you can consistently make sales. That should be your sole focus. And so you know I joke, but you know people say, oh, I’m the chief executive office officer. And I’d say to founders, I said, no, you’re the chief hustle officer. Like that’s your job. |
| 35:06 |
In the beginning, like all of your focus, almost all of your focus should be on your product and then closing deals. And in lieu of and I’ve seen this happen, it’s like, “Oh, I need a really good lawyer, and I need to paper the company a certain way.” Or you know it’s really important to me that my financial models are solid. And there’s value in having those things, but they have their time and place. And so let’s just say first million dollars. |
| 35:38 |
I’d say conserve your capital, especially in this environment today, too. You should focus on becoming profitable. And that hasn’t always been the case. Prior to the Fed raising rates, starting to raise rates last year, there was a general acceptance that if you were a tech company, it’s okay if you were in the red. You’re just going to go raise more money. World has absolutely changed. |
| 36:02 |
And you know one of the things that really was an eye-opener for me in the last 12 months, especially when Silicon Valley blew up, is with rates where they are today, the world is looking at these early-stage tech companies a lot different. You know They’re not generally not profitable. Some are, of course, but they don’t pay dividends like a more mature company. |
| 36:29 |
And so you really start to look at them as like, “Well, how do I get my money out?” And it’s not to say companies are going to take seven years, but they generally are tying up money for a while. And so the world is now looking at profitability metrics much more closely. And so until interest rates go back down to 0% or 1%, which I could see happening one more time if there was a material economic slowdown. |
| 36:59 |
My very strong counsel to any entrepreneur is, first and foremost, just get the first million in revenue, but also put an emphasis. Be very careful of how you spend your money. And unless it’s mission critical, you don’t need me. You don’t need lawyers. You know, depending on what you’re selling, you just need the service delivery or a dev team to write your code. And I don’t also this is another, I think, very important subject. |
| 37:31 |
I think there’s this general belief that as companies get going, they have to hire a VP of sales. I counsel against it. In the beginning, I would say that the founder of the company should be leading all sales efforts. And if anyone who’s listening to this is like, “Oh my God. Well, what am I supposed to sleep you know if I have to build my product?” I mean, that’s why starting a business is hard you know and requires a tremendous amount of commitment. |
| 38:00 |
But I’d also tell you there’s a lot of value in that because you know for someone who has to make a tremendous amount of sacrifices, you know it makes you a better manager. Because when you meet BS artists, you know you quickly realize, like I don’t have time for you. I’m not doing what I’m doing because I’m going to be sidetracked by someone who has no clue what I’ve been doing. |
| 38:27 |
And so once companies hit that million-dollar mark, especially in the tech space, what I start to find happens is they realize they either want to start raising capital, let’s call it equity. And they know that whoever the investors are, whether it’s an angel or a venture capital, there’s going to be an expectation that they’re going to be able to communicate their financial performance. |
| 38:55 |
And so that’s when we start getting interest in our services. And I would tell you that becomes an appropriate time. The other time would be is that they’ve actually already closed the round. And what we find a lot of times is that venture capital firms will make introductions to us because information is very important to VCs. They have their own reporting responsibilities to their investors. |
| 39:24 |
But it can be more I would say it’s the norm that it’s challenging to get consistent good information out of a portfolio company or one of our clients or not one of our clients, but companies in general. Because you know again, is there so many things to do? And how do you prioritize this? And so that’s when they find that we get hired because people say, “This is an important box. |
| 39:49 |
I need it fixed once.” Because you’d expect, I mean, there’s a lot of accounting and finance providers out there. I mean, you Google it. I mean, the page, you know I’m sure you get thousands of results. What we’re a bit unique is we’re focused on investor-backed companies because we understand that stakeholders on both sides of the aisle need good counsel, but they also need a strong financial base if they’re going to eventually monetize their business. |
| 40:20 |
And so in that regard, we are unique. A quick little bit of color on the company or at least the philosophy. Low staff-to-client ratios, dedicated teams, full service, meaning we will do the non-sexy debits and credits all the way to the gorgeous dashboards. We insist on taking the lead on all things accounting and finance. So the financial component of a round or an audit. |
| 40:51 |
But we think it’s good business. We think that we can provide the best value the more intimately we know the company. And so it served us really well. You know Obviously, I can’t speak for our clients, but the feedback I generally get is big thumbs up. They’re like, oh my gosh, what a night and day difference than what I was doing before. And sometimes that’s really what it is. People may not know where to start or people may not know how to go back to the drum board or people may not take rejection well. |
| 41:21 |
Nobody likes getting knocked step backs, especially when you were making progress or nobody likes being told what they’re doing is wrong, outdated, or could be adjusted or could be changed. But there are people who, when you’re open to it or when you take the suggestions or when you recognize that you may not be the expert or for this particular part of things, you just can’t be in control. Oh, it can be that night and day difference, or it can be a big thumbs up. You can really simplify and make things much easier for people, and they may not even directly realize it. And sometimes they may not even see the results directly and instantly. |
| 41:51 |
Sometimes it’s a time thing. Sometimes it’s a process because like you said, this is not a thing of we’re just coming in here to fine tune or just a nook and cranny here and there. People are coming to you when it’s almost like it’s this or I’m done with it. And I don’t want to be done with it, but I also don’t know what to do. So I feel like you can be a saving grace for a lot of people. But that’s not always immediate. It takes time. The same way it takes time to build a business, to take over both East Coast, to relocate, get married young, have a family, do all of this. |
| 42:20 |
At the same time, that took a lot of just different time, effort, lessons, blessings, expertise, failures, successes, the same way it’s going to be in business. And especially when you’re client facing, when you’re B2B, when you’re SAS, like when all of that takes into account, when your bread and butter is literally sales, you have to make money. Are people going to buy what you’re saying? Are you of value to people? Otherwise, like you said, you really don’t have a business. And a lot of people don’t really understand that. Or they’ll just try to make shift into something else or alter here or just here. |
| 42:51 |
And that’s not always going to work. So sometimes you really need to take a step back, let that expert come in and watch them work. Watch them work smart and hard at the same time. So that way you can only work smart moving forward. And the rest of the work is really done for you. So, okay. You know, there’s one other principle at play there that you reminded me of. And I think it is really important. It kind of plays into our business model, but I think there’s applications that we encounter day-to-day. And so apologies in advance. |
| 43:20 |
I forget the economist’s name. It’s Ricardo something or other, but he came up with this concept called comparative advantage. And in simplest terms, the idea is focus on the thing that generates the biggest return on investment for you and outsource the rest. And so I have a lot of bad analogies tomorrow. And my go-to one is imagine you were a surgeon and you could type faster than your secretary. |
| 43:53 |
It wouldn’t make sense for you to do memos because you’d make a lot more money with a scalp in your hand in the OR. Well, it’s the same exact comp set today that has yielded trillion-dollar companies. So let’s use Apple as an example. A lot of people don’t appreciate that Apple exports the manufacturer of its devices. You know As compared to maybe 100 years ago when all of that equipment was sitting on your balance sheet as an asset, on the contrary, today, it’s all outsourced. |
| 44:27 |
But why is the company worth almost $2 trillion or over $2 trillion now? It’s because they own the intellectual property. And what Apple and Steve Jobs realized a long time ago is that their advantage was intellectual property. They had the marriage of technology and software and how to apply it better than anybody ever could. There are other less sexy examples. |
| 44:56 |
IKEA, great example. Their ability to design affordable furniture is second to none, but they don’t make the furniture. They outsource it. And so I think as an entrepreneur, especially if you’re starting out, it is a very valuable concept that should be incorporated because we should be asking ourselves, “What are the things that I do the best? You know What is my business?” And then say, “Okay,” and I’ll use a really easy example, “I may need legal documents, but I’m not going to become a lawyer, so let me hire a lawyer.” And then just extrapolate that to whatever you want. |
| 45:34 |
You know I’m not an accountant, but I know I need accounting and finance. Let me hire a team to take care of this. You know It really just becomes, what’s the extent? You know And I would say the big one, especially in software, is do you outsource to another team? Because there are a lot of companies out there that do app development, software development. And you just simply focus on design. |
| 45:59 |
And really, it’s a long way of saying that I very much encourage anyone who is either thinking about starting a business or running a business, answer for themselves, you know what is that thing that I do best and then outsource the rest? All right now, I like it. I like it. I like it. Big shout out to my guy, Shai, who joined us on the live. But no, that’s important. |
| 46:27 |
I feel like sometimes we’re so just quick to rush or dive into things, or we get an idea, and we just want to go like that. And you have to plan. Sometimes a blueprint has to be laid. The foundation has to be laid in order for you to really get where you want to be. Yes, there’s no problem with really thinking or coming into business with the end in mind. But you also have to focus on what’s directly in front of you too, what really you need, who you’re trying to appeal to. How are you trying to appeal to them? Are you consistently doing this? What are the pieces to the puzzle that you need? Do you need a team? |
| 46:57 |
Is this team of value to you and your business and what you communicate? So no, I definitely think you’ve done a great job today of breaking all of that down, of really honing in on specifics and really honing on different aspects and sectors of business that are all important for the overall umbrella. So before we wrap things up, before we close things out, before I give people, arguably to me, I tell everybody that, yes, whatever you said prior to that is very important, but arguably the most important part of the interview is really the call to action when you give your info and tell people where they can tap in with you and find you and everything. |
| 47:27 |
But before we even get to that, do you feel like there’s anything we haven’t touched on today that you want to leave for the people? Even some last words for business owners, entrepreneurs, creatives, nine to fivers, people who may just be coming across this episode who are very interested, who want to know more about FinStrat, who want to move forward in their business, who want to excel, who want to work smart, hard, or maybe even both together? Anything that you want to leave for the people out there who are listening? Yes, absolutely. So we’re at a really interesting point in history with the advent of artificial intelligence. |
| 47:59 |
And it’s actually very unique. If you remember the dot com boom, so think about when the internet started to gain mainstream traction. If today I said to you tomorrow, would you like to go back to 1996 and invest in Google, Amazon, take your pick? We probably all agree. Let’s get in the time machine. All right. Well, today, literally speaking, is that day as it compares to artificial intelligence. |
| 48:35 |
So for anyone who’s listening to this, my very strong counsel is start setting aside time to understand the no shortage of new artificial intelligence-based tools that are hitting the market today because our world is about to change. |
| 48:56 |
If you and I were to fast forward 10 years from now, I think we would look back and we say, “Oh, man, I wish I would have devoted a tremendous amount of more time and energy to the subject.” Because I tell you what I see is in terms of the ability for AI to increase somebody’s productivity, it’s unprecedented. I mean, right now, I’ve started incorporated into my portions of my workflow, and I’m talking a five-fold increase in time savings. |
| 49:28 |
I mean, this is similar to the Industrial Revolution as far as I’m concerned. And I would leave this. If anyone feels a little bit intimidated and they’re like, “Well, I don’t know how to code,” that’s okay. Totally fine. It’s like I use another analogy. I remember when I was a kid, there was a store in the mall called Spencer’s, and they used to sell all these posters in the back. And I remember I’d walk in there and there was this one poster that showed what looked like the cockpit of a 747, and there was just like wall-to-wall buttons. |
| 49:56 |
And I remember thinking to myself, “Oh my God, talk about feeling overwhelmed.” But pilots still fly 747s, appreciating the fact that it’s a process. So very strong encouragement for me to just start setting a set aside some time to just start learning the basics. Start in ChatGPT, you know just write prompts, see what kind of results it gets. But then again, if you start looking for sites, there’s a great one that I found I’d encourage you to go look up. |
| 50:27 |
It’s called There’s an AI for that. Forgive me. I don’t know the gentleman’s name, but he’s publishing no shortage of tools that are being made available to the public. And oh my gosh, I don’t think we’ve seen anything yet. So with that, Tamara, thank you again for having me. If anyone wants to come to the website, it’s FinStrat, MGMT. So Finn, short for Financial Strat, short for strategy, and then MGMT short for management. |
| 51:00 |
Welcome to look me up on LinkedIn. You know If they want to send me a connection request, they can get a hold of me that way. You know There’s a contact us on the website. And I love the subject of accounting and finance, business, creating wealth. And so anyone who’s interested, I’m happy to have a conversation offline with your listeners. And I appreciate that. |
| 51:25 |
I’m always very grateful and appreciative of people who just offer themselves up, even with everything that you have going on with the businesses that you’re working with, with people, and things that you will continue to amass and successfully do and take on. I love the fact that you made yourself open and available to my audience. But also in that same breath, I encourage my audience to take advantage of all of this. Even if this is not necessarily something that you can use in your business, it doesn’t hurt to ask questions. It doesn’t even help to get a second opinion. Get a second set of eyes on things. |
| 51:53 |
Get a professional to really speak on things and to really help you to really point you in the right directions. He just gave out some gems today in regards to AI. He just gave me even a website. And even for those in that space, you may not have known that website. People may have not even touched ChatGPT yet. People may be intimidated by this. And it’s nothing wrong with feeling intimidated, but it’s also nothing wrong with trying to gain an understanding and trying to just learn a little bit and just get a little bit. So that way, like he said, when we think about five years from now, eight years from now, 10, 15 years from now, we don’t just feel so behind the eight ball. |
| 52:23 |
We’re not just feeling like we’re still in typewriter days or anything like that. Because I would much, most, most, most definitely go back to 1996. One, because that was the year I was born. So I feel like There you go. But two, just because, you know, if I could, like you said, yes, if we could look back then knowing what we know now, I think everybody would hop in that time machine. And for those who didn’t, I would hope you didn’t hop in it because you’re running back to 1996, and you’re just trying to get back there just the same. So no, Kristian, very, very, very appreciative for you. |
| 52:52 |
Very appreciative for Finn Stratton, everything you guys are doing day in, day out behind the scenes to make things happen, everything of the sort I’m grateful for. But I’m also, like I said, I’m always calling out my audience. He made himself available today. So whether it’s on the website, whether it’s connecting with him on LinkedIn, whether it’s even following up after this interview to really see what they’re doing. Plug somebody else in. Like I said, if it can’t necessarily help you and what you have going on, think about all the other B2Bs in your life or that you know of or anything. Ask a question for someone else. Repost some information. Throw something out there for somebody. |
| 53:21 |
We could all be a resource to one another because he’s amassed a host of different experiences. So even something that he may not focus on with FinStrat, he may be able to help you because of his experience in telemedicine, or because of his experience within the military, or because of having a family at such a young age and really having to get on the straight and narrow, whether he liked it or not. So, again, Kristian, very grateful, very thankful. But at the same time, to all my audience, to everybody tapping in on the live, to everybody who continuously makes things happen. I hope to one, see y’all in Orlando. Whether I see you, whether I don’t see you, I still love y’all, I appreciate y’all, I thank y’all. |
| 53:52 |
This has been another episode of the Down to Business podcast. Here with Tamar Turner. |
