illustration by Alicia Traveria
Crafting a Business with Jenny Hart
Knowing how and when to hire a good adviser
By Jenny Hart
Published: May 5th, 2008 | 2:50pm
We all know the image of the boss or head honcho in the movies quietly considering counsel whispered in his/her ear from a most trusted adviser. They take in all the information before making a final decision. This is what wisely steering a business is really about: gathering the most reliable information to base your decisions on, not just bulldozing forward with every idea of your own, independent of wiser voices that might better inform your moves and decisions.
When you decide to fire up your own business, you’ll quickly find yourself asking for help, and you’ll need it. Some advisers are professionals who are paid for their services, but some of your most valuable advisers could be friends or family who help guide you for free. So who will be your advisers and how do you find them?
This month, I’m seeking counsel from Lauren Bacon and Emira Mears to advise us on advisers. Together they have authored the book Boss of You (Seal Press) and have some sound ideas on how a small business builds its dream team.
Who are “advisers” and how do they serve a business?
Business advisers are kind of like personal trainers: They're not there to do the work for you, but they will give you expert, specialized insight into how you can be more effective and achieve your goals — whether that goal is to build up capital to reinvest in the business or protect your legal rights. Advisers don't necessarily need to be professionals; some of our best advisers have been colleagues with more experience in a particular area of business, but in many cases, you will turn to your advisers for professional knowledge in a specific area.
As a small business owner, you are always juggling a lot of balls, but when it's time to delve deeper into one area — whether it's finance, marketing, legal stuff, long-range planning, or something else — the advice and guidance of someone who's a pro in their field can go a long way to helping you make smarter decisions.
What professional advisers should a small-business person hook up with at the beginning?
Every business will eventually need a lawyer and an accountant, but small businesses can often do without either for a while. A lot will depend on the kind of business you're running. If you need to incorporate right off the bat or have copyright, trademark, and/or patent concerns, then you'll want a lawyer right away. Even small service firms are wise to have a lawyer available for assistance with wording contracts, partnership agreements, and so on, though you can get a long way on the advice of books, small-business resource centers (many states have government-funded programs to help entrepreneurs with basic contract templates and such), and the occasional e-mail or phone call to a lawyer just to make sure your T’s are crossed and your I’s dotted. As for accounting help, if you're like us and start out as a partnership (the equivalent of an LLP in the U.S.), you can probably get away with just having a bookkeeper (which is a lot cheaper than an accountant), but if and when you incorporate, you'll need an accountant for sure.
Ultimately, every entrepreneur needs to ask herself what her personal strengths and weaknesses are, as honestly as she possibly can, and then look around for people to fill the gaps. In our book we’ve included an exercise devoted to this very topic to help business owners get clear on where they do need the help of an outsider. It's tempting to think you can do it all — especially when you're trying to save some cash — but the wisdom and experience of someone who has been there or who is a pro will almost always pay you back in spades and save you the trouble of learning from well-intentioned mistakes.
If your budget is small but you need to pay a professional adviser, who should you invest in? In other words, where is money well spent in terms of paying a professional adviser?
We're big fans of keeping your budget modest and working within your means. If you're strapped for cash but need to hire an adviser, it's worth asking if they'd be willing to work in trade or to let them know flat out that you're working with a limited budget and ask what they think would be the wisest allocation of your limited funds. That said, when it comes to hiring someone you're going to entrust with critical business information, it's probably best to remember the old "you get what you pay for" adage; this is not necessarily the place to skimp, budget-wise, if you can help it.
In terms of when to hire a pro and when not to, we heard some recurring themes when we were writing our book. No one seemed to regret hiring a good lawyer (the bad ones are a different story), but a lot of the people we talked to said if they could go back and do it again, they'd wait longer before hiring a P.R. agent. The common thread was that small-business owners in particular tend to understand their market niche better than an outside P.R. adviser, and they found that the typical processes of a P.R. agent just didn't fit well with their smaller-business ethic. Many of them recommended seeking advice on the basics — like how to write a good press release or put together a good press kit — even if it means paying someone for help with a few of the smaller pieces. But save your budget on hiring a pro for a full P.R. campaign until you've really hit the big leagues.
What is the best way to find advisers?
The best way to find professional help of any kind, from plumbers to lawyers, is word of mouth. Ask all the entrepreneurs you know who they recommend — and be sure to ask them if there's anyone they don't recommend, too, because you'll save yourself a lot of time if you know who to avoid. If you don't have a local community to draw from, see if you can find help online. Discussion boards like The Switchboards and Craftster are great places to start. Of course, you can always try going through professional associations; most of them have searchable directories online, but you may have better luck just phoning the association office; give them details about what you're looking for, and see if they can provide you with a short list of likely candidates in your area. But if there's any way you can swing it, a personal recommendation is definitely the way to go.
When you've got a list of people to call, draft up a short list of questions to ask. Tell them a little about your company; then ask about the clients they work with. One thing we generally recommend when looking for professional advisers is to ask them what their area(s) of specialty are, because the answer can tell you a lot about whether you're likely to be a fit. There are bookkeepers who specialize in working with freelancers and others who work almost exclusively with larger firms; lawyers in particular are usually specialists.
How can you tell a bad adviser from a good one? It’s an adviser’s job to know more about something than you do, so how do you know if they’re giving good advice?
The most important thing you can do to avoid hiring the wrong adviser is to always, always, always ask for — and check — references. (This goes for anyone you're thinking of hiring, by the way.) You'd be amazed how much you can learn from a couple of five or 10-minute phone calls. Be sure to ask lots of open-ended questions rather than ones that can be answered with a yes or a no; you want to get these people talking, because a lot of the really insightful stuff comes from tangents and "by the way" comments. Remember that a lot of people are inclined to try to sound positive when someone asks for a reference, so put your critical-thinking cap on and listen hard to distinguish genuine enthusiasm from stock answers. You don't just want someone who's OK at their job -- this is someone you're going to trust with a lot of important, confidential information about your business, and you're looking for the very best ally you can find.
What are the warning signs of a bad consultant or adviser?
The biggest giveaway that you're dealing with a bad adviser is if they try to dole out a one-size-fits-all solution. It's likely your first sign of this will be that they don't ask you many questions about you, your business, and your goals; instead, they rush straight to handing out advice. If you get the impression they're more interested in sending you down a conveyor belt than building a relationship with you, run away. Another pet peeve of ours is when an "expert" can't be bothered to explain themselves in plain language. Our experience has been that if they shy away from helping you to understand the language they're using, they're likely trying to keep you from figuring out that they're full of it.
I agree! I feel it’s an adviser’s job to explain and clarify things to their client in a way they understand. Can you talk about your own advisers? Who is your most important and cherished adviser?
We love, love, love our bookkeeper. She's fabulous — always calm, cool, and collected, which is a good thing in a person who deals with your money. And she's been with us from very early in our business's existence. We do our own day-to-day bookkeeping, but she helps us keep our payroll straight, advises us on what kinds of expenses we can write off, and gives us a lot of free business advice along the way. (She runs a successful small business herself, so she knows what she's talking about.)
The other adviser we hold very dear is our business coach. We meet with her every couple of months and discuss long-range goals and business challenges, so one session might be devoted to figuring out how to expand our service offerings, while the next might be about how the heck we're going to take time away from work to promote our new book. She's the most upbeat, enthusiastic taskmaster you ever met, and she's amazing at helping us dream bigger, and then do the work necessary to achieve the dreams.
Isn’t that what it’s all about? Thanks Lauren and Emira for your wise counsel! Visit laurenandemira.com for more information.
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ABOUT THE BOOK
The Boss of You: Everything a Woman Needs to Know to Start, Run, and Maintain Her Own Business (Seal Press)
By Lauren Bacon and Emira Mears
256 pages
List Price: 15.95
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Zines with a DIY business focus:
Croq Zine
croqzine.com
Mixed Tape
mixtapezine.com
DIY biz chat:
supernaturale.com/glitter
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This is the seventh installment of Jenny Hart’s “Crafting a Business” column. Send your questions to askjenny [at] sublimestitching.com. View additional "Crafting a Business" columns here.
Issue #35
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