When I started my company three years ago I thought, this is my change to show everyone how it can be done. This is my chance to do it right! I probably thought that owning a CRM firm was really just doing good, ethical archaeology. Right? Isn’t that all it is? Everything else will fall in line and just — happen?
Not so much.
Sleeping - Or Not
Up until 2015 I only really had one employee — me. For one project I had help from a friend but that was only for a few weeks. In April I hired six people, mostly friends, for a 15,000 acre survey in an area in which I’d never worked. To start the project with some working capital (aka lots of money) I took out an SBA loan for $50,000.
That lasted about a month.
After the money was gone I had to essentially beg my prime contractor to pay on invoices quicker than they usually do. If they hadn’t been good about sending me checks every couple weeks over the past nine months then I’d be in a world of trouble. Still, though, sleeping is tough.
My payroll runs every two weeks and pays on a Friday. On the Tuesday before, I log in to the system and enter all the hours. By Wednesday I get the report that says how much I need to put into my payroll account for the direct deposit withdrawals. That amount not only includes the net amount for each check but the taxes that everyone pays, the taxes I pay (which are equal to what my employees pay) and the fees to the payroll company to keep it all straight.
For a staff of six people, including per diem of $130 a day for that project and $110 for the following project, my bi-weekly payout was about $23,000. So, for the 11 days before I had to submit payroll on Tuesday (I allowed myself one day to not think about it — never worked) my thoughts before going to bed and while trying to sleep were:
payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll payroll…
Hiring your Friends
CRM is a small industry and chances are you know someone in just about every region that you can call on for help. I haven’t had to hire too many people that I don’t know, which is really nice. You get a quality person that you know you can count on. However, it piles on that much more guilt and anxiety when you know they’re counting on you to pay their bills and support their family. They’re counting on that paycheck to be on time and that per diem to be there at the beginning of the session. I know. I’ve been there.
I’m not saying I wouldn’t hire friends again, but, I might wait until things are a little more stable so I don't feel guilty when my heart stops in bed from anxiety and no one gets paid.
The Solution
If I knew the solution I wouldn’t have had to write this post! Seriously though, the solution is to have the money it will take to cover expenses for a project in the account BEFORE the project starts. This is where large engineering firms have an advantage. They can shuffle money between departments quite easily and can keep projects going. Invoices often take a while to get paid and often they’re not paid out until the fieldwork, or even the final report, are completed. That can be a massive financial strain for any small business.
My Priorities
Simply put, my priorities have always been my people. I put money in the payroll account and get the cash out for per diem before I pay my bills, my credit cards, and myself. If you don’t pay your people, what do you have? I can’t do this by myself. I guess I use the Vulcan theory on this one (yes, huge Star Trek nerd), “The good of the many outweighs the good of the one.” So, if I can relieve my employee’s financial worries and take it on myself, that’s fine. If I can always ensure that their pay is on time and their per diem is on time then they have no reason to think anything is amiss. That’s how I’d prefer it. They have a job to do and they don’t need any distractions.
I hope I can get the Archaeology Podcast Network and a couple other side projects monetized so DIGTECH doesn’t have to rely on CRM as it’s sole source of income. I have no desire to be a large engineering or environmental firm so I can’t count on that. Diversifying and increasing income in other departments is the way to go, though.
Also, hiring someone, anyone, that really knows anything about business development is a top priority for DIGTECH.crm. Problem is, I can’t afford to pay them what they deserve right now. That’s a real crappy situation. I need money to pay the person that will bring in the money. WTF? Any business developers out there work on commission???
Any other small business owners out there experiencing the same thing? I can’t be the only one that doesn’t have a clue!
Thanks for reading and I’ll see you in the field!!