An online business flourishes or fails according to revenue, so it seems logical that entrepreneurs will prioritize profits over everything else. In this episode of The Sigrun Show, I discuss why “profit first” actually kills your growth as an entrepreneur. There are significantly more impactful techniques to help scale an online endeavour and meet your business goals.
The concept of “profit first,” as written in Mike Michalowicz’s book, Profit First, is based on Parkinson’s Law with principles derived from healthy lifestyle habits. Mike’s philosophy is that business owners and entrepreneurs should deduct their profits from their revenue first, then their salary, then finally, their taxes. Anything left over after these deductions should be used toward business expenses.
In this episode, I tell you why I believe this concept is a bad idea for entrepreneurs who want to grow their online businesses quickly. I also share the strategy I used to build a highly successful online business that broke each principle of the “profit first” concept.
In this episode of The Sigrun Show:
- Why the “profit first” concept is not suitable for every entrepreneur
- How the “profit first” philosophy can affect your business growth
- Budgeting tips to build a big business without using the “profit first” concept
- Addressing tax concerns while growing your online business
Resources Mentioned:
- Profit First by Mike Michalowicz
Key Takeaways:
- Money is your fuel – it’s the fuel of your business.
- As an entrepreneur, you need to be willing to invest forward.
