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Manny Cosme shows us the fun side of accounting!

Manny Cosme shows us the fun side of accounting!

Today’s guest is Manny Cosme, Manny is the president and CEO of CFO Services Group, a boutique accounting firm specializing in helping small businesses manage their finances. He’s been helping small businesses with their managerial accounting needs for over 20 years.

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Adam Lowe:                       Welcome to the business insight lab where we bring you interviews with leaders in their fields to deliver valuable information for your business. I’m your host Adam Lowe, and this is episode number 11. Today’s guest is Manny Cosme, Manny is the president and CEO of CFO Services Group, a boutique accounting firm specializing in helping small businesses manage their finances. He’s been helping small businesses with their accounting needs for over 20 years. Uh, Manny, how did you get into this business?

Manny Cosme:                  Yeah, well thanks for having me. I’m so, I’ve been in the business for just about 20 years, maybe a little bit more than 20 years. I don’t really want to count, but I’ve been doing this a long time. Yeah, I know. I got, don’t let me count. I’ve been doing this for a really long time. Um, I actually started when I was a teenager. My Dad has a, uh, actually still to this day has a small bookkeeping tax and payroll company, so focusing on all three of those areas and as a kid I would get all excited to be able to go to work with him and he teach me some bookkeeping work and that was a massive nerd, so I loved it. And uh, yeah. So when I went to college I decided, well, I’m just gonna major in Accounting and here I am 20 years later owning an accounting firm.

Adam Lowe:                       Did someone forget to tell you that accounting is really boring when you went into it?

Manny Cosme:                  I love accounting. Well, okay, so, so let me explain there. There are many different areas of accounting. So when someone says accounting is boring, they typically are thinking of a very specific area of accounting, which I do not do. I like to think that I do the fun accounting, which is, which is managing people’s money, which is actually a lot of fun.

Adam Lowe:                       That does sound like fun. I’m picturing a Scrooge McDuck just rolling around in Money,

Manny Cosme:                  exactly. I mean, who doesn’t love that? Right. That sounds good.

Adam Lowe:                       A ton of fun. So, so tell me what, you know, what is it that you and CFO services group does?

Manny Cosme:                  So what we do is, um, so most, I’ll tell you what we don’t do. So most CPA firms kind of focus on one of three. There’s three major areas of accounting. So most CPA firms focus on two of the three areas, the two being either audit and compliance work. Um, so if you think of sort of the bigger accounting firms, they tend to focus on doing audits of other companies for who are publicly traded or kind of things that are like government compliance, kind of things like that. We don’t do that. The second area is tax work. So that’s typically what people think of when they think of their accountant or they say, you know, my CPA, what they’re really referring to is they’re referring to their tax person, right? Who’s the person that prepares their tax return files, helps do tax planning, all that stuff. We don’t do any of that either, quite frankly. I think that’s a little boring. But to edit that one out now. Um, so I, I think the first two were actually parts of the county by the way. That’s fine. You can tell him I said that

Adam Lowe:                       especially around March, April. I’ll tell them that their jobs are extremely boring.

Manny Cosme:                  Yeah, no, yeah, I guess it gets quite well. And then it picks up in September, October because that’s coming up soon. Uh, so those are the two of the three areas, the third area of accounting, which is what we do. It’s management accounting. So that’s the area of accounting. That focus is actually on managing your finances and then making strategic decisions based on your financial information. So that’s the one area that we focus on. We don’t do the other ones because we hyperfocus on making sure that we help you manage your money, which interestingly, a lot of accounting firms don’t do. I don’t know why so.

Adam Lowe:                       Well, you know, you always traditionally that’s what you see inside of big corporations, you know, the cfo and you know that, that, that organization is responsible for managing the money and making business decisions based on what they’re saying and the data that they’re, that they’re collecting. Um, but you don’t typically see that in small businesses and small businesses. Uh, you know, I, I hear about bookkeepers and uh, you know, I hear about like what you just talked about, you know, people that do taxes. Um, so, you know, it’s really interesting to have somebody that comes in with a cfo mindset, um, and be able to provide that to small businesses. So tell me how does, how does all that work?

Manny Cosme:                  Yeah. So, um, and that’s actually exactly what you said is, is what I have found to be true and that’s actually why I started this business about little over six years ago now. Um, I was the, I’ve served in various capacities throughout my career as controller or CFO level. I’m an accountant, so I’m the last position I was the CFO for a large national nonprofit who shall remain nameless, but anyway, I was their cfo and um, this particular nonprofit actually dealt with a lot of small businesses and I constantly found the members of this national organization. I’m the local members kept coming to me asking me for financial advice and so that will, that’s interesting. Don’t you have someone that’s giving you this advice and it came to realize that they had their tax person or they had their audit compliance person, but they didn’t have their management person and so I really saw that as an area of opportunity and so I started asking around to realizing this more and more and said, you know what, I’m going to start a firm that specializes in helping small businesses bridge bridge this gap for small businesses because if anyone needs good financial management, it’s a small business because it’s money.

Manny Cosme:                  You’re growing, you’ve got a let, you know once you’re big you can hire your own internal accounting staff and then you probably have enough money to at least make a few mistakes with and then not be detrimental. But when you’re a small business, I mean you make one bad financial decision. It could literally ruined you, put you into bankruptcy. Exactly. So, um, yeah, so I saw there was a huge need for this. So a little over six years ago, I left my very lucrative career to start my own business and why? I don’t know, but I mean, I’m happy now, but uh, it was, it was breakfast. It takes a while to get there. I’d like to tell my clients that not only am I, a good accountant can help you manage your money, but I also run a business so I can also help you on that site too. I have, I have a very good understanding as to what you go through everyday because I promise you, I probably go through Roman once a week now. So that’s were we moved up. We moved up from, you know, it’s, it’s, it’s top ramen, so good stuff.

Manny Cosme:                  But um, yeah, so, uh, so that’s why I started the firm, but for that reason is that I did see a huge gap and no one was really helping small businesses manage their money and make important decisions. Like, hey, how much do I pay myself? That’s a really important question. How much do you know? How much can you pay yourself were, hey, I want to hire an employee or I want to hire my second employee. Um, what’s that gonna look like for my finances? Right. So that’s an important question, or hey, I’m not sure if I’m charging enough for my services, you know, um, how do I know how to charge for what I do? That’s a really important question and there’s actually a scientific way that we can go about determining that answer to that question. So, you know, these are the questions that people kept asking.

Manny Cosme:                  No one’s really providing answers because your tax person is going to provide this compliance person with bookkeepers because they’re the ones that are in there making sure that, uh, you know, making sure that all your deposits and everything line up with what’s in the bank statements and they’re seeing the day to day stuff too. And I’m sure they give some sort of advice but probably not to the same level that you do. So where’s, where does that line, where is that line? Yeah, that’s a great question. Um, so the difference between a bookkeeper and a managerial accountant is basically this. A bookkeeper can put together financial statements and can sort of do the mechanics of reconciling the bank accounts and making deposits and all that stuff. And make sure you have a good financial statement, but that’s kind of where their expertise ends. A managerial accountant then picks it up from there and takes it to a consulting level.

Manny Cosme:                  So it’s now that you have a financial statement, what do you do with your financial statement? So a typical bookkeeper will be able to produce the statement but not be able to tell you what to do with it. I take a look at the statement and say, okay, based on your financial statements, your businesses looking good, these are the areas that you need to focus on. Here’s some problem areas coming up. How’s your cashflow looking? Okay, you want to open a new location? What’s that gonna look like? What’s your pricing going to look like? How much you going to pay your employees? All those, all those sorts of questions. Bookkeepers typically can’t answer that question. So with what we do, we do bookkeeping of course, because we have to have good information to start with. So there is a book keeping component to what we do, you know, garbage in, garbage out. So we have to have really strong bookkeeping to be able to get to the financial statements, so then we can take it to the next level and answer those kinds of questions.

Adam Lowe:                       Got It. So, so for a small business, you know, I think you alluded to it that, uh, you know, we’re all strapped for cash. We’re all poor and any anybody starting off is going to be really, unless they have money from, from, from other sources, they’re going to be starting off with a really, really tight. So how do you get to a point where, you know, you can afford to have somebody help you make the financial decisions are, or what. I guess a better question would be, you know, what, what are some tips that you have for businesses that are just starting out that are trying to do it on their own so that they can at least get a little bit of traction under their feet before they, even before they’re ready to, uh, you know, play with the big boys.

Manny Cosme:                  Yeah, no, that’s a great question as well. Um, so typically, um, so let me, let me say it this way, um, typically you don’t need the services of someone like us, like a management accountant until you’ve been in business for a little bit and actually have some revenues going when you first started out your business. That’s typically when you probably want to rely on a bookkeeper or attacks and, and a tax accountant because that’s probably what you’re going to be concerned with when, when you first start a business, your finances are probably pretty simple. Maybe you have a few clients that you can probably count on one hand your expenses, everything’s flowing through maybe your personal bank account so you can get a handle on how things are going and maybe even keep track of it on an excel spreadsheet. But once you, I always like to say this, uh, my, our target market for, for my from cfo services group is um, the, I, I say $250,000 to $2 million dollars in revenue.

Manny Cosme:                  That’s like the rough, rough market. And the reason why I say that is because when you hit about 250,000 in revenue, you probably aren’t going to be able to sustain that for very long if you’re by yourself. It’s just, it’s really hard to sustain anything above that level with just one person. You’re going to have to have some outside help at that point. And the minute you start inviting outside people into your company, that’s when things start getting complicated. Now you need money, now you need this, now you need to know how much you’re gonna, pay them and how much are they producing and are they producing enough to pay, you know, and all that stuff. So

Adam Lowe:                       that’s when you start making expensive decisions.

Manny Cosme:                  Yeah, that’s when you start laying out the real money. And especially if that person becomes an employee, I mean they’re going to rely on you to hit that paycheck every two weeks or whatever. So you got to really start having a handle on your money and really understand what you’re doing with it and make sure that you’re charging adequately so that you can pay for them. And now all the overhead that goes along with that, you know, I’d like to say once you hit $250,000, you become a real business as a real business. You need to start doing this stuff. Yeah. Now I know, but we’re all going to get. See, that’s the beautiful thing. Yeah.

Adam Lowe:                       So, you know, you’ve talked a lot about financial statements and being able to make decisions based on that. Can you go into a little bit more detail about what kind of things you look at, you know, when you, when you hit those financial statements in front of you and you have a little bit of an understanding of, of what a business does, you know, where does the, where does the analysis come into play and what does that look like?

Manny Cosme:                  Sure. Yeah. So, um, one thing that we do for our clients is we do a, what I call the quarterly report card. Um, so once a quarter I, myself personally go through all of my client’s files and put together a report card and I look at a lot of different areas of their business. So ultimately give them a grade, if you will, on how well their business is doing financially. Um, so some of the areas I look at, I’m definitely the makeup of your income statement. So when you look at your income statement, there are certain ratios that I want to see as a, as a cfo, I, there are certain ratios I want to see on your p and l for example, what is your cost of sales or cost goods in relation to your revenue? That’s a very important number. Um, what is your sales and marketing budget?

Manny Cosme:                  What does that look like? What are you spending on sales and marketing in relation to your revenue? Is it too high? Is it too low? There’s a, there’s a certain area that we want to be an and typically I’ll tell you, it’s about five to 15 percent of your revenue is what you want to spend in that area. What’s your overhead look like? What are your, um, what is your rep look like? Kind of things like that. So there, there are certain percentages I’m looking at and that can tell you real quick if you’re on course or for trouble. Um, so that’s, that’s one area I look at. Receivables, aging. If you happen to be in a business where you charge other people, you know, after the fact for your services, um, one thing that I look at is your aging. How long does it take for, for your receivables turnover.

Manny Cosme:                  So that means day one, I send an invoice, how many days does it take on average till you get paid. And I will tell you that a good number depends on what industry you’re in and who you’re selling to. If you’re selling to someone like a big company. So let’s say you’re a small business and just have like big company as contractors, as, as your clients. Um, they tend to take a lot longer because there’s a process they have to go through. So I typically will say if you’re within 90 days, you’re actually doing pretty good. Um, if you’re working, if you’re selling to other small businesses, you probably want to be on the 30 day cycle. So you want no more than 30 days to pass before you get paid on average. Um, and then based on that information we can take a look at your practices and then help you get better at collecting money and also make sure that when we do cash flow forecast, which we do every week for our clients, we do a cashflow forecast to make sure that they’re going to have enough cash over the next three months, making sure that when we look at those receivables, making sure that you are going to have enough cash and if you don’t, let’s start working on fixing that.

Manny Cosme:                  So let’s have a plan b ready to go just in case we need to pull some money from somewhere. Um, so that’s another area we look at.

Adam Lowe:                       Yeah, no, I, I love that you mentioned cashflow because that’s one of those things where, you know, newer business owners or people that don’t have any type of a financial training, they don’t get the difference between cash flow and profit. Yeah. Uh, and I know I had this, I have this conversation with my wife all the time. I’m like, hey, we’re profitable. She’s like, yeah, well where’s the money? I promise you just can’t see it when it’s fake money. It’s absolutely true. It’s. It’s one of those things like wrapping your head around it, especially for the small business owner that that’s deep in the weeds every day. Unless they’ve had some sort of training there. It can be a very confusing thing, so making decisions based off of what you see on your bank statements isn’t always usually isn’t a great idea.

Manny Cosme:                  Yeah, no, no, it’s not, and that’s actually where a lot of businesses get into trouble is like, what are you talking about? Had plenty of cash in the bank, but it’s okay, but where did that money come from and what’s the makeup of that money? See, that’s really the important question because if you sold a bunch of, you got prepaid for a bunch of work that you haven’t done yet. You may have a lot of cash in your bank, but six months down the road you may be broke because you didn’t really account for that money properly, so you have to be really, really careful about that. And that’s where like managing your cashflow comes into play, you know, you need, you really need to be managing that as a small business.

Adam Lowe:                       So what other kinds of things do you see that, uh, you know, small businesses do to get themselves into trouble and how do you keep them out of trouble?

Manny Cosme:                  Oh, well, you know, I wouldn’t say the number one thing I think that small businesses do wrong is pricing. I think a lot of businesses get their pricing right and that you know, that that can sink you obviously really fast. Um, if you really don’t know what you’re charging for your services. And like I said, it’s not, it’s you don’t, you don’t arbitrarily decide what you’re going to charge someone for what you do. There’s, there’s a way that you can figure out using some formulas and all that stuff. But the basic things. Yeah, exactly. Yeah. Yeah. No, but people need like that. That’s the one thing I would say is that you just get price pricing rather than. It just all flows downhill from there. And you’re wondering why you can’t hire someone or you’re wondering why you’re struggling at the end of every month to make ends meet is because you just need to get better.

Manny Cosme:                  So that’s definitely, I’m a big one. The other one I would say that, um, a lot of businesses do wrong, especially if they, um, if they do invoicing is they don’t follow up on their collections. And so they ended up with really long receivable turnovers and sometimes they don’t even end up collecting all of that. And so, um, that’s one thing that we are really on top of with our clients is making sure that literally, probably every week we’re reaching out and like, Hey, where’s this? Hey, where’s this money? We make sure we get that money in the doors that we can use it for things. So, um, yeah, that, that’s a big one.

Adam Lowe:                       So tell me a little bit about, you know, what small businesses can do to either get money to start up, start up the business or, you know, take on a new initiative or to, to, to grow their business.

Manny Cosme:                  Um, okay. So traditionally, typically when people think of getting money, what’s the first thing you tend to think of? Where’s the first place you tend to want to go? The bank. The bank. Right. Okay. So typically people are like, Oh let’s go to the bank. That’s actually the wrong place to go. I would tell you that nine times out of 10 you’re probably wasting your time and spinning your wheels and then just creating more frustration for yourself. Because banks, it’s really hard to get money from banks unless again, you have money, right? Or you know, you have a lot of assets or anything like that. So for a small bit, and I dunno, I dunno about you, but most small business owners I know based probably have bad credit if not a bankruptcy on their record. They have no assets at all. They basically bet everything on this business.

Manny Cosme:                  So they have nothing. So they go to a bank and typically they get left back out the door. But basically they’re like, oh that’s really nice. Thank you for thinking of us. But come back when you have a million dollars in receivables and then we can, we can talk. So, so the people that need money can’t get it. And the people that have money, well no, you can get it. Just, you’re not going to get from a bank so that, that’s the wrong place. It goes. Oh yeah. I always say like, don’t even waste your time going to a bank when you need money. So there are other places that you can go where they will lend you money. Um, so the very first place you should always think about going when you’re a small business is go to a community development investment fund, a CDIF. So a cdif they exist in every major city in the US.

Manny Cosme:                  Definitely. And then even some other places, um, a Cdif community development investment fund does exactly that. What they do is they are quasi private public institutions that exist to spur economic development in a community and typically mostly centered around businesses. So they exist essentially to help create small businesses in the community. And so because of that, one of the things that they do is, is lend money to small businesses and because they are, some of it is private money and some of it is public money, they are very flexible and how they can spend their money and who they can give loans to. So typically they will give microloans, which in the world of accounting means up to $50,000. Um, but they will typically, if you need money, you can go to a community development investment, fund the CDIS and apply for a loan of up to $50,000 and most likely you will get the loan unless there is something really, really, really wrong.

Manny Cosme:                  And bankruptcy’s included, uh, they can even sometimes get, even if you have a bankruptcy on your record, you know, depending on the circumstances. And you know, because they are also see banks are very regulated so they have to go strictly on numbers. CDIS are tend to be more interested in your story. What’s your story? Why did you start this business? How is it going to help the community? You know, tell me about this blip you had in your financial record. If you have a good story and a good business model, then they will typically lend you money and it’s not a lot of money, but $50,000 can go a long way when you’re a small business and really good and with really good loan terms, they’re very easy to work with and they also, um, because they’re, um, community and interesting community development. They also do a lot of education as well.

Manny Cosme:                  So you can take a lot of classes. Um, I work with a CDIF here in DC. I will help their clients sometimes pro bono. I’m helping them manage their finances if they’re struggling, um, or do classes or things like that. Um, so that, that’s the first place I tell people go like, go to your local cvs. So here in DC, um, it’s called the wakeup. Why shouldn’t Washington area of community investment fund wake up and they’re actually on Rhode Island Avenue like way down Rhode Island in North Northeast, I think Rhode Island. Um, yeah, over in the northeast are there. So, um, yeah, so that, that’s a great source. Um, the second place to go after your community development investment funds is um, you can go to like a. So if you run a retail establishment, I’m a retail business, so you know, you’re selling things at retail or owned a bakery or something like that.

Manny Cosme:                  Um, and you happen to use square as your point of sales. Software Square actually now has a capital program. Yeah. So you can get a loan from square, I think, again, up to $50,000 with a really nice interest rate and square will actually loan you money. They’ll deposit in a bank account. And the cool thing about that is that every time someone makes a purchase now at your store and they swipe their credit card through square square will take a very fraction of that and use it to pay back the loan. So you don’t even see them. The loan being paid back over time. And it’s actually a really amazing feature that they do. It’s really, really cool. Yeah, that’s wild. Yeah. So like, you know, someone buys $10 worth of stuff, they’ll take fifty cents and apply it to the loan and the rest will go into your bank account. So yeah, so it’s a really nice way. You don’t really notice the money, the loan being paid back over time and they’re very generous with it because they know that it’s, it will be paid that

Adam Lowe:                       your history there, they see what kind of money’s coming in. Yeah,

Manny Cosme:                  exactly. Yeah. So square does that. And, and I’m with her now, which is a competitor to square. They also are now doing that, I believe. So that’s another really great source to get to get quickbooks capital. No, everyone’s getting in kappa cabbage, which is a really big loan company. They do really, um, really easy financing for small businesses. Again, even if you have horrible credit, they will typically still lend you money because they are interested in the financial history of the business and not have you personally. Um, so anyway, the point is that there are a lot of ways you can get money. I always tell someone, if you really need money, I will find you money. That is, that is usually not a problem. I don’t care what your financial history is. Someone out there will loan you money, I promise you. So it’s not, and it’s not going to be the bank. So,

Adam Lowe:                       you know, you mentioned the company story and that sounds a whole lot different than what you would need going to a bank and having to bring in all your statements and taxes and blah, blah, blah, blah, blah. What kind of things would you need to come in to a cdif a two to help them come to a decision whether or not to loan you money?

Manny Cosme:                  Oh, I’m so, but the CDIF um, so they, they want to see your financial statements for your business. So they want to see kind of, you know, where you’ve been, how long ago did you start the business, you know, how’s it going? Um, and then that’s where someone like us could prepare the financial statements to show them how you’re truly doing. Um, but again, they also want to hear your story. You know, what’s Your Business Plan? Okay, so you’ve had this business for a year or two. Um, what do you plan on doing with it? What’s your marketing plan? You know, what are your financial projections? Because are you going to be able to grow the business? Are you going to be able to earn enough money to pay us back? Which is, which is good because you also don’t want to get a loan that you ultimately won’t be able to pay back.

Manny Cosme:                  So, um, they, they want to know what your cashflow going to look like. Right? So that’s, that’s what they want to know. And then like at wake, if I believe it’s actually a panel of people who literally will sit there and discuss your case basically, and it’ll be like three people and they’ll sit around a little table. And what way do you think. Well, I think, you know, I think he has a good story. He looks like an honest and you know, and he was financials look okay. And he has a good story, you know, and so they’ll, it’ll actually be a person discussing this amongst other real people. You know, it’s not just a, it’s not an underwriter, New Jersey somewhere who’s, you know, hates their job and it doesn’t really, you know,

Adam Lowe:                       having a bad day denied.

Manny Cosme:                  Yeah. You know, deny, you know, or put into a computer algorithm and it spits out a, you know, an automatic response. So these are real people who are interested in building the community. And so, and then even if you, you know, they’re like, well, you know, we think they have a good business plan to financials could be stronger, you know, we’re going to go ahead and give them alone, but we also want to. But we also are going to require that they meet with a financial person to do their accounting. And so that’s where the tip, sometimes they’ll reach out to us and be like, hey, we want to give a loan to this person, but they’re going to really need your help in managing the money and making sure that they make good financial decisions. And so, you know, they’ll also do that because they’re, they’re interested in the longterm growth of the community. And so when they give you money, they’re going to want it, always do it through that Lens, which is great, I think.

Adam Lowe:                       Yeah. Yeah. So let me just switch gears a little bit. Um, because you, you mentioned excel and this is a conversation you and I had a couple of weeks ago was, you know, a lot of these small businesses that feel like they can just, you know, run, run all their financials in an excel spreadsheet and makes me laugh. You know, I feel like you can’t get more than a lemonade stand on an excel spreadsheet. I tell you, I’ve seen some really, really complex, convoluted things and um, just talk to me about your feelings on that. And you know, like if you’re doing it on excel, what should you really be doing?

Manny Cosme:                  Well, you really shouldn’t be running your finances if you were, um, uh, you know, I mean, when, when you’re. So when you’re a start, a small business starting out, like I said, you, you probably have a good sense as to what your finances look like anyways. You can count the money coming in and pretty much know what your expenses are going out so you can use excel just to kind of like, you know, just informally keep track of all that. I would, I would also recommend if you want it to starting out, if you want to do your own thing. Also use quickbooks, so quickbooks online, some people don’t know this, but a quickbooks online actually has three different versions. And so, um, there’s one version that’s called, I think simplestart is what it’s called and it’s, it’s actually a really watered down version of quickbooks that’s super easy to use.

Manny Cosme:                  And so if you’re going to do anything I would say, and I think it’s like five bucks a month, if anything like that, I guess super cheap. Um, I would say just actually do that instead. And the nice thing is a, and it makes sure you open up a separate bank account because what you can do is then hooked that bank account, quickbooks and it will automatically pull the transactions for you. And even if you don’t really go in there and, and massage the data, um, it, it’ll still give you a pretty good sense of how your business is doing at least. So at least you have something to start with. So when you’re ready to graduate to the next level and hire us, then at least you know, you’re not starting with zero. You have some sort of something that you can.

Adam Lowe:                       And that way when somebody asks you for a, you know, your, your, your, your financial statements, you can at least run a pnl, you know, you can get them the basics without having to go back and spend 10 hours trying to massage your data and go back through a, you know, a year’s worth of invoices to figure out where the heck you are.

Manny Cosme:                  Exactly. Or when, you know what, I need a loan. And uh, okay, where are your financial statements? Oh boom, here you go, here’s my financial statements. Or even at the end of the year when you go do your taxes. Okay, here’s my financial statements. So I mean, it’s definitely better than nothing for sure.

Adam Lowe:                       Yeah, definitely. So, so what other kinds of advice do you think you’d be able to give for a small business? So for somebody that’s somebody that’s transitioning from that sub 250 mark to, um, to, to the point where they, they can afford you, they, they sort of need you, um, what does that transition period look like and what does onboarding look like? Uh, you know, what, what should people be prepared for when they start looking at their money? I’m like a grownup.

Manny Cosme:                  Let’s see, that’s a good question. What should people be prepared for? Be prepared to ask a lot of questions. Um, one thing that I wish I would get more of his questions from my clients, um, because finances are complicated and when you run a business, especially once you start really growing your business, when you’re small, there’s a lot of moving pieces, but you can generally run everything yourself. Like you, you know, you can, you can kind of juggle all the balls in the air, right? But as you grow, that becomes harder and harder. Like now I have seven employees now. I mean, I can’t do everything myself. I have marketing, sales, this, that, you know, a lot of other things going on. Um, so the last thing I want to do myself is do my own accounting, you know, because you know, it’s, I have a lot of stuff to do, nor am I going to really sit there and then once I do my accounting and pour over my financials, right?

Manny Cosme:                  So that’s why we outsource things. You know, I don’t really, I do some marketing myself, but I don’t do, I don’t go too in depth with it because I have a marketing professional and I rely on. So it’s the same thing with finances, but you need to understand your finances and I think that’s another thing that people go wrong with is that they’re so busy juggling everything else that they start neglecting their finances and if there’s anything that’s going to get you in trouble really fast and a business, it’s your finances. You have to really be on top of it. And so using your, you have to learn how to start using your consultants wisely. And that’s any consultant, whether it’s marketing, sales, accounting, you know, whatever. Um, you have to start using your, leveraging your consultants and so when it comes to finances, as you grow, really relying on that cfo type person to analyze your finances and get into a discussion with them on a periodic basis and check in how am I doing, how’s the business looking? Are there any danger areas? How’s cash flow? Are we going to need some cash soon? You know, have those conversations periodically so that you don’t run into trouble.

Adam Lowe:                       Well, you know, you’ve raised a really good point there and that you’re paying for consultants, you’re paying for outside help and you’ve got to really take advantage of that and it can’t just be a hands off thing. So it’s not like a business can just come to you and say, you know, here’s, you know, here’s, here’s my books. Go, go do my financial cfo stuff. No, they, they do need to be a little bit involved. Um, and you know, asking the right questions and using you the way that, that, that you need to be used. What are some, what are some of those questions that you find that people should be asking, that they’re just not, that you have to prompt them on and that, that you find yourself raising over and over again?

Manny Cosme:                  Yeah, and there’s a lot. Like we, we really try to be preemptive with our clients and really try to put things in front of them to be like, hey, we really need to have a discussion about this. But again, at the end of the day, I mean, finances are complicated. Businesses are complicated and I can never know. I, you know, I’m not a mind reader. We are, we are not mind readers, so we don’t know what you’re really struggling with in your business. And so, um, so some questions to that effect can be like, Hey, I am struggling with my cash. I don’t feel like I’m, I, I don’t feel. I feel like my business should be more profitable. Sometimes you see as a business owner, you really have to listen to your intuition also because sometimes you kind of intuitively feel like something should be different in your business, but you don’t know what.

Manny Cosme:                  That’s a really good time to touch base with your financial person and be like, I feel like my business should be more profitable, but I don’t know why and I don’t know where it could be. And it’s like, oh, great, okay, well let’s take a look at this and there are several things we can look at, right? Or I feel like my prices should be higher. Okay, great. Or I feel like I should be paying my employees more or I shouldn’t feel like I should pay my employees and less or things like, are my employees, um, are they efficient enough at what they do, you know, do I have too many people on staff and I should have less maybe and get more efficient with them. So kind of things like that.

Adam Lowe:                       And Monday’s got such a stigma to that. Imagine having those conversations with, with the consultant is just a difficult thing. Especially for a small business where they can’t necessarily pull themselves away from it. There’s ego involved.

Manny Cosme:                  Yes. Oh very. Oh my very, very, very true. Yeah. And, and that’s why like, uh, when we do financial consulting, you know, my, my approach is always I kind of present the information and then it kind of just leave it there and I let you ask the questions that you feel like you want to ask because I mean I will tell you sometimes people, people get very emotional around money and sometimes people don’t want to have the conversation and um, and it’s very important to honor where everyone is in their, in their, where they’re at, their finances emotionally. And um, you know, someone doesn’t want to get into a conversation then you just kinda leave it until they’re ready to have that conversation because if you do, it’s just not going to go anywhere. But anyway. So, um, but it’s important that they have the information, at least you know, to look at.

Adam Lowe:                          Exactly. Yeah. I’m sure when, when something’s important enough than you, you will raise it. Then you’ve got to be delicate about how you do that. Exactly. Exactly. Yeah, yeah, yeah. Money is. Money is a very interesting thing. Lot of emotion around money. And especially now if it’s your business, yeah. That then that’s like a, it takes it a whole nother level because then you’re just feeling like, you know, okay, well this is, I’ve poured my heart and soul into this. This is my identity.

Manny Cosme:                 It’s part of you. So it’s, yeah.

Adam Lowe:                       You know, as a small business owner myself, you know, I, I feel at the same way when I have down months than I have to really look at, you know, what caused this wasn’t me, was it an external thing? Was it, you know, and, and, and it’s uh, it’s a tough conversation to have even even with yourself. So you know, having somebody else’s even more difficult.

Manny Cosme:                  Exactly, yeah. Oh yeah. I can definitely get very emotional, like egocentric and you know, can go to a really dark place, but at the other side of that it can go to a really great place to.

Adam Lowe:                          Well that’s why we have whiskey.

Manny Cosme:                  Yeah, exactly. Exactly. Look at their financials in the world would be such a nicer place. Right. So any other money tell that you went to a that you want to share with us before we hit the lightning rounds? No, I think that’s good. I mean there’s a lot of great questions. So I think those are the big questions that I typically get. So yeah, that, that’s awesome.

Adam Lowe:                       Yeah. So the big takeaway is that if you don’t have somebody helping you with your money on your finances, you need somebody, um, no matter how big or small you are, you need somebody that understands finance because you probably don’t.

Adam Lowe:                       So yeah, so you definitely need somebody there that knows what they’re doing and can advise you a, you know, even if they’re not in it, um, you know, day to day, uh, it’s, it’s something that the, the typical business owner just really doesn’t have the capabilities to do themselves unless they have that strong business background. Absolutely.

Manny Cosme:                 Yeah. Business. Businesses exist. People start businesses for many reasons and one of those reasons is money. It’s a profit motive. So make sure you’re profitable, make sure you’re watching that money.

Adam Lowe:                       Very important, very important part of business. It’s nice to be profitable. All right, so you ready for the lightening round for me? Oh, sure. Cool. Um, so if you could give one book to everybody that you meet, what would it be and why?

Manny Cosme:                  If I could give one book to everyone, uh, it would be a power of now by Eckhart Tolle. So tell me more. One of my favorite books. It really grounds you in what you’re doing. And now because, uh, especially as a business owner, we tend to deal a lot in the future with worry and a lot in the past with regret. Like, Oh, I should’ve done that. Different should handle that client in different or what’s going to happen next week, next month, next year, how’s my business going to go? So it’s very important to maintain your anxiety and that happens by sticking in the now the present moment where everything is good.

Adam Lowe:                       Don’t they say depression is living in the past? Anxiety is living in the future and peace living in the present.

Manny Cosme:                  Exactly. Very Zen. Yes, absolutely. My. When I. I’ve read that Book Probably Twenty Times in every, every few months. I kind of go back and reread it. So cool. I’m an audible nerd so I love asking that question because my reading list just gets longer and longer. I would never recommend listening to it though because Eckhart toll has a very monotonous voice. It’s very soothing, but it will put you to sleep really fast, so trying to look like. Is it like trying to listen to a Peter Drucker book? Yeah, exactly. Yeah, exactly. You’re like, oh my God, this is great information, but you’re putting me to sleep.

Adam Lowe:                       I think I read it the effect of executives at least once a year. Um, but I just can’t imagine doing that one on audio book. I would put me to sleep. Yeah, exactly. So you already touched on this a little bit, but I’d like to see if you have any other thoughts. You know, what’s the biggest mistake that you see business leaders make?

Manny Cosme:                 Not asking enough questions. Yeah. Not, not asking questions of people and, and really, um, and I’ll, I’ll, uh, second part apart to that is I’m not managing your people correctly and what I mean by that is not really understanding what they do and if they should be doing that and if not what they should be doing for you. That’s huge. Like I think that’s the key to business. You got, you got you gotta understand how to use people effectively in business. That’s a great answer. And we could probably go for, it can be about that.

Adam Lowe:                       So, so you’re not allowed to say your phone, but what’s one tool or a piece of technology or something like that or methodology or something like that that you feel like you couldn’t live without?

Manny Cosme:                 For Business or for fun? Let’s keep it for business and then, uh, and then tell me for fun on my computer, but wait, what’s one piece of technology

Adam Lowe:                       or a tool or a methodology or you know, what’s, what’s one thing that you feel like is just so integral to, you know, you, you running your business and you being successful in your business?

Manny Cosme:                 Well, quickbooks, quickbooks, quickbooks. That’s pretty integral. It’s fair enough. It’s the program we all love to hate. Yeah. Yeah. No, that’s pretty integral to my business. I’ll say that. Actually. No, I have a better answer. I have a better answer mine with sticky notes if that, if that helps you any. No, no, actually no. I’ll tell you actually the number one, I would say the number one piece of software, she’s a software that we have in our business is called Robo forms. It’s a password management system. We have probably a thousand passwords for all of our clients for various bank accounts and this and that and that. Right. So I have about a few years ago when we started to grow, I was like, we need a password management system. So I found a robo forms and it’s amazing. It’s pretty great. It’s amazing. Especially imagine us like all the information we have. It’s perfect.

Adam Lowe:                       Same thing with all my clients, you know, and, and God knows how many different systems to log into and actually it doesn’t fit on the back of a napkin anymore, unfortunately. Nor nor do you want that in an excel spreadsheet. It’s not very secure. So just to stick a note under my keyboard, one password that I use everywhere. Exactly, exactly. Um, so if you could have lunch with anybody dead or alive, who would it be and why?

Manny Cosme:                 I have lunch with Oprah. I would say oprah, Oprah. She had heard fabulous. Well, she is pretty fabulous. I love her story. I just think she has such an interesting story of where she came from. I mean, just her sheer persistence and just knowing where, who she was and where she wanted to go and just knowing her own power and um, and then just, you know, her, her, just her spiritual power as well, just like I said, just she just knows who she is and I just, I think she’s amazing. That’s a great answer. Yeah. Amazing person. And then tell me a fun fact about yourself that people might not know. A fun fact. I’m a video game fanatic. Love, love games. So yeah, especially roleplaying games. So, uh, I, I definitely liked, like in my off time when I’m not working on my book, you’ll probably find me on a playstation four somewhere.

Adam Lowe:                 So what’s your current favorite game?

Manny Cosme:                 Oh, final fantasy 14 online. Oh really? Oh my God, I played it. Uh, it came out like years ago and uh, every, it’s like every few years I kind of go back to it. So this is probably my third time around planning that comfortable place. Yeah. It’s just, it’s such a fun and you know, it’s still going strong. It’s such an addicting, literally an addicting game. It’s so much fun and I tend to like to be the white male age. I’m, I’ve always been drawn to the white middle class. I like to heal. I don’t know. I should probably be a therapist in another life or something.

Adam Lowe:                       I’m sure there’s somebody that could psychoanalyze your, uh, your choice of characters that I know exactly. Like, Oh, you want to be a black man? What does that tell you about? Because I love video games too. I just don’t have time to play them anymore. Especially with the one year old at the house, so I had to live vicariously through other people and I’m kind of addicted to the gamers with jobs podcast. Have you heard of that one?

Manny Cosme:                 No, I don’t watch the game or a podcast though. I know I, I don’t watch the podcast or I don’t listen to the pipe

Adam Lowe:                       gamers with jobs. It’s awesome. It’s just a bunch of grownups talking about video games, you know, like in an adult setting and with actual adult thoughts and a 14 year old screaming, screaming obscenities at each other. I know that’s pretty cool. One of my way into a BNI meeting this morning and you know, one of the women was saying how her three and a half year old, she. She got one of those little little super nintendo things. Let’s do the snes classic know the Minis I have for one of her older kids and the three and a half year old is playing super mario or something like that and she’s just amazed how well this little three and a half year old can play as a brand new parent that, that blows my mind. My, my little dude right now. Can’t even eat dinner without putting a fork in his eye.

Manny Cosme:                 Just wait. Oh yeah. Kids these days are, are great. Actually, it’s funny because I have, I have the Super Nintendo mini as well and I got it like about a year ago and I used to play all these games and I was younger and that was really good at them. But it’s funny because I feel like now I try to play it and I’m horrible at them and I think it’s one of those things like as you get older you just get worse and worse that they, like, I just, you know, and I think maybe it’s a patience thing where just like I just don’t have the patience for it. Nintendo hard for a reason.

Adam Lowe:                       So, uh, so tell me, how can, how can people reach to you if they’re interested in working with you?

Manny Cosme:                 Best way is a hit my website,

Adam Lowe:                       CFO services Awesome. Thank you again so much for being on the podcast today. Yeah, thanks for having me. This is great. Awesome. So I hope you enjoyed this week’s interview. To learn more about me and my business, you can visit me online at www dot Adam Lowe, If you enjoyed this podcast, I would love it if you could subscribe and give us a five star rating on itunes, Google play or stitcher radio. Just search for the business insight lab or go to www dot Adam Lowe,, forward slash podcast, and click the links. Have a great week and we’ll talk again soon.


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