Episode Transcript
[00:00:01] Speaker A: Hello, I'm Jeremy Rivera, your unscripted podcast host. I'm here with Megan Wall, who's going to introduce herself, her company, and tell us why we should trust her in her industry.
[00:00:15] Speaker B: Hi, everyone. I'm Megan. I am the founder of the Hot Girl cfo. We are a boutique accounting agency. We offer fractional CFO bookkeeping, and now taxes. Freshly launched the tax arm of my company at the beginning of the last month. It's been amazing, and you should definitely trust me because I've been in finance for over 15 years at this point. I know my way around the industry as far as, like, bookkeeping and creator economics.
Online service provider bookkeeping is our specialty.
So marketing agencies, creator, like representation agencies, you know, like, like talent kind of representation agencies. They have influencers. All of that jazz is our. Those are our jam.
[00:01:09] Speaker A: Curious about the concept of fractional and how is that different from a freelancer or how is that concept, is that just allowing you to come into the corporate constellation with a particular title and hold the reins that way versus being seen as just a h agency to do finances?
[00:01:33] Speaker B: Yeah. So in my mind, I see fractional more as, like, it just means that I. I'm the CFO for multiple companies and not just like the CFO for Apple or like the CFO for, you know, Google or whatever.
So I. I'm able to serve multiple companies at once as their cfo. And the agency aspect is definitely more on the.
More on the side of, like, when you come to work with the hot girl cfo, you get a bookkeeper, you get a CFO and you get a tax person, and that's like your hot girl finance team. So.
[00:02:07] Speaker A: Okay, so you have a whole team stack of. It's not just you. You're also bringing multiple roles into the. Into the position at the same time.
[00:02:19] Speaker B: Exactly. Yeah. And that's. That's really more of a new development in our company.
I started out as a, you know, solo project and was doing all the CFO and the bookkeeping, and I still do a lot of it. I still am a bookkeeper, and I do. I, you know, review the books before they go out to the clients. And I am the main fractional CFO right now, but I have a bookkeeper underneath me, and I have a tax teammate who does all the taxes. She's excellent. And yeah, it's been really fun to kind of progress into more of an agency structure instead of just a me. We're now a we.
[00:03:01] Speaker A: What's the biggest friction that companies are experiencing where you come in and you can add some oil to that situation and make it smooth where it's been rough before.
[00:03:17] Speaker B: Yeah. A lot of my clients come to me because they don't have insight into their offer suite profitability.
So usually bookkeepers are grouping transactions into you know, one top line revenue account and then you have all of your expenses and there's really no way to tell okay, what am I making from this offer? What am I making from that offer? And with the CFO level support and insight, it's we're able to first of all separate that on the P and L and in the books so that you're getting that more in depth.
Look into your numbers as well as I create dashboards for my clients that track specific profitability of each offer. So that's a big one. Especially for my larger coaches where they have like a ton of different offers. They may have digital products, they may have, you know, group offers and a one on one and all of those things.
We track each, each individual offer.
[00:04:16] Speaker A: Here's a soapbox for you to stand on and speak to all of the businesses that have finances.
They all do but focused on that, that niche. What is your hot take?
[00:04:33] Speaker B: I have a couple but my like biggest pet peeve and I look, I get it but co mingling funds with business and personal when you're at the seven like you know, high six figure into the seven figure mark of revenue, it's just a no, no, like, like you just cannot have clean books. You cannot have a clean insight when you're mixing your personal and your business. And I will die on that hill.
I have a couple clients who refuse to clean up and I'm like look, you know better, I've told you better.
[00:05:11] Speaker A: And is that cuz you just, you're seeing you're not able to, to account for which expenses are which and if there isn't really a good reason for it to continue other than just sloppiness like it would take a quarter of a, of a day to set up separate accounts, you know, that are truly just personal. Right, right.
[00:05:34] Speaker B: Well it's not necessarily that I can't account for the correct expenses either way. It's more like the structure of your business, the legal structure of your business absolutely breaks down if you are commingling your funds. So if you have llc, if you have an S corp, if you have a C corp, any of these things you are indefensible. If you are coming commingling your funds, if somebody comes after you, it's, it doesn't make sense. To even have those legal structures or those legal protections. If you're going to mingle, if you're going to put personal in your business,
[00:06:07] Speaker A: that definitely makes sense when you're brought on to the team.
What's the low hanging fruit? The things that day one or week one or month one that you're sorting out, aside from, hey, get your hand out of the cookie jar, put it into a separate cookie jar and anything business is in business, you want to spend stuff, great. Just, you know, arrange your way of transferring it out, you know, whether that's payroll or whatever. So aside from that, what's that low hanging fruit? As a new CFO coming in, what are your aims to clean up shop?
[00:06:45] Speaker B: We definitely clean up the bookkeeping.
You know, as an agency, you come to us for pretty much the whole team. We don't.
This is a part of the new structure that we're implementing. It's like instead of doing, we, you know, offering, we just offer bookkeeping or we just do taxes or whatever it is, we're now offering the all or nothing kind of service where you come to us, you get the whole thing. We're not gonna, I'm not gonna come in as your cfo. If you have a bookkeeper, you'll get my bookkeeper. So, so that's kind of the first thing we do is dive into the books, make sure that they're super clean and like I said, defensible if anything were to ever happen, like an audit.
And then from there we're setting up bank accounts. We are making sure that things are like in the ecosystem of the bank accounts and in the ecosystem of the like the micro economy. I like to think of it as a little micro economy of a business and things are moving fluidly.
[00:07:50] Speaker A: Curious about geography. Like, I work with the, you know, permacast concrete wall company in Florida.
They provide services nationwide when it comes to bookkeeping. You know, like I, as a freelancer myself, you know, I'm just taking stuff in.
How much bas. How much does finances change based off of where your business is physically located versus where you're doing transactions?
[00:08:22] Speaker B: That's a really good question because it. Depending on like your nexus and depending on where, where you have employees or like where are you physically located, you could owe sales taxes in different states. So as far as like bookkeeping goes, we offer services nationwide and my tax teammate, we also do taxes nationwide as.
But as far as like the business being in one state versus another and like having physical presence, there's a lot that goes into like sales Taxes and most services are not taxed through sales tax, but in some states they are. And digital products are taxed differently in different states. So that's a huge thing to know.
[00:09:08] Speaker A: Yeah.
Are there any like honey pots or any states that are particularly troublesome or particularly trouble free? Like I'm in Tennessee and I know our, you know, we don't have a state income tax, which is definitely different from when I was in California.
So what's the top three most difficult states for business finance?
[00:09:35] Speaker B: Yeah, so difficult.
California is definitely one of the most difficult for sure they have there.
When you record and like register and remit your sales tax, you have to input every single county that you sold, like how much you sold in every single county of California, which is a huge task.
But for sales taxes specifically, California is, is a bear.
And then I will say like Texas has no state income tax either. And neither does Delaware. I believe that's where lots of people. That's like a haven for a lot of people who want to create corporations. Go to Delaware.
[00:10:22] Speaker A: Makes sense.
There isn't much other call to go to Delaware. Look at me, I'm in Delaware.
Talk to me a little bit about your personal journey. Like where have you come from?
Did you always want to get into finance or were you a young child playing with an abacus in front of math class? Or how did you fall into this particular career?
[00:10:53] Speaker B: I did always enjoy math, but you would be surprised how little math there is in accounting, honestly, other than like addition and subtraction.
I wanted to be Indiana Jones when I was a kid and like I wanted to be.
Also wanted to be a csi, was obsessed with CSI and actually went into college going toward a biology degree so that I could go into genetics and be a csi. Cause that's what I wanted to do.
But then I think there is a
[00:11:28] Speaker A: bit of forensics in mapping profitability and looking at the marketing side.
How does that work out? What is your role in these conversations talking about, you know, I think it is definitely, you know, a difference between hey, give me your papers, we'll line up these numbers. But you talked about profitability per line. What do some of those conversations work out to? What does that relationship look like with C Suite or whether it's. Or is it more of relationship with individuals who have small businesses that you're working with and talking about those concepts of profitability, giving advice or direction or just giving useful information of hey, this, this thing you're doing over here that's making all your money versus this thing you're Spending all your time on is not making money, right?
[00:12:23] Speaker B: Well, I think there is.
So I work with small businesses. I work with the 500k to like multi million dollar businesses. And I know that sounds like a lot of money to a lot of people, but in the grand scheme, that's a very small, small company.
So I work with a lot of solo CEOs with maybe small teams. And they.
The operating margin is so small and they're running things so lean. Leanly that the conversation about profitability per offer has to be had, especially if they are putting in their own hours into the offer itself and they're not having team take care of those offers like you know, ce the. The founder hours are worth more than.
Than they used to be when they were solo. So a lot of the conversations around profitability happen where I'm giving them the information first and then I'm asking them, okay, how much do you want me to tell you what to do right now?
Because some of my clients are like, okay, I have the information, I'm gonna do what I'm gonna do. And then some clients are like, you're the money mommy. Like, tell me what to do, I will do whatever you say.
That is like, you know, I have very.
The personality varies greatly across all of my clients.
[00:14:00] Speaker A: Good to know.
What are some of the biggest catastrophes or the worst scenarios that you've encountered where you've been able to right the ship for somebody that came on board,
[00:14:16] Speaker B: Bookkeeping is a big one. People come to me with the most, like treacherous. I don't know if treacherous is the right word. It's like when I go into the books and I see what a previous bookkeeper has done, it devastates me. So cleaning up bookkeeping and especially if you have multiple years of back taxes that you haven't filed and we're going in. One of my clients who is a accounting.
She is an accountant and she is an accounting company. She does taxes and bookkeeping too. She came to me and we did all of her books back to 2021.
And she's a. She's a big offender when it comes to commingling as well. So we have that conversation a lot.
[00:15:08] Speaker A: I feel you like when I was talking to Chris Tweeten of Spacebar Collective. He does like Calgary SEO. And one of the challenges of being in my particular niche is you're taking over the reins of somebody else's work and it's.
You're often inheriting a mess and cleaning up kind of damaged relationships before you know, so Part of it is rebuilding that trust. And you know, a lot of times that means going through extra filtering or having extra conversations to show them. Okay.
You know, we, yes, there are disreputable SEOs who don't do things right or do things that are risky or, you know, but that doesn't mean that we all do. So I definitely feel you on that. Hey, you get your last bookkeeper.
How to say this politely? Sucked.
[00:16:03] Speaker B: Yeah, we need to have this conversation. And also it's like, and it sucks because, you know, people, people are bad at their job in every industry. But when you hear about a particularly bad bookkeeper, particularly bad accountant, it makes us all look bad and makes it seem like we're all cold and can't explain things on a normal, like casual conversational level. And, you know, all of the things or will shame you or any of those. It sucks.
[00:16:34] Speaker A: I'm curious about some of what I think of as like the bigger ticket windfall type of professions where, you know, like a realtor or a lawyer, you know, they're not necessarily looking at such like a regular consistence. They're like hitting big windfalls here periodically.
What's your advice for the folk who don't have, you know, that, that biweekly, easy cadence with their clients of like, okay, well, you know, this is the billing schedule and it's coming in like I have X clients and they're paying on these time frames versus, you know, mother load comes in and then stretch and then hitting another one.
[00:17:24] Speaker B: Yeah, it's all about cash flow. I, I always say that cash flow is queen and it's also baby, right? So like everything you do is like in the name of your cash flow. So if you have those huge spikes, like, like I'm also in the spike, you know, category as well because all my clients pay me on the first and then I have very little revenue coming in through the rest of the week. So I, I mean other people have much longer runways for revenue. As far as like, like realtors, like you said, like they may sell a couple homes a quarter and they're getting these huge in influxes. But so cash flow, you're doing everything in the name of your cash flow. So when you set a price point in your business, when you like launch a new offer, having that in mind of what, where that's going to fall on your monthly cadence as well as expenses. Get all of your expenses.
You can, I'm like blanking on my words today.
You can negotiate your expenses.
Like you can negotiate anything. Like you can Ask them if, hey, can I pay this on the 1st? Or hey, can we split this up? Like if you pay a contractor specifically and normally they would charge you a retainer rate of $2,000 a month at one point in the month.
Ask them if you can do it weekly, if you can pay them $500 a week instead so that your cash flow is taken care of and babysat. And that's the reason why I say it's baby, because it needs to be consistently tweaked and babysat and monitored.
Oop, I think you're muted.
[00:19:18] Speaker A: It was, I'm curious about, you know, on that cash flow side, business loan payouts, getting capital loan investment and working with investors and expectations of performance after that.
I've had kind of a rocky relationship as an employee working with, you know, companies that have gone from, you know, small ownership to being part of a corporate constellation as part of a buyout or, you know, taking on investors. And now suddenly everybody has, you know, these additional criteria that they have to meet.
What's been your experience kind of navigating those waters of stepping, you know, back end financing, if you will.
Do you mean like, like investor situations like private equity or angel investor relationships?
[00:20:27] Speaker B: Yeah, yeah.
[00:20:28] Speaker A: Involved with your company and you know, the decision making of, you know, like you want to grow. Like one company I was with was a SaaS company and they wanted to grow aggressively and so they turned to a private finance company which gave them the money to do so, but also with a contingent strain of expectations for growth and sales. So.
[00:20:52] Speaker B: Right. Yeah. Well, I do have a current client who is building a incredible STI testing company. It's a, it's going to be huge and amazing and I'm so excited for it. But they are, they've been so far reliant on angel investors, pretty much just anybody who wants to contribute money in exchange for shares of the company. But right now she's trying to get a huge, some capital funding from like a firm and it's going to be I think several million dollars at this point. So I haven't, she hasn't secured it yet. But what I mean, what I'm trying to get at here is like there are expectations that come with these certain revenue shares, like if you need to pay out your locations or clients or whatever it is because you are in some sort of agreement and like you want to have their interest at heart. But, and, but you also want to have your own interest at heart. So I think there is a fine line of like walking that like where do My values lie and like how much of my business do I want to lay on the capital investors and how much do I want? How much control do I want to retain? And that's all negotiable in the terms.
[00:22:18] Speaker A: Two questions. One is going down the line of the franchise concept. Have you worked with any individuals that are under a franchise or on top of a franchise offering it to smaller people? Is that something you have experience in that you can chime in about the challenges of being in a constellation where you can control brand, you can't control brand, but you can repeat a quote, successful model or, or is that an area where you haven't touched yet, not
[00:22:51] Speaker B: been a part of any franchises? I do have a client who's trying to sell her company.
That's about as far into like acquisition or like you know, all of that that I have.
[00:23:03] Speaker A: Fair enough.
I, it's probably more of like a personal question.
What do you think about corporations?
[00:23:14] Speaker B: Because what do you mean like legal corporations or like.
[00:23:19] Speaker A: Yeah, so at the end of the day these entities exist and their primary factor is a requirement for growth and profitability.
And you know, from a socioeconomic perspective, you know, that can often lead to decision making that is exclusive of other major factors. You know, if you're a small business, business owner starting out, obviously you know, you want to make money, but you also have those secondary factors of well, I shouldn't do things that are going to destroy my community or take on business practices that are toxic. Is there any, you know, any perspective you have on managing corporate culture or from a financial perspective of you know, creating, you know, of an S corp, A B corp where it has those that social mission listed out in the terms of service, so to speak for the entity as opposed to, hey, the end game is money and whatever happens happens as long as we stay within the boundaries of the law.
[00:24:39] Speaker B: That's interesting because I definitely like in my intake form when you book a, a book a clarity call with me, you have to answer a question about like I choose to work with people who have missions who are incredibly like focused on helping their community, helping their families and like making, even making their own lives better. Like I, I choose to work with mission driven companies and corporations. At that level it's kind of impossible to make decisions that are purely for like the good of the community when you have a board of directors or you have a board of people who are only care about their own, you know, and end profitability. So as far as like S Corp versus B corp versus C corp versus like you know, sole proprietor llc. Like it's all using the system, the tax system to your advantage, which I am fully for. If you can learn how to game the system and use the, the laws to your advantage, like, go for it. Because I think that the more people who are mission driven, who know the laws, who know how to make them work for themselves, will make the world a better place.
[00:26:02] Speaker A: I like that.
So turning to the elephant that's always standing in the room, in every interview I have, at some point I have to ask about AI. And you know, as my friend Matt Brooks at SEOT says it's your least trained but most popular customer support representative. What's your opinion on companies, you know, popping into Claude and ChatGPT and asking those questions that you usually field?
When we know that it often hallucinates raw information lies about some of the results that it may get even when it's observed and challenged.
What's your opinion of the use of AI in the field of finance?
[00:26:54] Speaker B: I use AI every day.
So I am a big proponent of ideating with AI as far as I don't know if you know anything about human design, but I'm a manifesting generator and what that means is like I need something to respond to. So in the way that my energy works is like I usually can't go into a project or go into an idea for something without having any sort of like something to, to grab onto or chew on, you know what I mean? So I usually am responding to something that I've seen online or seen on threads or, or had a conversation about in that way. I ideate a lot with AI about like daily business tasks. I can't even think of anything off the top of my head right now because I use it so just for like every everyday tasks. But as far as in finance like QuickBooks has tried to implement AI into their bookkeeping. I use an AI accounting software called Count who is my practice manager. It's also my bookkeeping software. A lot of my clients are in that software and it is extremely helpful to scan the expenses that are going through the bank trans the bank feeds and catch those things. But you're always going to need a human eye on those things because I would say probably 45% of the time it's wrong.
It's not absolutely taking that work off the off the plate.
[00:28:37] Speaker A: So more aim. Look at it as a cautious assistant, not a replacement.
Correct.
[00:28:45] Speaker B: Yeah, well because, and like you said, like it hallucinates and I think the more you use AI, the better you get at prompting it. And the better you get at knowing, okay, what can I use this for successfully? Instead of like, I think it's more dangerous to use it rarely than not at all or, like, all the time. Does that make sense? Like, if you're not.
Yeah. So if you're not, like, fully versed on how to prompt it, how to lead it to what you're trying to get it to lead you to, it can easily lead you astray. So I think the more you. If you're going to use it, you should use it more. If you're not going to use it, don't use it at all.
It's my thing.
[00:29:32] Speaker A: So don't. Don't hang out in the shallow end. Either jump in or stay out of the water.
[00:29:38] Speaker B: Yeah, exactly.
[00:29:40] Speaker A: Fair enough. I was kind of wrap up here.
What are some things that you've been working on that you want people to know about about your company?
Are you doing any special classes or sessions or putting out information that people could follow up on? I'm happy to add stuff to the show notes if people want to learn more from you.
[00:30:03] Speaker B: Yeah. So I've just launched my industry mastermind for other accounting professionals who want to stand out in the online space.
Marketing positioning authority in the online space. It's really for accounting professionals who are done being boring and done relying on the educational. Here's how to read a P L. Or, you know, this is how to do a journal entry and like, things that anybody can look up on Google anywhere they want to. And like, start actually bringing in those clients who want you for your advisory and making a standout appearance online.
[00:30:46] Speaker A: Absolutely. Love it. Thank you so much, Megan, for coming on. I'll make sure that any of those resources you mentioned are linked like the mastermind. And thank you for your time.
[00:30:55] Speaker B: Thank you so much, Jeremy. This was fun.
