Mike Widdis, Founder and Partner of UpSide Accounting, found himself in construction when his mother, a self-employed bookkeeper, desperately needed help offering great service to businesses. From there, Mike saw the opportunity to build and start an accounting firm from scratch.

This was in 2012, and now Mike merged his firm with another small firm and continues to grow staff and revenues.

In this episode of Growing Your Firm Podcast, David Cristello and Mike Widdis discuss:

1. How Mike found his first clients without any connections
2. Growing your firm through merging firms
3. What Mike sees as the future in the accounting industry

Disclosure: Mike is a customer of Jetpack Workflow. You can setup your own, 14 Day Free Trial (full features) here

ADDITIONAL LINKS:

• UpSide Accounting – Mike Widdis’ firm
• Mike Widdis – Linkedin
• Mike Waddis’ email — mike “@” upsideaccounting.ca
• What a CPA Should Know About a Firm Merger (interview)
• How to Turn Your Networking Into New Accounting Clients (interview)

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How to start an accounting firm from scratch summary

Building An Accounting Firm From Scratch

Mike Widdis broke out of the construction industry to set up an accounting firm starting from his kitchen table. His mother was a successful self-employed bookkeeper for multiple years. Her workload filled up quickly as more and more business owners struggled with their taxes and books year-in and year-out.

A lightbulb turned on in Mike’s head — an opportunity to build his own company. He had read the popular entrepreneurship book, “Rich Dad Poor Dad“. The inspiration that starting a business creates a better life pushed Mike to open UpSide Accounting.

Finding His First Clients:

As with any new entrepreneur, the first question that creeps up: “Where do I get my clients?”
Those first couple of years as a business owner can be stressful. Mike felt the same nervous feelings in his guts as most entrepreneurs, after all, he needed money to pay his personal bills.

Mike took the first steps by joining an entrepreneur network. To better integrate, he also rented an office space to meet the other startups and creatives who also gather there. After plugging away in the group, the owner of the space became one of Mike’s first clients and advocate to other business owners.

The first seeds of his firm sprouted as his first few clients in this entrepreneur network spread the word. Even today, Mike still enjoys working most with startups and creatives as the first stages of a new business are the most exciting.

On top of that, Mike attended regular conferences and events from associations, such as the Professional Bookkeeping Association.

“It’s all about the people you meet and opportunities will come your way.”

– Mike Widdis

Through networking and conferences, Mike built an influence circle where referrals develop. At a conference, he actually met one of his team members who works with UpSide as a full-time employee.

Merging With Another Firm In Order To Grow:

At a networking event, Mike bumped into Phil McTaggart. Phil, like Mike, trotted out on his own after working in various financial roles. He had started it as a side-job, and in 2015, went full-time. He was looking for clients as was Mike.

After many great discussions, Mike had another lightbulb moment. Why not merge the two firms and create a large firm?

Mike’s firm didn’t dwarf Phil’s firm as they were similar sizes. To keep everything simple and amicable, they both agreed to a 50/50 split.

Right away, Mike’s firm doubled. They decided to keep Mike’s brand, UpSide Accounting, and the firm continued to grow in its fourth year. As the firm boosted their client size, the looming need for employees crept in.

Mike, as stated, then met a current employee at a conference. It all started with a random sit-down at a table and a conversation. A major problem with any new hire comes from the catch-22:

• Hire slow when you don’t have the cash or clients
• Wait until you have clients but need to hire fast

Mike already felt the sting of losing a team member to a larger firm due to compensation reasons. But, he understands that he learns from these experiences.
The other side of the coin is uncovering the right candidates. Networking and conferences proved helpful for Mike. What might work for your firm?

DAVID’S TIP: Ask everyone you know “Who do you know?” Even ask in the unlikeliest places, people such as your Quickbooks Intuit rep — “Who do you know?” You never know where your next great employee may come from.

Mike and Phil meet each month to go over various client and firm questions. These partner meetings are a critical foundation piece for these hiring decisions and growth strategies.

Future of Accounting Firms:

As technology continues to grow, many firm owners might not think any changes will come. Mike believes differently.

Data entry and coding will definitely get automated by robots, Mike says, but there will always be a need for someone to monitor and advise the financial side.

Robots cannot take that away.

Many startup business owners and creatives will not want to do this, so Mike thinks his firm will always have a great core client base — his ideal clients!

If you had to start all over, how would you build or start your accounting firm from scratch?

Disclosure: Mike is a customer of Jetpack Workflow. You can setup your own, 14 Day Free Trial (full features) here

Related Articles:

1. The Accounting Firm’s Blueprint to Creating A World-Class Team (Without Recruiting)
2. Automate Your Accounting Firm to 1500% Growth with Heather Pranitis
3. Create A Tech Ecosystem And Implement New Accounting Applications

Richard Clayman, Founder of Cloudwalker Videoworks, found using video is the fastest way to get a prospect to trust you and get your messaging right.
Building a career in the movie industry, Richard discovered a simple, but effective way to stand out from the competition.

In this episode of Growing Your Firm Podcast, David Cristello and Richard Clayman dig into:

• What a prospect is actually thinking when they first find your business
• The fastest way to get a prospect to trust you and want to work with you
• Ideas to make your accounting firm different than the one down the street

ADDITIONAL INFORMATION:

• Linkedin – Richard Clayman
• Cloudwalker Videoworks – Richard Clayman’s company
• Richard’s email address
• The firm that swears around the office…

Building a unique company:

Richard Clayman, Founder at Cloudwalker Videoworks, specializes in helping accounting firms and other companies get their messaging right through compelling corporate videos.

He started off with doing Los Angeles Rams games (before they moved to St. Louis) when he was just 21. Immediately, he was struck by the power of production and video.

Still in his mid-20s, he became head of production for a company and got to work with all the top networks. He oversaw classic shows such as: “All in the Family,” “The Jeffersons,” “Facts of Life,” and many more. As the years progressed, he produced for a variety of companies and wrote scripts for theater and film.

On the side, he ran acting workshops and did acting himself. One rehearsal, he played a lawyer, a role he felt confident he nailed. As he strutted onstage, the director stopped the rehearsal and told Richard essentially, “Your non-verbal communication isn’t projecting your character correctly.”

He couldn’t just “be a lawyer.” He needed to be an individual who happened to be a lawyer.

The light bulb flickered and Richard formed the idea to create a video production company for corporate professionals.

What a prospect first thinks when they hit your firm’s site:

The idea for Cloudwalker Videoworks was important because you, as an individual, must garner trust before you can become a professional to the prospect.

“We are all in the attention business” — Richard Clayman

Richard worked in movies which is all about attention (hence, the crazy, thrilling trailers). Although not coming from a suit and tie corporate-type environment, Richard knew he was better than others at creating interesting videos.

Coupled with his script-writing abilities, he could grab attention with videos he creates for businesses.

A client first hits your site because you grabbed their attention, the next step is to build trust. When a prospect first encounters your business, they aren’t thinking about

“What services do you have?” That comes second.

First, they think “Can I trust this company to help me in the best way possible?” The WHO is more important than the WHAT.

“Are they tough enough to tell me the good and bad? Are they human enough for me?”

That’s why they say “first impressions are everything.” You must project trust. But, that’s only one piece of it.

To build trust, you must be an individual, and that’s the fastest way to starting a conversation.

The fastest way to build trust:

Clients don’t want to work with the smartest people, necessarily. They would rather work with someone who they feel is a trustworthy HUMAN. When a prospect evaluates an accounting firm, they will most likely sign with the firm who has the staff the client best gets along with and relates.

This is why Richard created his company. He found too many accounting and firm professionals who wished to just project a “professional” image. Well, everyone projects themselves, most of the time, as a “professional.”

If you want to build trust, you need to differentiate yourself from the preconceived notion already going on in a prospect’s mind. A prospect expects an accountant to be a dry, numbers driven, person. They expect a lawyer to be fast-talking and opinionated. A car salesmen to be pushy and not a good listener.

When you present yourself as a human, an individual with your own likes and dislikes, a prospect will be attracted to you.

It all boils down to self-awareness. “How does a client see you?” Are you merely an accountant? Or, do you have other pieces to you?

Example:

Richard had a lawyer client. Most lawyer videos talk about “closing the case, getting it done, etc.” Those are standard, but the client needed to differentiate himself.

The lawyer projected a “normal lawyer” — clean cut, very intelligent — but, to differentiate himself, the video starts with him talking about gardening with his daughter in his spare time.

Suddenly, he isn’t in the “standard lawyer” pile anymore. He’s the intelligent lawyer who loves gardening with his daughter. He’s now become a real human.

Being a professional remains important, just add more to yourself on top of that.

Ideas to make your accounting firm different

We talked already about how you can’t just act the stereotype of your profession. You need to be different.

Clients need to feel comfortable with you to open up their personal life and struggles (including their finances), when you come across as more human and a “suit,” it changes the dynamic of the relationship.

Start with making your office your own personal “portrait” of your life. Put up things you like to do, pictures of your favorite movies, sports teams, etc. This makes the client more comfortable. Also, it makes the accountant feel more at home while at work.

On top of that, make sure you understand the lives of your clients. Answer the “unarticulated questions” they have in their mind. For example, when you walk on a car lot, you’re thinking to yourself “I want to walk off this lot with a car under budget, but I really want.” Every question you then ask is around this thought process. If a car salesmen addresses these two pieces to you, you feel more comfortable.

Assess who you are and what is true for you and reinforce that over and over. Look at the counter-balance — how are you different than the accounting professional down the street? You do the same tasks, sure, you do them better, but that’s not what the client wants as much as someone they trust and see as an individual.

How are you different and portray that to your clients?

Related Articles:

1. How To Make The Switch From Employee To CPA Firm Owner
2. The Core Elements of an Accounting Client Lifecycle
3. What is the Trusted Business Adviser Mindset for Accounting Firms

Greg and Jessica Daley built their accounting firm, Xcelerate Business Solutions, while they needed to scrap together $10,000 to adopt a new child. Their revolutionary use of contractors under “results-based compensation” will change how firms pay their workers.

Their practice has been called a “Firm of the Future” by Intuit.

They’ve found a unique way and win-win for contractors and firm owners to build a better, healthier, faster-growing firm where everyone is motivated.

In this episode of Grow Your Firm Podcast, David Cristello and Greg and Jessica Daley discuss:

• The way results-based compensation works
• How to make contractors and employees highly motivated to grow the firm
• Building a virtual team and helping them mesh even when they’re all over the world

ADDITIONAL LINKS:

• Xcelerate Business Solutions – Greg and Jessica’s practice
• The Go-Giver  — Book
• Making Money is Killing Your Business  — Book
• Firm of the Future
• Email addresses for both (they offer you to reach out and ask them any questions):
  • jessica@xcelerate-solutions.com
  • greg@xcelerate-solutions.com

Building a practice out of a need:

Greg and Jessica Daley worked regular jobs and had a beautiful 6-year old to round off a great family. They decided it was time to expand their family and sought to adopt.

The problem?

It cost $10,000…Money that wasn’t easy to come by back in 2011.

Jessica was an employed accountant at the time and decided, like any “kitchen table entrepreneur,” to start an accounting firm from her house. It was how they were going to hit their $10,000 goal.

At first, she ran a simple, hourly-based bookkeeping practice, and quickly hit their $10,000 goal. They kept going.

As a full-time, employed accountant, she had to travel to various clients and it cost her time and efficiency. She wanted to be there for her 6-year old and newly adopted one.

When she opened up her practice, her sole focus was building a business around her, a “Full-time Mom.”

Her first clients was her church. There, she received referrals and got leads through the ProAdvisor site at Intuit.

In 2011, they had 2 large clients. By 2012 + 2013, they had bolstered their roster to around 12 clients. Today, they continue to multiply each quarter thanks to their team and the focus on “efficiency.”

Unique hiring that worked:

As Greg and Jessica mulled over how they could expand without having to get an office like a normal, same-old firm, they thought about the reason they built the firm again — help their family.

The light bulb flickered and they decided to work with a virtual team comprised of other “Stay-at-home Moms who need the flexibility of time but able to put in the work.” Great contractors not bound by a rigid schedule, because of their scrambled schedules.

They hired two ladies after a couple years, and the practice grew.

At this point, Greg and Jessica came to the conclusion:

If we keep doing hourly pricing, our payroll is all over the place, plus, in order to grow, we would need to hire more and more.

To combat this, they started with value-based billing for clients. This allowed them to have predictable revenue. “We had to be willing to lose clients…” in order to be more efficient in the practice. Efficiency was the key.

They held onto all their clients even with the radical shift. Now, they needed to reign in on the erratic payroll. With hourly compensation, it posed two problems:

• They couldn’t budget compensation as it could go up and down depending on the time of year.
• The workers, as they became more efficient, would get paid less and probably quit. They would have the temptation to “take their time,” with the work in order to increase their billable hours.

That’s when “Results-based compensation” was born.

How it works:

The clients pay a flat-fee per month (based on value billing), and each “Accounting Specialist” [(as the bookkeepers are known internally) get a piece of that fee based on their work.

As the Accounting Specialists got more efficient and found better apps, they could dramatically boost their hourly rates.

It works like this:

• Greg and Jessica determine “The client work should take X amount of time/effort. We are charging the client $X per month. With the time allocation, the Accounting Specialist gets XX% of that revenue per month.”
• The Accounting Specialist keeps their time in TSheets not for billing but to make sure Greg and Jessica estimated the workload correctly. They are happy to adjust if there’s a major discrepancy and compensate the Specialist more if the bid was way under.
• As the Specialist gets more efficiency, they can open up their capacity to take on more clients and thus getting more work.

Example:

If Xcelerate charges Client ABC $1000 per month for work. Xcelerate estimates it will take a Specialist 20 hours per month. Xcelerate calculates at $15 per hour, the Specialist will get compensated $300 for their work.

If the Specialist gets more efficient and does the work in 10 hours, they will still get $300. The 10 hours they saved can then be invested in a new client where they can make another $300 on a client, and so on.

Why Results-Based Compensation works:

For many, this might sound like a hybrid hourly and salary based compensation, and they could be right. It takes out the worst in both.
Hourly — If you get more efficient, you lose money because it takes less time.
Salary — As you take on more work, you don’t get paid anymore.

Results-based compensation solves this. In addition, Greg and Jessica added a “profit-sharing” element to the picture. As Specialists get better, they can take advantage of the profits they create and see bonuses. Even though they are contractors, Greg and Jessica see them as “stakeholders.”

As the Specialists gain more efficiency and make more money, they are motivated to continue to get better. With salaried work, “you get paid regardless of how you did that month.” With Results-based compensation, if you start slacking off, your pay drops.

It keeps workers motivated to grow, learn and help the firm.

Better virtual teams:

As all their contractors work remote, it can get tough to build a cohesive group. Working virtual is becoming more and more common and accepted, but the growing pains still exist.

Greg and Jessica set up monthly calls with all the Specialists. It’s not for a “meeting” but pure discussion. New topics, problems, points of interest, ideas, and more are all available to tackle.

They’ve instituted “Accounting Specialist Leads” to peel off some of the review work and compliance from Greg and Jessica and put on other Specialists. This allows them to interact and learn together plus solve issues. This build a closer team.

Greg and Jessica want to help YOU:

Greg and Jessica built their firm learning from other owners who spent years building their practice. It wasn’t easy and some firm owners even shut the door in their faces when they simply asked for some advice.

They live their motto in the business “Helping Families Thrive,” and they do this by giving their time to firm owners like you and giving their time and money (when they pay-out profit sharing percentages, they match the percentages given and donate that piece to charity).

They are happy to talk to you and give you help as you grow your practice. Greg and Jessica believe your business should center on creating a better life for you. To do that, you need to work ON your business and not IN your business.

They received these tips and much more from one book…”Making Money is Killing Your Business” by Chuck Blakeman.

Will you try results-based compensation in your firm? Let us know in the comments.

Related Articles:

1. How to Start an Accounting Firm From Scratch
2. How can I communicate the ‘advisor’ to my accounting clients?
3. The Core Elements of an Accounting Client Lifecycle