Should Fractional CFOs Offer Bookkeeping? (The answer!)

Summary

In this insightful discussion, the host and Matt Tate, CEO of Desmal, explore the dynamics between fractional CFOs and bookkeeping. They delve into the importance of focusing on core competencies rather than diversifying services, which can dilute a company's value. Tate emphasizes the distinction between high-level advisory work and operational tasks like bookkeeping, advocating for deep expertise in specific areas. The conversation uncovers hard-learned lessons in business, effective communication, and the strategic approach to scaling a business while maintaining a strong client relationship.

Takeaways

• 📊 Specialization is crucial for professional service businesses; Matt Tate emphasizes the importance of focusing on core competencies to maintain efficacy and value.
• 🔍 Matt discusses the dilution of value when businesses expand beyond their core services, advocating for going deep into a specific skill set rather than spreading thin.
• 🛠 The conversation highlights the different management skills required for high-level strategic thinking versus day-to-day bookkeeping operations.
• 🤝 The importance of partnership between fractional CFOs and bookkeepers is underscored, with a focus on open communication and mutual respect for each party's expertise.
• 🚀 Matt shares insights on scaling a business, stressing the need for systemization, process creation, and team empowerment to handle growth effectively.
• 🔄 The transcript reveals the challenges of maintaining a strong company culture in a remote or hybrid work environment and the deliberate steps taken to foster a cohesive team.
• 🤔 Matt admits his impatience as a challenge in business, reflecting on the difficulties of change and the time it takes to implement effective processes within a company.
• 🔑 The concept of 'bad revenue' is introduced, referring to income that doesn't align with the business's highest value offerings, which can detract from overall success.
• 💡 The interviewee shares personal experiences, such as being an engineer and a leader, to illustrate the importance of aligning leadership style with team needs and processes.
• 🗓️ The necessity of setting clear scope of work and maintaining strict adherence to it is discussed, to prevent scope creep and ensure efficient service delivery.
• 💼 The transcript touches on the role of a CEO in sales, stating that initial sales should be led by the CEO to establish a solid foundation before delegating to a sales team.

Q & A

What is the main topic of discussion in the conversation between the host and Matt Tate?

The main topic of discussion is the role of fractional CFOs in offering bookkeeping services and the importance of focusing on core competencies within a professional services company.

Why does Matt Tate believe that fractional CFOs should not offer bookkeeping services?

Matt Tate believes that fractional CFOs should not offer bookkeeping services because it dilutes their efficacy and value, as bookkeeping requires different skill sets and management styles than high-level advisory work.

What does Matt Tate suggest as an alternative to offering multiple services that may not be a company's core competency?

Matt Tate suggests going vertical by finding a specific skill set or vertical niche in which the company is uniquely good at and focusing deeply on that to provide maximum value.

What is Matt Tate's view on the concept of 'bad revenue' in a business context?

Matt Tate views 'bad revenue' as revenue generated from services that do not align with the company's highest best use or core competency, which can lead to inefficiencies and reduced value for clients.

How does Matt Tate define the difference between managing a team of fractional CFOs and a team of bookkeepers?

Matt Tate defines the difference as managing a team of high-level thinkers versus managing a team of process people, where each team requires different management mechanics and skill sets.

What is Matt Tate's perspective on the joy and satisfaction that finance professionals derive from their work?

Matt Tate believes that many finance professionals do not find joy in the nitty-gritty of bookkeeping and backward-looking accounting, which can affect their performance and the quality of service they provide.

How does Matt Tate approach the issue of scalability in his bookkeeping firm, Deasil?

Matt Tate focuses on creating scalable processes and policies that allow the firm to maintain high-quality service as it scales, rather than scaling individual people's brainpower.

What does Matt Tate consider essential for creating exceptional and scalable services in a business?

Matt Tate believes that to create exceptional and scalable services, a business must have a team that loves doing the work and finds joy in it, and leaders who are deeply involved in the processes to ensure quality and remove the hard parts.

How does Matt Tate view the importance of systemization and process in providing consistent quality in services?

Matt Tate views systemization and process as crucial for ensuring consistent quality in services, allowing the business to scale effectively while maintaining a high standard of output.

What is Matt Tate's philosophy on the depth of processes in a business?

Matt Tate's philosophy lies in the middle of the spectrum, advocating for simplicity in processes while ensuring they are detailed enough to consistently produce quality output, following the KISS principle (Keep It Simple, Stupid).

How does Matt Tate address the issue of responsiveness in client communications within his company?

Matt Tate addresses responsiveness by setting a standard of under two-hour response time and under 24-hour handle time, using a shared inbox system to track and manage response times, and fostering a culture of respect and acknowledgment.

What is the key takeaway from Matt Tate's discussion on the importance of partnerships between fractional CFOs and bookkeepers?

The key takeaway is that partnerships should be based on mutual respect, open communication, and a shared goal of improving the client's experience, rather than a hierarchical relationship where one party is seen as superior.

What challenges does Matt Tate face as the CEO of a rapidly growing company?

Matt Tate faces the challenge of managing his own impatience and the desire for quick change, as well as the need to ensure that his leadership team effectively filters and manages his feedback and ideas.

How does Matt Tate handle the issue of scope creep in his business?

Matt Tate handles scope creep by being intentional about breaking the scope slightly when it strategically benefits the relationship or the client, while also maintaining strict adherence to the defined scope of work.

What advice does Matt Tate give to CEOs who struggle with the idea of being a salesperson?

Matt Tate advises CEOs to embrace the role of a salesperson, practice their sales pitch, learn from doing, and be curious about improving their sales skills, as sales is an essential part of running a business.

How does Matt Tate view the role of a CEO in the sales process of a growing business?

Matt Tate believes that the CEO should personally be involved in the sales process, especially in the early stages, to understand the client's needs and create a playbook that can be used to train others.

Outlines

00:00

🤔 The Debate on Fractional CFOs Offering Bookkeeping

In this paragraph, the speaker introduces a discussion with Matt Tate, CEO of Desmal, about whether fractional CFOs should offer bookkeeping services. The conversation centers on the importance of focusing on core competencies and the potential dilution of value when a professional service company strays from its area of expertise. Matt argues that businesses should 'go vertical' and specialize deeply in a specific skill set, rather than offering a broad suite of services. He emphasizes the different skill sets required for high-level advisory work versus the operational tasks of bookkeeping, suggesting that attempting to do both can lead to inefficiencies and a loss of client trust.

05:01

🔍 The Importance of Specialization and Process in Business Growth

This paragraph delves deeper into the conversation about specialization and process. Matt Tate discusses the challenges of scaling a business when offering both high-level CFO services and bookkeeping. He highlights the need for creating scalable processes and having a team that enjoys their work, which is crucial for maintaining quality. The discussion touches on the difference between designing processes for competent professionals versus those that require step-by-step guidance. Matt shares his philosophy on balancing simplicity in processes with achieving consistent, quality output, emphasizing the importance of not overcomplicating procedures.

10:01

📈 Scaling Processes and the Obsession with Responsiveness

In this segment, the focus shifts to the importance of responsiveness in client communication as a key differentiator for Desmal. Matt Tate shares his personal mission to show respect through timely responses and discusses the challenges of maintaining responsiveness as a company scales. He explains how Desmal uses a shared inbox system and response time tracking to ensure high standards of client communication. The paragraph also touches on the importance of systemization and the use of technology to manage and improve service quality, while also maintaining a human touch in client relationships.

15:03

🌐 Building a Deliberate Culture in a Remote Work Environment

The conversation moves to the topic of building a company culture in a remote work setting. Matt Tate describes the intentional approach Desmal takes to foster a sense of gratitude and connection among its employees, who are spread across multiple countries and states. He discusses the importance of creating shared values, meaningful interactions, and a supportive environment. Matt also shares how Desmal handles the challenges of communication and relationship-building in a virtual environment, emphasizing the need for deliberate actions to maintain a strong company culture.

20:05

🤝 The Crucial Role of Partnership Between Bookkeepers and Fractional CFOs

This paragraph explores the relationship dynamics between bookkeepers and fractional CFOs. Matt Tate stresses the importance of a true partnership, where both parties collaborate to improve the client's experience. He criticizes the arrogance sometimes displayed by those in higher positions and emphasizes the need for mutual respect and communication. The discussion highlights the benefits of clear communication and setting expectations, as well as the negative impact of siloed operations on client satisfaction.

25:07

🚀 Embracing the Role of a Beginner and the Challenges of Scaling

Matt Tate reflects on the challenges of scaling a business and the importance of embracing the role of a beginner as new stages of growth are reached. He discusses the need for continuous learning and adaptability, acknowledging that impatience can be a hindrance. The conversation touches on the importance of being humble, admitting mistakes, and learning from them. Matt also shares his personal journey of self-discovery and the realization that success in business and life requires a willingness to start anew and learn at each stage.

30:08

📚 The Art of Sales and the CEO's Role in Revenue Generation

In this segment, the focus is on sales and the CEO's role in generating revenue. Matt Tate shares his passion for sales as a process of building relationships and trust. He emphasizes the importance of authenticity in sales interactions and the need for CEOs to be involved in the sales process, especially in the early stages of a business. The discussion includes advice on practicing sales pitches and learning from real interactions, highlighting the necessity of CEOs to understand and participate in sales to effectively train others.

35:09

💼 The CEO's Journey from Salesperson to Leader

The final paragraph wraps up the conversation with insights on the CEO's evolving role from being a hands-on salesperson to a leader who must delegate sales responsibilities. Matt Tate discusses the transition point where CEOs can begin to hand off sales tasks to others, emphasizing the importance of having a solid understanding of the sales process before doing so. He also touches on the misconceptions some CEOs have about their role in sales and the need for a practical approach to learning and implementing sales strategies.

Keywords

💡Fractional CFO

A Fractional CFO is a part-time Chief Financial Officer who provides financial management and strategic advice to businesses, often startups or small to medium-sized enterprises, that cannot afford a full-time CFO. In the video, the discussion revolves around the role of a Fractional CFO and whether they should also offer bookkeeping services, highlighting the importance of focusing on core competencies.

💡Bookkeeping

Bookkeeping refers to the process of recording and maintaining financial transactions of a business. It is a foundational aspect of financial management. The video script discusses the relationship between bookkeeping and the role of a Fractional CFO, emphasizing that while some Fractional CFOs may offer bookkeeping, it may dilute their core value if it's not their area of expertise.

💡Core Competency

Core competency is the unique ability or skill that a person or company possesses, which gives them an advantage over others in their field. In the context of the video, Matt Tate argues that businesses, including Fractional CFOs, should focus on their core competencies to maintain their efficacy and value, rather than diversifying into areas they are not uniquely good at.

💡Professional Services

Professional services encompass any service provided by individuals with specialized knowledge or skills, such as legal, accounting, or advisory services. The video discusses the importance of maintaining high standards in professional services and the potential pitfalls of offering services outside one's area of expertise, such as a Fractional CFO offering bookkeeping.

💡Strategic Planning

Strategic planning is the process of defining an organization's long-term goals and the actions needed to achieve them. The script mentions that a Fractional CFO is involved in high-level advisory work, which includes strategic planning and thinking about a client's future needs, as opposed to focusing on day-to-day bookkeeping.

💡Financial Operations

Financial operations involve the management of a company's financial resources, including budgeting, forecasting, and ensuring the accuracy of financial records. The video script uses the term to describe the specialized area where a bookkeeping firm like Desmal excels, as opposed to the strategic advisory role of a Fractional CFO.

💡Process Management

Process management refers to the coordination and supervision of the processes within an organization to ensure they are efficient and effective. The script discusses the difference in skill sets required for managing a team of high-level thinkers versus a team of process-oriented bookkeepers, highlighting the importance of aligning management style with team function.

💡Partnership

Partnership in a business context refers to a collaborative relationship between two or more parties working towards a common goal. The video emphasizes the importance of establishing strong partnerships between Fractional CFOs and bookkeepers, where both parties understand their roles and work together to deliver the best outcomes for clients.

💡Scope of Work

Scope of work defines the tasks, deliverables, and boundaries within which a service provider operates. The script discusses the importance of clearly defining and adhering to the scope of work for both bookkeepers and Fractional CFOs to avoid confusion, frustration, and to ensure that clients' needs are met efficiently.

💡Systemization

Systemization is the process of creating systems and processes to make a business function more efficiently and effectively. The video script highlights Matt Tate's emphasis on systemization and process creation as a key to providing exceptional services at scale, allowing a bookkeeping firm to manage a large number of clients successfully.

💡Responsiveness

Responsiveness refers to the quick and appropriate reaction to client inquiries or issues. The video discusses the importance of being responsive as a key aspect of building strong client relationships and providing exceptional service, with the speaker sharing his approach to ensuring high levels of responsiveness within his firm.

💡Remote Work

Remote work is the practice of working from a location outside the traditional office, such as from home or any other place with internet access. The script touches on the challenges and strategies of building a cohesive company culture when the team is spread across different locations, emphasizing the need for intentional efforts to create a sense of community and shared values.

💡Sales

Sales is the process of persuading someone to buy a product or service. The video script discusses the importance of sales skills for CEOs and entrepreneurs, emphasizing that selling is not just about transactions but about building relationships and trust with clients, team members, and other stakeholders.

Highlights

The importance of core competency in professional services and the risks of diluting service value by straying from it.

The unique challenges and skill sets required for managing high-level thinkers versus process-oriented bookkeepers.

The concept of 'bad revenue' and its impact on a company's highest best use of resources.

The joy and satisfaction derived from focusing on specific tasks versus the frustration of managing non-core activities.

The necessity for fractional CFOs to consider the strategic implications of offering bookkeeping services.

The value of systemization and process in delivering scalable and exceptional services.

The philosophy of keeping processes simple yet effective for consistent quality output.

The importance of team members finding joy in their work and the role of process in achieving that.

The role of technology as a tool for enhancing relationships rather than replacing human interaction.

The significance of responsiveness in client communications and its impact on building strong client relationships.

The use of technology and systems to monitor and improve communication response times.

The challenges of maintaining a cohesive team culture in a remote or hybrid work environment.

The importance of intentionality in all aspects of building a remote team culture.

The benefits of a partnership approach between fractional CFOs and bookkeepers for client success.

The need for clear communication and understanding of scope of work between different service providers.

The potential downsides of arrogance and lack of respect in professional service relationships.

The personal growth and self-awareness required for successful leadership and business management.

The reality of embracing the role of a beginner in various stages of business and life.

The power of curiosity in overcoming the challenges of new roles and learning opportunities.

The critical role of sales in business and the necessity for CEOs to engage in sales activities.

The importance of practicing sales skills and learning from experience to improve sales effectiveness.

The misconceptions around delegating sales too early in a company's lifecycle and the risks it poses.

The significance of operationalizing and systematizing bookkeeping processes for efficiency.

Transcripts

should fractional CFOs ever offer

bookkeeping that's the big question that

I'm addressing today with my friend Matt

Tate Matt is the CEO of desmal desol is

a bookkeeping firm that started just

four years ago and they've already

scaled up to over 650 clients we're

going to dive into the relationship that

has to exist between a bookkeeper and a

fractional CFO and we're going to have

some candid conversations about just

hard Lessons Learned in business and how

to solve problems as a CEO without

further Ado here's my conversation with

Matt Tate

Matt I want to start off with a very

very direct question a lot of fractional

CFOs offer the full Suite they're doing

advisory they're also doing bookkeeping

they're also doing taxes they're doing

all the compliance things is that a

mistake 100% of the time tell me more

yeah to me when you're doing a

professional service and building a

Professional Services Company you have

what I like to talk about as a core

competency something that you are

uniquely good when you start doing

things that you're not uniquely good at

that aren't your core competency you

start to dilute your efficacy and your

value and so you start doing things that

a you aren't good at which also tells

your client that hey you're not really

good at this you're also not good at

managing it and these are all different

skill sets some people have a good sales

brain they're really good at bringing in

clients some people have a great

advisory brain other people have a good

tax brain very few people have the

ability to have truly more than one core

competency and so as a business when you

start doing everything you dilute the

value of all of it and so to me it's one

of the things that I've heard you talk a

lot about on your podcasts and in your

content which is go vertical find a good

vertical and dive in and be specific

about it to me what's equally as

important there is find a skill set for

which you are uniquely good at and go

deep into that the more you start going

deep into other things the more you

start to generate what I like to tell my

team is bad revenue revenue that doesn't

have the value of what your highest best

use is or your team's highest best use

so let's dive specifically into your

question CFOs that start to think about

doing bookkeeping or tax when you are

doing CFO work that is highlevel

advisory stuff that is truly highlevel

thought you are diving in with a client

you are thinking about their strategic

needs and planning forward when you

start to look at the bookkeeping side

which is what decimal is uniquely good

at is what i' like to call the financial

operations and bookkeeping when you

start to do that type of stuff you start

to spend your time managing people and

processes that are beneath that high

level thought and you also start to

spend time managing people that are

doing that and it's a different skill

set of management you build out a team

of fractional CFOs you're managing a

team of highlevel thinkers you manage a

team of bookkeepers you're managing a

bunch of process people it's not good or

bad it's not a judgment on either I love

process people but they're different

people and they require different

mechanics and different skill sets and

so you end up stealing from something

that's good to try to apply it to

something that you're maybe okay at the

other part of it too is I mean you and

I've talked about this when we grow our

businesses there are things that we find

joy out of and things that we don't I

always joke that businesses hate

bookkeeping Finance HR it when it comes

to most Finance professionals and

accounting professionals what they truly

dislike is well is thinking about gosh I

got to clean those books up I got to

help them pay their bills I got to do

the cash the bank wrecks I got to you

know all of the nitty-gritty of the

looking backwards accounting doesn't

give you Joy and make you happy and so

not only are you not good at it your

clients know you're not good at it

because you've told them you're there

for this and oh I can throw this in or

I've heard accounting firm say like it's

my lost leader well guess what as a

business owner I got to make sure I'm

paying my bills I'm getting paid and I'm

tracking it all if nothing less than to

stay in business and keep the IRS off my

and you're telling me that's where

you're losing money which means I as a

business owner know you're not valuing

that so to me it's a combination of it's

a bad business decision it's also a bad

kind of quality decision and it's a bad

quality of life decision does that

answer your question it does one thing

that you said in there that really hit

home with me that I hadn't even thought

about before Matt is I used to be an

engineer back in the day and I learned

Not only was I a bad engineer I was also

a bad leader of engineering

I tend to be more of the strategy guy

the 30,000 foot view guy the highlevel

guy and just like you said with

bookkeepers Engineers are process people

and one of the things that I learned I

value process I have process in my

business I'm not a good manager of

processed people because I tend to be

way up in the clouds and what I learned

as an engineering manager is that I

wasn't leading well because those

processed people need a leader that will

get into the weeds around the process

for them and when I wouldn't do that

they felt unseen and un hurt and so I

realized like I'm not the right person

to lead process people because my eyes

gloss over I get bored when I get into

the details and I think there's a direct

correlation there it's like if you're

gonna offer the bookkeeping services and

have bookkeepers you need to be somebody

that's passionate about process and get

into the weeds with your team and if for

no other reason so that they feel seen

and heard and valued or you're going to

be frustrated and they're going to be

frustrated oh I think 100% by the way I

totally empathize with the not being a

good engineer or engineering manager

because I like to joke that I'm a

recovering attorney first so I've I've

been there in that total career

trajectory as well but I think you've

hit the nail on the head which is I love

process I love designing out processes

that help small businesses what I love

even more than that is designing out a

very scalable process that allows our

company to service thousands of other

companies which is also a problem that

you run into when you think about do I

do CFO services and do I do the

bookkeeping or tax scale becomes a

problem when you're talking about

highlevel services and and you kind of

hit this which is you scale people when

you're doing CFO Services you are

scaling people and you are scaling that

brain power for that high level thought

for me when I scale process when I scale

bookkeeping and financial operations a

massive component of that is people but

what makes it scalable and the quality

consistently great is creating umbrella

policies and processes that allow that

to continue with not just one or two or

10 but a thousand or more Matt one of

the things that really stuck out from me

from our time together in Indianapolis a

few weeks ago is that you have a very

clear I would go so far as to say

obsession with

systemization and processing everything

out why is that where does that come

from everybody deserves an exceptional

experience period and to me the only way

to do that while scaling is to create

scalable processes and to look at it in

very minute detail the other part of

that too is in order to create truly

scalable exceptional Services you have

to have a team that loves doing it you

have to have a team that finds joy in

what they get to accomplish and so

creating truly scalable processes and

truly getting into the details lets me

give them joy in what they're doing and

take away the hard Parts take away the

parts they don't want to do and put

those into a more scalable machine to me

technology is great as a tool for making

relationships better it's not an end all

for doing it what is your philosophy on

depth of process I've kind of seen two

schools of thought on this Matt and i'

I'd really love to hear where you land

on it one school of thought is hey look

you know we should go into this with

this expectation that we've got

competent professionals and so our

processes are more like bullet points or

a checklist that a competent

professional could sit down and execute

against to do it the decimal way the

other school of thought on like the

other end of the spectrum is like no no

we're we're in there with like

screenshots and it's a stepbystep kind

of thing and when you take that approach

processes tend to be much more robust

but by virtue of that they're you know

10 20 30 times long so where do you land

and why on that on that Spectrum at I

would say right in the middle of them

which is ironic I don't think I fall

into either camp and and here's here's

what I mean by that I think if you want

to tell me to go bake a cake I am

incapable of doing it without following

very specific instructions I have a

sister-in-law who give her a couple of

ingredients and she comes out with

something fantastic what I find is is

that most people can do what I do which

is follow directions and Achieve success

very few people people can truly do what

she does which is take a couple of

ingredients and come up with something

amazing so when I look at processes to

me I start with the kiss principle keep

it simple and when you keep it simple

but make sure that you're taking care of

the end output the goal is the output so

how do we get consistently quality

output in achievement that could be

quality books and financial reporting

that could be quality bill pay quality

invoicing whatever you look at you build

backwards from there what is the

simplest most effective process for

consistent output over the years we've

had great members of our team what I

find is that people fall into two

categories when they have an accounting

background they are great accountants or

they're great process people and I very

rarely find people that have both and so

I love to give the great accountants a

very clear simple process to follow

business owners I'll go back to this

like you get to be at a super cool place

for business owners because you're

driving their strategy forward and

you're helping them make moreone money

I'm literally doing the stuff that they

hate doing but they know they have to if

I'm going to get them to do that I have

to make it super easy and if I'm going

to get them to change it I have to show

them why it's going to either save them

time or money and hopefully both so to

me it's it's really that combination and

I find anytime people swing the pendulum

and I would say in life in general the

ends tend to be wrong the middle has a

tendency to be the most correct I think

I I totally split the difference here

and that's like a politician's answer

but I think it's truly the right one

you're a lawyer that's what I expected

recovering recovering lawyer one of the

things that really impresses me about

decimal and it stands out far different

from I would go so far as to say any

other bookkeeping or accounting firm

that I've ever gotten into the weeds

with is your Relentless Obsession to

monitoring client Communications in

response times I've found that that's

probably the number one gripe that most

people have with their their bookkeeper

or their accountants it's like I can't

get them to answer me back but you guys

have gone hard the other direction why

is that Obsession part of your company's

DNA how do you do it and what do you see

is kind of the outcome of that so why I

think is a couple of different things

one it is a personal mission of mine to

show people Respect by being responsive

and having grown up in a law firm and

then working my way through technology

companies and and then working my way

through accounting what I find is what

you said which is generally in

Professional Services people are not

nearly as responsive as they should be

and I don't know how you define correct

levels of responsiveness but at the very

least it's acknowledge I exist and

acknowledge when you think that you're

going to have what I need those are two

things that I think are essential to

creating a great relationship but as

much as I hear Professional Services

firms accounting Consulting Law whatever

talk about and train people on it they

never actually do it or they do it for a

day or a week and then it falls off and

part of it's not their fault they get

busy they are the output that is Created

from this but you forget that the

relationship exists uh there was a great

book that my business coach gave me that

was it's about Professional Services

firms and he told me he goes you're

going to hate 80% of this book and 20%

is gold and he was right it was way too

in the weeds for me on running a

Professional Services firm and billable

hours and stuff like that but one of the

things that it it really talked about

was that as a Professional Services firm

or or a professional services provider

most people forget that the output that

they generate is only a small portion of

the value that their client will realize

from the relationship so if I'm a

bookkeeper doing the bookkeeping is only

a small portion of the value my client

is going to derive from the whole

engagement that's tough to think about

when your entire life is about putting

that output out there and so to me

creating a system that allows for that

to be better and doing it better is I

think really really important and I

think it's forgot it's talked about but

it's only talked about in a lip service

type way most of the time the other side

of it too is look we're all fallible we

will make mistakes my team does

thousands of transactions tens of

thousands of transactions at this point

a day we are going to make a mistake

that's okay when we do make a mistake

our clients will give us Grace if we've

developed a great relationship with them

and you develop great relationships with

your clients by being responsive showing

them respect and really trying to scale

that service and so that's what from day

one Jacob my co-founder and I defined as

we we said this is going to be one of

our defining characteristics is

responsiveness so we took that and as

you know like you have one or two people

or it's just you you can do that that's

great then you start to scale and you're

like all right now I got to teach other

people to do it then all of a sudden

four years later decimal is at 91 people

and I can't just tell everybody what to

do we've got to create systems and

processes and Reporting and dashboards

and all that stuff so when we started to

scale we decided we were going to put a

system in place internally and a

technology stack in place internally

that allowed us to measure and track

responsiveness we've always had an SLA

of an under two-hour response time and

an under 24-hour handle time if possible

if it's a larger project then at very

least we want to make sure that we've

scoped it out and given people an

appropriate idea of when they can expect

to receive what they're getting so we

used front is a tool that we use for

it's it does a couple of things for us

it's a shared inbox so it means that you

get an email and rather than having to

forward it on to me you can just tag me

in it we can chat about that email in

the system it's fantastic I get less

than a dozen emails from my team every

year which if you think about it in the

scope of our business world is is pretty

crazy but what it also does is it tracks

response times so I'm able to look at a

dashboard my team leads are able to look

at a dashboard my coo is able to look at

a dashboard that tells us who's sending

the the most emails who's receiving the

most emails what is their average

response time and so we're able to

actually start to track that and to

train our team one of the ways that we

scale successfully good Services is by

managing off of a dashboard we create

good relationships but we start our week

by looking how are we doing on accuracy

how are we doing on responsiveness how

are we doing on escalations how are we

doing on all of these kind of kpis and

pushing that down to continue to create

effective output and great relationships

so we've systematized and scaled that

process part of it's looking at things

like I think there are great things that

Tech can take from Professional Services

and great things Professional Services

can take from tech one of the things

that and you and I've talked about this

that Tech does really well is they think

of ticketing when we get a customer

support request it creates a ticket that

then has an SLA around how do I respond

to it and so creating this entire

process training a team to do it and

then managing off that Dash board allows

us to constantly iterate and improve

while also hitting quality at the same

time there was a third part to your

question I think I totally missed but I

think that hit the first to I think we

got all of it it's why the obsession how

how do you manage it I'm curious you're

at six 700 clients now and and you've

been growing pretty quickly what

mistakes or lessons did you learn in

early days around communication and

response times that that you've kind of

built around as a result of those

mistakes sometimes I take for granted

that my parents taught T me how to use

good manners and so we actually do kind

of a manners training with people where

it's like just say please say hi say

thank you use your manners in an email

now we also started training in say

sorry it's kind of a lesson I learned

being married for 13 years which is I

start with I'm sorry and then I work

backwards of what like I find it's

really great when I start with I'm sorry

when my wife gives me that look then we

do that in business hey I don't know if

it was our problem but I'm really sorry

you're dealing with this I'm really

sorry that you've seen that I'm really

sorry that happened look into it just

the acts of just using your manners and

starting to train that into people the

other thing we did is we by using a

shared inbox it allows us to read each

other's emails and so we've created a

system where if somebody's sending an

email that's tough a lot of times

they're going to have somebody else just

hey will you give a quick look make sure

it it's a good email we've created that

kind of humble culture where people are

willing to work together and as you grow

you kind of default into certain

hierarchies and some of that's good some

of that's bad in a remote environment

using that type of connectiveness the

biggest thing that we've learned is we

don't make assumptions we make trainings

that help people do better and systems

that make it easier and so that's the

biggest thing is anytime you make an

assumption my mom always told me it

makes a you know what out of you and me

and in business it's the same thing and

so we've stopped making assumptions or

trying to tear down our assumptions and

building trainings and systems that make

it easier for people to achieve what

they should you mentioned that you have

90 some OD team members us outside of

the us as you have grown what have you

learned about how to build a deliberate

culture your model is a little bit

hybrid you've got some people local to

you some of your team members are local

other people are all over the world how

have you built culture intentionally in

that virtual slash a little bit inperson

environment we've got 91 people in five

countries in 26 States so I have four or

five people in Indianapolis with me but

our largest cluster of people is about

20 in Salt Lake City and that's because

we were lucky enough to make a really

cool acquisition of some amazing people

and they had an office first thing we

did was shut that office down and tell

them you're working from home now and

life gets more flexible you know the

pandemic changed things for everybody

for us we had already made the decision

to go remote what we've learned by

building a remote only team is you have

to be intentional about everything you

do just had lunch with a CEO friend of

mine and I joked I said hey you've got a

great culture but you totally lazily

built it because everybody was in an

office and having fun during all the

craziness when you don't have an office

those water cooler moments or those

lunches that people have they don't

occur so you have to create the space

and the shared work environment to be

able to do it so what we've done is

we've created a really great set of

values and one of them that kind of it's

not a true value of decimal but

something that stitches it all together

is gratitude where we are grateful when

people display the decimal value values

we talk about them heavily we thank

people for doing them we reward them for

it we share the pain the other part of

it is we've just created depth you know

very few people when they truly ask you

like how are you doing do they really

mean like hey man how are you doing we

try to ask that question really

meaningfully so that when people have

problems when people need help uh we

just ran a GoFundMe campaign for one of

our employees in the Philippines whose

husband needed an emergency surgery and

we said you know what everybody wants to

get together she's amazing we're all

going to band together and help her the

team over there helped send food we

helped donate and we just wanted to

create that type of cohesive team

environment I always struggled to use

family in a business sense but a team I

think can have a lot of those same

qualities and that's what we've really

tried to do and just giving people space

look we push our team hard as you said

we've grown I mean we started four years

ago and it was just my co-founder Jacob

and I in a room and now we have 91

employees over 600 businesses 650

businesses we work with and we're not

slowing down one of the things that i'

I've noticed that's really a requisite

if you're going to have a business built

around systems in processes and

procedures is a strict adherence to

scope of work in your mind where does

the bookkeeper accountant scope of work

end and where does a fractional CFO

scope of work begin we look backwards

and so when you start looking forwards

that's where a fractional CFO is a great

partner it's one of the reasons why one

of the first things we we did in our

first couple of months of starting

decimal was begin a partner program and

you guys are great Partners there's a

lot we can't do I'm not going to tap

dance out of my core competency I want

to find great Partners so that when we

do the backward stuff when we do today

and I view decimal and financial

operations and bookkeeping is today

backwards hey we're going to help you

pay your bills we're going to help you

get paid we're going to help you track

what happened when you start thinking

about a budget when you start thinking

about forward projections when you start

thinking about all of that strategic

forward looking that's where a CFO comes

in handy for us we're the process team

we are the Look Backwards team and we're

the make sure your business is running

today team one of the important words

that you said in there that I think is

critically important is partnership a

lot of times I see bookkeepers and

fractional CFOs operating siloed and

then the bookkeeper frustrated the

fractional CFOs frustrated and more

importantly the customer the client ends

up being really frustrated from a

bookkeeper's perspective or from an

accounting firm's perspective Matt how

can a fractional CFO best set up the

bookkeeper for Success what does that

look like what what do you need from

from my audience so that you can help

the client win think two things

partnership is a true shared experience

and when we run into fractional CFOs

that want to hop into meetings when

we're doing a financial close meeting or

when we're doing a quarterly review

meeting or when we're doing a weekly

what whatever that ends up being when

we're on there with a fractional CFO

when a fractional CFO will ask us hey do

you have five minutes just to chat about

this we love it because that means we

are sharing a relationship to improve

life for the client when we run into

fractional CFOs that or accounting firms

that hey you as a bookkeeper are less

than me I'm going to tell you everything

to do or I'm going to blame everything

on you that's not a good partnership we

don't want to do it ourselves we're not

going to do it but we do kind of run

into that general feeling of being less

than and to me everybody's equal we're

all providing an extreme value and if we

can do it together that's best best for

you best for us and more importantly

best for the client so to me that's the

number one most important thing is

really taking the time to establish what

are the good working relationships how

do we do it best how do we do it best by

client do we do it best for you we have

some fractional CFOs that'll Say Hey I

want you to get my client the their

books on the 20th I'm going to tell them

the 20th is totally fine because you're

really going to get them to me by the

12th and I want to be able to review

them before you get them to the client

that's a great working relationship we

came to a great decision it's slower

than we like to usually close the books

but hey if it works better for the

client five days means nothing I found

that where those things go south you hit

on this Matt is when there is no

communication like that's normally when

the Rel relationships get soured and so

that's why for us part of our onboarding

process is having an introduction call

with the bookkeeper with the new client

so we say hey we want an introduction to

the bookkeeper and what's important for

us is hey we want to understand what

your scope of work is what are your

deliverables what are those closeout

dates and then we want to share with you

what it is that we're doing what are our

deliverables what's our scope of work so

that you can help set us up for success

and I just don't see that conversation

happening enough in our industry it

tends to be silent and then everybody

gets pissed off and that's to me where

the blame game starts coming in while

the bookkeeper didn't do this the

bookkeeper didn't do that and I'm like

did you ever take the time to

communicate to the bookkeeper what

you're doing and what you need did you

ever bother to ask them what they need

and typically the answer I get is like

well no you know we we sent an email off

that one time four months ago and we

never heard back and so you start

getting the finger pointing the other

thing that you said that really

resonates with me Matt that honestly it

pisses me off is the arrogance that

comes from a lot of people because of a

particular title as a vendor oh I'm the

fractional CFO and thou shalt bow before

me on my golden or my Ivory Tower of

fractional CFO this and I'm like do you

not realize that you are dead in the

water if your bookkeeper the bookkeeper

on the team's not doing a great job in

setting you up for Success I'm like you

should really be great F and thankful

that you've got a bookkeeper there

that's doing it otherwise your value as

a fractional CFO is zero and so I would

just I would encourage anyone listening

to this if if if you catch yourself with

that little bit of snoot about you and

and where you are in relation to a

bookkeeper an accountant a CPA an HR

Manager a CMO or anybody else you need

to check yourself because we all need

each other's help to be successful to

make the client successful soapbox

complete oh I'm dude I'm right up there

with you takes me a few more steps to

get up with you but I totally agree

partnership should be a two-way street

one of the things that you mentioned

that just kind of tickled something in

my mind too is scope is exceptionally

important except if you very

intentionally determin to break it

slightly what I mean by that is having

an extra call occasionally with a

fractional CFO or with a bookkeeper just

to check in do a relationship check or

hey let's handle this together that may

be slightly out of scope but it makes

the rest of the revenue the rest of the

relationship better because you

strategically made a decision to do

something slightly out of it where I

find that some people struggle in scope

creep is when they become so rigid that

they refuse to do some of the right

things to make everything easier and

better down the road sometimes we'll

lose a little bit of money on

implementation because we took extra

time to understand a process here's what

we all know bookkeeping is the end point

of a bunch of operational processes CFO

work forward looking strategic planning

is the end point of what bookkeeping

provides that data you need good data in

for the opportunity for good data out

bad data in guarantees bad data out so

looking at that full ecosystem of the

data and the data flow and being able to

take some extra time to make sure the

downstream effects are fixed for the

better Upstream consistent quality I

think is also important to consider Matt

what's the biggest problem you have in

your business right now gosh that's a

great question I think the biggest

problem that I have in my business is

I'm impatient and change takes time and

that to me is always going to be one of

our biggest problems as entrepreneurs is

sometimes we're able to see what the

future is going to look like but we're

very tough in getting there we know how

to get there but we can be miserable

human beings as we push our team or want

to go faster or you know really want to

determine what are the right processes

to do it I would love to be able to jump

forward and get everybody to move at my

Pace but the reality is that doesn't

happen and so my impatience is a problem

sometimes I want to take that a little

deeper if you're willing to go how has

that played out in a real way inside

your business what kind of problems is

that created mat you know as we've grown

I have an amazing leadership team of

very experienced people people and what

they are very good at sometimes is

filtering my feedback down a level or

two but still providing me with an

opportunity to coach and spend I love

people so spending time with our

managers and directors I absolutely love

it doing it in a way that helps build

them up is better than doing it in a way

that has me coaching backwards I am not

good at that and people take my feedback

because I'm the CEO in a way that I have

to do that I have to over prior

prioritize what Matt said over what my

boss said and that's not the case and I

didn't mean it that way and I'm really

bad at that but when I'm coaching them

up so finding the right outlet for me to

spend time and Coach people up has been

a good filter and having the right team

and the right people with the right

skill set to then help manage that

process down and be that filter I found

to be very helpful for us and as we've

grown it's taken some guess in check

let's say I mean look when you hire 91

people over the course of four years

realistically we hired more than 91 to

get to the 91 we have today and so it's

been a process I learned that lesson in

the Navy and then I don't have any time

since then is is the team gets bigger as

as the boss or the CEO or whatever it's

really easy if you're not careful to

make a recommendation or just to even

ask a question hey uh yeah have you guys

ever thought about painting the wall

blue just a random question and then

next thing you know like everyone's

dropped everything that they're doing

and it's like Mike said the walls got to

be blue stop what you're doing you're

like what the heck I was just it was

just a random question I was just having

to you know shoot in the breeze with you

so you've really got to be careful with

with those even just questions that you

ask and make sure that the expectations

like hey I don't want you to do anything

with this I was just having a

conversation with you it's uh more than

once I've turned around and seen the the

wake of my questions or suggestions and

uh I'm like oops I got to be careful

with that my coo had to create a rule

and we've had to train everybody on this

rule including me which is I'm not

allowed to give people work I have to

direct work through and if they hop into

a meeting with me and I give them work

they have to check with Michael to make

sure that it's actually what they should

be doing and so it's it's this mental

key we've had to train into people is if

you think Matt gave you work check with

me because chances are Matt didn't

really try to give you work or if he did

he's already filtered it through me and

I'm going to tell you to do it but we've

had to to work on that cuz you're right

is what I've noticed when you grow as

fast as we have my job has changed

dramatically every 6 months and when you

develop a growing organization your job

and and you're seeing this today with

with your jobs your job changes what is

needed from you changes and how you have

to give and take changes and very few of

us and I'm not in this group are really

good at doing that ahead of time we

usually don't realize it till we made a

mistake and have to admit to everybody

I'm sorry from now on I'll do this Matt

one of the big lessons that I've learned

in the last year or two is that as as a

executive of a two growing businesses in

in my case or or as an owner as a CEO

just like you just mentioned you you get

to these new stages and with every new

stage I've recognized that in in some

way and sometimes in many ways I have to

become the beginner again that new stage

has presented new challenges it demands

new skill sets it requires new things

from me and in order for me to grow into

and through that I've got to be okay

with the fact that I'm a beginner in

some way shape or form again I have to

be okay with the fact that I'm going to

make mistakes there's going to be

problems that come from it my question

for you is in this season of business

that you're in now with the scaling or

whatever the case may be in what ways

are you finding yourself to be a

beginner I'm always a beginner if you do

business long enough you learn how

humbling life is and how humbling

business is and you're right you have to

change and you have to be willing to

admit you are wrong and those are things

that I didn't grow up emotionally

thinking were that important growing up

as an athlete and doing all that stuff I

was you know I'm I'm great at some point

in your life you look at yourself in the

mirror and you say this facade I've

built for myself is only partially true

here's what the real me is one of the

things that I've been doing a lot of is

is truly figuring out who I am and how I

want to lead my team and I figured if I

do that well it will help me be more

successful leading my company it'll help

me be more successful as a parent and as

a husband and as a friend and the more I

try to kind of Silo that and not

actually be willing to dive deep the

harder and more isolating it is so for

me truly getting into an understanding

all the emotions of running business

there are some amazing Parts anybody all

of your fractional CFOs you start a

business it sucks it is freaking hard

but there's just that little bit if you

truly like entrepreneurship that will

keep you coming back every single day

and then you'll get bigger and bigger

parts of Joy but then the roller coaster

always goes down too and you're going to

have hard things life happens so for me

I've realized there's a lot I don't know

I hired people that are I have a COO

who's run more companies than I have he

is way more skilled than I am at truly

managing a team I have a business

partner that's smarter than I'll ever be

surrounded myself with people that make

me better and cover my flaws and then I

openly admit to people that I want to

get better and when I make mistakes and

one part of my self-discovery is I'm

starting to talk to more CEOs I've

started doing some coaching of hey this

life is isolating it's okay let's talk

about it there are a lot of people that

are sitting out there wondering am I

alone in this and I don't don't think

they should be our mission at decimal is

to make it easier to be a small business

my company does that by helping take

over one of the painful parts that you

have to do let's help you operate Let's

help make sure you can pay your bills

get paid and track it all me personally

I want to help make it easier for you

for me for other CEOs that just feel

like life sucks sometimes and that's

okay or gosh I need somebody to

celebrate with because I can't fully

celebrate this with my team because I

don't know what impression they're going

to get from the whole thing so like

that's there was a little bit of a

rambling answer but I think there's a

lot packed into those questions one of

the questions or one of the ideas that I

I wasn't even aware of until years in

into business the idea of embracing the

role of the beginner and being okay with

that letting my ego just be

uncomfortable with the fact that I'm

going to suck at something and the fact

that I suck at it isn't a problem it's a

necessary part of the journey towards

Mastery and and to breaking through to

the next level and and just just knowing

I think that as long as you're in

business and honestly it's probably a

proxy for life if you want to grow and

if you're willing to grow then you're

going to have to be okay being the

beginner at each stage of your life and

that's it's part of the process not a

problem that's unique to you well let me

add a a caveat to what you said because

I agree with all of it I find a defining

characteristic of people are who are

successful being entrepreneurs just in

an individual role is being curious

because if you're going to be a beginner

you have to be curious about figuring

out how to not be a beginner and that's

why I have CEO groups I'm part of I have

a CEO coach I love reading I love

talking to people like you that have

done things that I've never done because

I'm curious about learning how to get

better and also how to decrease the time

as a beginner at each new stage so I

agree with you 100% what have you

learned about sales my first job in Tech

I left the law firm and I got a job and

I I got into sales I love sales I love

selling to people to me it is building a

relationship and getting people to trust

you and getting people to trust that you

have a solution to their pain when

you're in your role you're selling in

multiple directions every single day you

are selling to your prospects or clients

you are selling to your team I'm selling

to investors I'm selling to my wife I'm

selling to my kids so I'm selling in a

multi-dimensional way every single day

I'm also selling to myself is this a

good idea a strategy I have there like

to me it's it's a conversation that

you're having and you have to have the

courage to be able to do it

authentically one of my first companies

I ran I took my sales team to a car

dealership and I said hey we're going to

sneak in the side door my grandpa ran a

car dealership for years when I was

growing up and I said I want you to

listen to how all these car dealers how

they you know shoot the and talk

together and then we're going to leave

we're going to walk in the front door I

want you to notice how their demeanor

how their tone and how everything about

them changes compared to how they were

talking because CU I wanted them to see

what inauthentic sales was as a counter

to what I wanted them to do which is be

yourself you you're selling you you know

you you've done it in every stage of

your life and everybody has done sales

sales to some people particularly in

Professional Services feels like this

mountain I have to climb for the first

time when they don't realize that

they're standing on another Mountaintop

that's exactly the same and it's just a

different one that they have to figure

out that to me is sales do you think

that it's important for a CEO whether

it's a a solo preneur or got a team of 5

10 50 or 100 to at least in some way

take on that role or that identity that

I am a salesperson if you want to start

a business put that hat on you will

never take it off you are a salesperson

you will be a salesperson period what

advice or encouragement would you give

to somebody that says I'm not a

salesperson so what do I do well we just

mentioned earlier be curious go learn

how to do it there's a lot of stuff out

there the other thing is is I don't know

about you but I can't tell you how many

times my wife and kids have walked in on

me practicing my sales pitch in a mirror

I mean it actually works and now you

have zoom or Loom or whatever you want

to use to to video yourself practicing

and I would recommend practicing

practice is essential to progressing

towards better and I would also you and

I kind of talked about this a little bit

too is when I hired new salespeople at

times I would have them practice on

prospects that probably weren't totally

qualified for decimal because it it just

got them a real person I'd have them

practice with decimal clients I'd call

up buddies of mine and say hey got a

favor can you do 30 minutes with my new

sales guy let him sell you on decimal I

know you're already a client I'm not

going to give you a discount for it but

consider it a favor to me you have to

wear that hat I gave a talk to some new

tech entrepreneurs a couple of years ago

and I told them I said hey every company

I've started I have personally sold the

first 1 to $1.5 million of Revenue

because by then I had learned enough to

train somebody else how to do hiring

salespeople too early in an

entrepreneurial journey is guaranteed to

fail because they will not learn as

quickly as you will you need to learn

enough to train somebody how to do it if

you don't truly want to do it yourself

that's a huge misconception that I see a

lot of people have is they say I'm not a

sales gal or I'm not a sales guy I'm

going to just go hire somebody they

bring that person in before there's a

Playbook before there's an understanding

of the client and their needs and their

pain points and the value that you bring

and then the salesperson ends up

floundering because there's no way that

they're going to have enough time like

you're you're not going to be able to

compensate them long enough for them to

figure it out and the truth is most

salese are good at executing on the

Playbook not at creating the Playbook

and so if you bring somebody in like a

VP of sales or a cro you're gonna have

to pay them so like you're not going to

be able to afford them it it because

it's going to take them so long to put

it together so I I agree with you 100%

you youve got to be I and I think you're

directionally correct too on the number

it's million million five in sales

really needs to be done by the CEO I

mean my firm's been around eight years

now and we were talking about this

before with the interview I'm just now

at the point where I can kind of start

handing it off and I've learned a lot on

how to do that quicker so my second

company we're two years in over a

million or actually a million and a half

in Revenue now now I'm able to hand it

off but it's still interestingly that

you know million and a half mark and

we're just now talking about how do we

how do we handle hand hand the sales off

but I agree with everything you said

Matt I think that you've got to be

willing to take on that identity that

it's not that I'm not a salesperson it's

I'm a salesperson that happens to suck

right now and then the two things that I

think is important that you pointed out

I'm going to reiterate it one is be

curious study it learn it but number two

you got to get reps there is no sales

language or formula or script that

you're going to learn and then be

immediately great at sales withd you've

got to just get in the game and get on

the sales calls talk to prospects that

you know you're not going to take their

business or that you know aren't a good

fit in those early days just to get the

Reps and so I think it's a a really

important blending of the studying and

the practicing that's where you can go

from I'm a salesperson that sucks today

to I'm a mildly competent salesperson to

I'm a good enough salesperson with a

Playbook that I can now hire somebody to

come in and replace me I think that's

the journey I agree and don't overlearn

you'll learn way more doing and and some

people that haven't done that they they

think I'm going to I'm going to make it

all the way through this learning I'm

going to make it through the other

learning and it's the freezing of

inaction and momentum is so success is

so much a byproduct of just movement

moving forward moving backwards moving

forwards and I think that that's also

really important is just just go time

box yourself and just go cuz I call it

the Field of Dreams entrepreneur so many

people start a business with that theory

of if I build it they will come and that

never happens but it's fun to learn no I

wish it did I'd start way more

businesses if that worked out what are

the biggest frustrations Matt that

fractional CFOs have with new clients is

I would go almost invariably you get a

new client you start to onboard you

realize the books are trash there's

somewhere between not great and really

bad and if a fractional CFO doesn't get

that buttoned up relatively quickly

they're not able to do their thing and

so one of the questions I get all the

time is like hey what do I do if I find

a client that's got really bad books and

my answer now is like well we just go

straight to decimal we go straight to

decimal you've got the onboarding

process dialed in you can get the books

workable pretty fast if somebody's

listening to this and they're like gosh

I need somebody that's totally

operationalized and systematized this

somebody I can trust to to work with me

me while I'm onboarding the clients how

do they reach out to you to to see if

you're a good fit for their clients so

it's easy decimal.com go on there or

Mitchell with two L's at decimal.com

leads our sales team he would love to

talk and the great thing about Mitchell

is he started running our operations

team and he's got that accounting

background and we would love to help my

goal in these Partnerships our goal is

to put you in a position to be

successful and to do it as quickly as we

can because we both both know that

that's exactly what these fractional

CFOs need and so we'd love to help we

want to do the operational stuff without

tap dancing on your core competency

because it'll never be ours we'll drop

the link to Mitchell's email address and

to dmol in the comments below Matt

thanks so much for being here today man

I appreciate you taking the time dude it

was awesome I really appreciate the time

and this has been a great partnership

and we really enjoy working with you and

the whole team all right that's it for

this week's episode of the CFO report if

you'd like to connect with Matt and his

team at decimal we've included all of

the contact information in the

description below but if you're a

fractional CFO and you're looking to

scale your firm if you're looking to

scale your impact and you need help with

things like sales with things like

marketing and prospecting I want to

invite you to join me in Dallas Texas

May 15th through 17th for the CFO

accelerator live go to the CFO

accelerator live.com or click the link

in the description below to learn more

in the meantime I can't wait to see you

back here next week bye friends I'll see

you then

[Music]