From the course: Running a Design Business: The Staffing Rule Book
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Six important financial rules
From the course: Running a Design Business: The Staffing Rule Book
Six important financial rules
- While this course doesn't cover the costs or financial models of running a creative business, I do recommend six foundational rules about money that specifically relate to your organizational structure. One, except for any mortgages, you shouldn't grow or hire until you've eradicated any debt, including any back taxes. There may be some exceptions to this rule such as the PPP loans during the COVID-19 pandemic, but in those cases, consult your accountant or financial advisor. Two, you should always have a cash reserve that covers at least three to six months of overhead. This will be your financial cushion during slow times, and your security when you have to hire someone before taking on additional new business, as sometimes you have to take a risk to hire someone before you can't afford not to. Three, profit is not proportional to how many employees you have. Sometimes larger firms make less profit than the…
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