00;00;00;00 - 00;00;24;10

Unknown

Welcome to the Profit First for Real Estate Investors podcast. This series is the simple CFO Case Files, where our CFOs break down real client scenarios, financial systems and practical decisions from inside the business. Enjoy the episode.

00;00;24;12 - 00;00;53;23

Unknown

Christina Gutierrez here and partner at simple CFO solutions. And welcome to the simple CFO Case Files, our very next episode where we are pulling back the curtain on exactly how we help real estate investors transform their businesses. So we're hearing it directly from the CFO to do the actual work. So today, in every episode, we're talking about exactly how we use the actual system, not just wins, not just what's going on, the actual tools, the process that we use every single day to transform our clients businesses.

00;00;53;23 - 00;01;15;18

Unknown

So today I am here with one of our probably longest CFOs that we've had, Michael Hansen. He's been a CFO for quite some time. He's he's actually been very instrumental in simple CFO altogether. And he just continues to, you know, knock it out of the park and proves the businesses for not just simple CFO, but all the clients that we work with, no matter what it takes.

00;01;15;22 - 00;01;38;25

Unknown

Michael has made a huge impact with me in general. I actually met with him a lot when I came on, and we've actually built a very good relationship. I really enjoyed working with him. So Michael, welcome and thank you for joining me today. Thank you. It's it's it's my pleasure. And I'm certainly looking forward to this conversation. It's been wonderful with you as well.

00;01;38;27 - 00;02;08;14

Unknown

Thanks. So real quick give us a 3060 second. You can never do it in 3060 second. Wrap up of you know what the clients that you work with are, what type of clients you are, how do you work with them? What's so important about the work you do? Excellent. I appreciate that. So I historically have worked with many of our multi entity and larger clients, as well as our very fresh just getting started clients.

00;02;08;14 - 00;02;35;06

Unknown

So I have a real passion for helping clients move the needle regardless of what stage they're at. And I try my very best to kind of meet them where they're at. So I have as long as a business owner is ready to move their business to the next level. That is what I specialize in, is helping them kind of move to that next level.

00;02;35;08 - 00;02;57;03

Unknown

Sometimes that means fixing what's broken to get them back to neutral, and then we rocket ship. Other times they're already on fire, and we figure out how to light that afterburner and do even better. So that's a general this. I know our conversation is probably going to get into more specifics, but I'll leave that to you, the guide.

00;02;57;03 - 00;03;30;17

Unknown

And that's the gist of how I work with my clients, or at least my overall goals for that. Yeah. And sometimes, you know, they can come to us on fire in a good way and on fire in a not so good way. Totally agree. Totally agree. And that's yeah, the variety is what I absolutely love. Between the support that we get here at simple CFO as a team and the variety of clients, even though we specialize in in the real estate investing world, which is amazing.

00;03;30;20 - 00;03;55;26

Unknown

I was introduced actually many years ago when I started with simple CFO to the industry and have dove in. I now consider myself a pretty adept at understanding the real estate investing world. And so that was that was a gift that was given by David and the rest of the team, Christina included. To me, I would I would agree with that.

00;03;55;26 - 00;04;18;13

Unknown

I would agree with that statement. And that's perfect that we're talking about that because, my very first question that we all know that people look for a CFO because they might have some type of pain in their business. Right? They either don't understand the numbers, they don't know what's going on. There's a breadth of reasons why they would even call us and say, because most people think, I don't even know what A is.

00;04;18;13 - 00;04;42;15

Unknown

So I have an accountant, I have a bookkeeper. So what is what do you think is their financial pain? What do you see when clients come to you that their actual pain that they're in is that you can help them with the excellent question. I think that the pain that most clients have boil down to the same exact thing, even though it comes in lots of different flavors, right?

00;04;42;16 - 00;05;14;14

Unknown

Where the 31 flavors of financial distress, basically. But it really all boils down to that one thing, and that is at least my observation. Okay, okay. I love that our the name of our business. I'm just prefacing my answer here is simple CFO okay, that's one of the things that I've kind of built a foundation on is because oftentimes we need to over we need to simplify the actual pain that they're creating is what I find.

00;05;14;16 - 00;05;54;07

Unknown

And where it all comes down to is having the right amount of cash in the right place at the right time. So cash flow management and understanding how cash flows through a business is, in my experience, the foundational pain point that people sometimes aren't able to have language around or articulate. But that's where it really comes from. Having the right amount of money in the right place at the right time for the right purpose, and creating systems around that commitment has been at all levels, right at all levels.

00;05;54;07 - 00;06;19;28

Unknown

For those, as I mentioned, I've worked with a lot of our multi entities, some that you know, from 3 or 400,000 a year in revenue to $50 million a year in revenue. And it's the same answer, Christina. It's really the same answer. It's not having the right amount of money in the right place at the right time and systems around it to commit to that.

00;06;20;00 - 00;06;46;14

Unknown

Yeah. That is so well said. Yeah. So well said. And that's true. I mean they say what did I hear. Cash is king, profit is queen. And there's something else. Then processes are I don't know I can't remember right now. But there's a saying to that. Right. Because you can look profitable all you want on the books. But if you don't have any cash, you really don't have, you can't make your next moves, you can't put cash into anything.

00;06;46;14 - 00;07;15;06

Unknown

You can't accomplish the goals because revenue is just a number that sits on your income statement. Exactly. And one of the things that I find absolute joy in, in the very first part of working, is when the light finally comes on to where a business owner will understand the difference between profit and cash. Okay, so profit and cash or even revenue and cash, right?

00;07;15;08 - 00;07;48;21

Unknown

So I think most most of our clients, real estate investors understand the difference between revenue and profit because they know they've taken a lot and they hope to keep a little right. That's that's kind of the way it works. But cash is so much different. I mean, you know, that that profit and loss or that income or that profit at the bottom really is a report of what you created in theory on paper, but it doesn't tell you about the capacity that you have to make new decisions today.

00;07;48;23 - 00;08;17;03

Unknown

Right. Because the old thing of, geez, my accountant told me, I, oh, I made $100,000 and I owe $40,000 in taxes. How am I going to pay for that? Well, that is that's the first indication that the $100,000 felt good, and it gave us confidence that we're moving in the right direction, but it didn't give us capacity. So the difference between having confidence and capacity is really important.

00;08;17;03 - 00;08;26;16

Unknown

And that's where cash comes into play. So that's long answer to a very simple question. The the.

00;08;26;18 - 00;08;50;00

Unknown

The marshaling of cash has been the biggest common denominator that I have found in most of the clients that I work with at all levels. Yeah, I think I agree, and I couldn't have said it better myself because that is so true. All right. Let's talk about your first 60 days. So kind of always had this this feeling of, you know, we want to hit the ground running.

00;08;50;00 - 00;09;14;00

Unknown

We want to get you exactly what you need in the first 60 days. We want to lay the financial foundation. So we accomplish that through using our tools, implementing profit first, getting their CEO dashboards set up. Tell me what the first 60 days with the client looks like for you. Excellent question. So I first of all worked very, very hard to establish what we're actually.

00;09;14;02 - 00;09;42;06

Unknown

So I basically tell that same story okay I, I help translate. So the very first thing is clarity. Okay. I want to make sure that we have a clear picture of not just the entire business, but I focus on the lowest hanging fruit. Right. So I go very vaguely over the big picture in the very beginning. And that includes how clean their books are, all of that stuff.

00;09;42;07 - 00;10;06;14

Unknown

Okay. And then I very yes, I do. I'm sorry. Financial assessment. Financial assessment. Assessing from the from the high view. Yes, yes. From a very high view I do a financial assessment and it kind of tells us what the score is. My primary focus is how much cash do they have in the bank today. That's my focus. They don't know that.

00;10;06;14 - 00;10;30;15

Unknown

But I look that's where I look for the immediately. And then I start to have a conversation that helps them get their head around getting cash square, because it is not something that comes, even though it's very simple and very obvious. Once we start to work on it, it isn't what they think we're going to be working on, right?

00;10;30;17 - 00;11;01;07

Unknown

It isn't what they think we're going to be working on. And part of that comes from your right. Most folks that we work with have never had a financial professional on their team working specifically for them. They may have worked with outside consultants or cash flow. That is teaching them some concepts. But where simple CFO shines is we get in the trenches as a partner, and I know I speak for many of our other professionals that are helping with simple CFO.

00;11;01;09 - 00;11;22;19

Unknown

It becomes our business whether we own it or not. Right? We think of it that way. I know for certain clients that you've described that that's exactly the way and that's always the way it's been for me. So I really try my best to help them understand how to work, how to extract as much value out of our services as possible very early on.

00;11;22;27 - 00;11;46;13

Unknown

Right. Because what I don't want is for them to have some kind of false sense of reality, of what they think our job really is. Right, because they come to that with either no knowledge, as you said, or some kind of assumption that it's what it's not. So I work really hard very early on to say, these are our goals, correct?

00;11;46;13 - 00;12;07;22

Unknown

Yes. And I don't mean what they said. I try to shift their goals to things that we can move the needle that can often get to where they actually want to go. So what they call their goals have lots of steps in between to get even close to those goals. So I break it back down to the lowest hanging fruit, and that's usually cash.

00;12;07;25 - 00;12;32;13

Unknown

And so that first 60 days we do that. One of the things that I focus on with real estate investors in particularly is their cash position. Okay. And I literally even though we paint a picture of where we'll head as soon as we can get that square, what I try to focus on is their cash position. What is how much cash do they have?

00;12;32;15 - 00;13;05;07

Unknown

What have they already committed to? Whether they even internalize it as a commitment or not, I help them understand the actual commitments that they've made so that they don't commit the cardinal sin, which is what's happening, and that is making multiple decisions with the same dollar and not realizing it. Okay. So my my personal way of working with them is to get a good handle on that cash position.

00;13;05;10 - 00;13;25;25

Unknown

And then once we've done that, or at least the need to look at that cash position on a very regular basis, on a very regular basis, the next step is, okay, let's see what the data that we're creating in your business is actually telling. What kind of a story are we telling you. And that's the financial clarity piece okay.

00;13;25;27 - 00;13;47;25

Unknown

That is the next piece that is really necessary for us to serve, at least in my experience, and that we have to be able to see the results that we're creating and how we're doing that. So I take a look and I do a full financial clarity assessment of is are the is the data. And that's also called the books.

00;13;47;26 - 00;14;24;27

Unknown

Right. The books are the books telling us a story that hopefully a really bright kindergartner could read, as opposed to a full on financial professional? Are there acronyms being used, or they set up in a way that it'll support the cash management systems that we put in so that we can actually clearly see it? Are you using the detailed information that you're currently keeping to make decisions with, or you just keeping it for the sake of it and those kinds of decisions?

00;14;24;27 - 00;15;00;23

Unknown

So we go in and we really work with them and or their bookkeeper and or CPA to make sure that we have a chart of accounts and a set of books that really serves them for management purposes, not just compliance purposes, meaning tax purposes. So first 60 days, it takes us, in most cases not all, but in most cases that those two things right there, getting your cash position square and financial financial clarity is my first 60 day focus.

00;15;00;26 - 00;15;27;07

Unknown

Unless they have something that's keeping them from focusing on those two things. And then I say, okay, that can happen. I'm going to set this aside and we're going to deal with getting your mind, at least if not solving that problem finished today. And we won't move on until that becomes a manageable or a non-issue for you. Because I've been around long enough and I have enough trophies right here.

00;15;27;07 - 00;15;50;10

Unknown

These gray hairs that I have to know that if I can't get a entrepreneur to focus, then you know, and you know, it's their problems that we're worried about. Not not what Michael thinks their problems are. Whatever is on their mind is. Anyway, that's my first 60 days, right? That's why, you know, you're right. That's when they come to us and that's where we say we meet them where they are.

00;15;50;11 - 00;16;10;11

Unknown

Right? Because we can convince them. We can talk to them about all the things which they do come to us for our advice, but they not outside of what's already wearing them down. So going back to your first, you know answer and your first comment about meeting them where they're at, you can't change their mind and they come with us with some type of financial pain normally around cash.

00;16;10;11 - 00;16;33;09

Unknown

And you have to get that organized. So, you know, we're built on profit first, right? Because the book Profit First for real estate investors. So when do you say you because you got assess it right. You can't implement a profit first system on numbers that aren't correct. So then what do you do with how do you use our dashboard, our tools, what we have in place to actually start implementing profit first for them?

00;16;33;11 - 00;16;56;13

Unknown

Oh excellent question. So I love our tools. And what I do love about our tools is we've got a myriad of tools, some of which apply to the specific time frame and or the individual. And so I try my best to visually limit it to the tools that we're focused on. That's the very first thing as I go into that first tool, that dashboard.

00;16;56;13 - 00;17;32;14

Unknown

But the very first thing that we start with is a profit first. When we start to look at clarity and to start to look at implementing profit first, we do what we call a profit first assessment and rollout plan, or that's what we call it a profit first assessment and rollout plan. And a lot of that has to do with both the clarity that we've already established, meaning the cleanliness of the books, but also kind of assessing the actual cash flow to determine how we're going to set up profit first.

00;17;32;14 - 00;17;55;21

Unknown

So we have a whole tool on our system that helps us with that, that cash, that cash position. We also have a tool on the system that helps us with that cash position as well. And I usually move that one right to the front. I move that tab right to the front, right in front of the dashboard. And then I put the profit first assessment and rollout plan next to it.

00;17;55;21 - 00;18;15;26

Unknown

And that's where we that's where we start out with. Awesome. Yeah. Because they got to know where their money's going and they don't realize it sometimes. You know you look at their expenses and they say, wow, I spent that much on 50 subscriptions. Why did I subscribe to that many. So see a lot of money going out the door.

00;18;15;28 - 00;18;39;12

Unknown

Yeah. All right. That's awesome. So a lot of people to they think, you know I can do profit. First I read the book I can I can implement this. So two questions. Kind of like why are we so different than just a DIY. They can do it themselves. And if you have like someone that's coming before and said, like I already implemented profit first and it just we had to kind of revamp it a little bit.

00;18;39;13 - 00;19;12;07

Unknown

Yeah, yeah. Some profit first is a beautiful, beautiful system because of its simplicity. But I've never and by the way, literally every client that I've ever worked with and perhaps I'm sure that it's the same with everyone, are super bright people, right? They get it. And oftentimes what I describe profit first as, as the dumbing down of cash flow management.

00;19;12;08 - 00;19;34;25

Unknown

Right. Technically speaking, it is really the management of a statement of cash flows. That's really what profit first is, because that's what it tells us. But who can manage a statement of cash flows? It's very confusing. So what we do is the statement of cash flows, by the way, ties the balance sheet and the and the profit and loss together and gives us an overall picture of that cash flow.

00;19;34;25 - 00;20;27;12

Unknown

Anyway. Point being, the profit first system is simple, but it's not always as intuitive as you would think. It is one of the very first rules in both Mike McCallum's original book, and I know that David mentioned it as well. The Cardinal Sin and the number one sin I see, and 100% including clients I work with today, is the dying systems that most entrepreneurs put together themselves are overly aggressive, so they start with what they were, where they would like to be, or where they think they could make sacrifices and they set their allocations way, way too aggressive.

00;20;27;14 - 00;20;47;25

Unknown

And literally 80, 90% of the time it is it will either fail or it will, at a bare minimum, be less than optimal. And by the way, most of the time it's not giving them what Proverbs could actually give them if they went through a much more.

00;20;47;27 - 00;21;07;16

Unknown

Gradual urge to it. Yeah, yeah. Build it out for quarters to come. You don't have to rush it. That's right. You know, you don't have to do it in a week. It's like people used to tell me when I wanted to rush through school. It's like, well, you're going to turn 30 regardless. So you're either going to be 30 with a degree or 30 without a degree.

00;21;07;19 - 00;21;25;09

Unknown

That kind of hits me as like, you know, there's there's patience to everything, and if you move too fast, then you're going to end up there's another cardinal sin, right? Transferring money from here to there to here to there and then now it just becomes a confusing mess. All you have now is bank accounts that hold money. That's right, that's right.

00;21;25;13 - 00;21;51;01

Unknown

Yeah. It's about, you know, having the right amount of money in the right place at the right time for the right purpose, not just moving money around and. Right. So and that's something that oftentimes the other part of profit first, that is confusing for DIY folks that put it in there is they overemphasize not overemphasized. That's a that's the wrong word.

00;21;51;01 - 00;22;13;04

Unknown

But listen, I describe profit first as the combination of two concepts. One of them is a pay yourself first and the second is grandma's envelopes. Right. So grandma's we're you know, we're implementing grandma's envelopes in multi-million dollar businesses. That's what we're doing, right? We put money in the envelopes and we we're not going to spend the rent money on.

00;22;13;07 - 00;22;39;14

Unknown

We're not going to spend the rent money because we've run out of food. We're going to make a pot of Chile and make it last till payday. That's what we're going to do. Okay, so that's the whole concept really. And we're doing that in businesses. But what I do find is that the whole pay yourself first part sometimes gets out of line, okay, you can only pay yourself first.

00;22;39;20 - 00;23;13;27

Unknown

First of all, committing to paying yourself first is 100% in alignment with what we teach. No doubt about it, the amount that we pay ourselves first is not necessarily the part that's in alignment. So what we try and do, what we try and do is set it up so that the way I have combated that is that I focus 100% of all of my private first implementations on one thing and one thing only in the very beginning, and that is owners compensation, right?

00;23;13;29 - 00;23;43;06

Unknown

So I choose to do a personal deep dive into every client that I work with. I take them through a nauseating, repetitive series of questions that are basically the same questions, 50 different ways to really understand what their actual need is. Okay. And that's not what Michael thinks they're need is. That's what their lifestyle is. So I say we're going to define what it costs to fund your current lifestyle.

00;23;43;06 - 00;24;09;29

Unknown

And we're going to build your cash plan around that. And then I'm going to back in to that cash plan to see can the business sustain that cash plan. If it can, we're golden. If it's can't, then we got some work to do. But that's going to be entirely up to the owner to decide to make those adjustments for themselves.

00;24;10;01 - 00;24;31;08

Unknown

We also find that they're not paying themselves what they probably should given their investment of time, energy, money and risk. So that also happens. That also happens, there's no doubt about it. But I want to make sure that listen, if an owner is not paying themselves enough to sustain their lifestyle, they will take the money, they will take the money because that's the priority.

00;24;31;08 - 00;24;51;12

Unknown

They're going to take the money and they're going, those are the ones, not the ones that are underpaying. The ones that are overpaying will take the money anyway, so we have to deal with that first. All right. That's why they started the business to support them. So to get to that number, I like how you brought important to importance to that.

00;24;51;12 - 00;25;09;22

Unknown

And you know sometimes they don't know. And it is about asking those questions. Sometimes they don't know what they what they need. They have a need number. They have a want number. So but when we're asking the right questions, it's so different from DIY. They can't not do it correctly with the help of a CFO on their side and walking them through the process.

00;25;09;23 - 00;25;29;16

Unknown

Yes. So that's that's important. I like how you touched on that. So the simple CFO dashboard that took forever to implement, it's got a lot of sheets of skylight of tools. There's so much in there. But we try to make it so it can help all the clients. That doesn't mean that every client needs 20 sheets, right? They're all different.

00;25;29;16 - 00;26;05;08

Unknown

So, walk me through a couple of your most important sheets on the dashboard and that resonate with your clients and help you and then make decisions together. Yes. And I actually on a regular basis, I do find individual sheets that I use for very, very specific situations, but for the most part I use the same 4 or 5 sheets because my approach is so cash focused that it generally focuses around those few sheets.

00;26;05;08 - 00;26;29;19

Unknown

And that is once we've gotten through the problem first assessment rollout plan, the the allocation sheet is the one we use the most. In fact, that's the one that our clients use themselves on a regular basis. That allocation sheet that tells us how we're going to actually allocate monies that are in our deposit account or our incoming account.

00;26;29;21 - 00;26;59;16

Unknown

I also use the I have to, I have to admit, I start with in the very beginning until I know that my the books are super clean and that we have them flowing properly into the sheet. I use a legacy cash position calculator that I created many moons ago to start out with, and then the most important that I have found is that cash position managing sheet.

00;26;59;17 - 00;27;18;23

Unknown

I'm even having a hard time remembering exactly what the tab is called. That's because we've changed the names of it a couple of times. So it is cash position. But most people find that that since it relates to the property, the owners see property management position or property management, cash flow system. I can't think of it either.

00;27;18;23 - 00;27;37;26

Unknown

But just so you can see how the cash flows in and out and sensitize directly to QuickBooks, it can pull everything in. Yes, every every morning it automatically updates. And then you get all your current numbers of what they spent and what they're doing. Yes. And I as you mentioned earlier, I want to jump on jump in right now and running.

00;27;37;26 - 00;28;03;01

Unknown

And oftentimes the financial clarity piece in the books don't paint the picture in that automated system on occasion. And so I look at it, if they're pulling the way I think they should be pulling, we'll do that. Otherwise I have an alternative sheet that I pull in and we do a very much manual process. It's a simplified version of that sheet.

00;28;03;03 - 00;28;21;16

Unknown

It seems to work, but we have a good idea of the commitments that we've already made, knowingly or not. And we know how much cash we have and we can. And every single week we update that on a manual basis. That's the old way we did it. And that's fine. I got I got the longevity to prove that it works.

00;28;21;19 - 00;28;41;13

Unknown

But I love the automated system now because it's super it's super intuitive now and it really helps a lot. So both are wonderful tools. Those are the primary ones I use. I mean, honestly that, you know, out of all the tools that we have, those are the ones that I primarily use. Right. Because you got to make sure the cash is, you know, in order.

00;28;41;16 - 00;29;07;14

Unknown

Yes. Definitely important I agree. All right. So let's wrap it up a little bit. If you had to pick one client success story that fully demonstrates how a simple CFO system worked for them or is currently working, doesn't have to be like a full transmission transmission transformation, but just kind of what their problem was. What did you do for them, what systems you set up and how things are going for them now.

00;29;07;14 - 00;29;55;00

Unknown

And it hasn't even been named just. Yeah. No. An example. Yeah. And it's the current client that I've been working with. It's probably been three years, but I'm just going to say about two, two and a half years. One of my very favorite people, let alone clients on the planet. Super, super. The whole family is amazing. But anyway, so they had a issue about two and a half years ago when we first started working, where they were building three different exit plans in their business, focused heavily, heavily on flips, a couple of whole tails and but they're ultimately sorry, a couple of wholesales and some whole tails as well and really focus.

00;29;55;00 - 00;30;18;28

Unknown

But what they really want to do is build wealth in the long term, and that is to build a rental portfolio. And they were kind of scrapping at that. Well, we got in and at the time I think he might have had I'm not going to say, well I will because I'll say the amount now at the end, he was running between 0 and $10,000 in his bank account, depending on the day.

00;30;18;29 - 00;30;40;00

Unknown

Right. It was up and down, up and down, up and down, up and down, up and down. The the flips were way, way causing him to have a cash problem. If you look at all the flips that he did, he knows how to buy. He knows how to renovate. He knows how to do everything. Every single deal was a profitable deal.

00;30;40;01 - 00;31;01;14

Unknown

But it illustrates the first subject that we talked about. And that is timing. Okay. Timing on cash flow is your biggest issue. And so that was basically putting him behind. And he's a smart guy a hard worker. Anyway we made a decision to catch up. What's that trying to catch. Yeah. Constantly playing catch up and just really defeated.

00;31;01;15 - 00;31;26;06

Unknown

Right. Just and I saw so much potential in this guy. I said, listen, if it were me, I would consider because, oh, we caught him at a time where he had only a couple of flips ready to go, but he had a bunch of opportunities ready to run. Right. I said, let's consider this. Let's we already had gone over what his wholesaling operation looked like, and it was sharp.

00;31;26;06 - 00;31;43;26

Unknown

He had a system down pack. He was doing really well, but he wasn't. He wasn't making the big money because he was focused on those big those big flips. Right. He really he saw that end game and I can wait. And I'm patient and I'm not I'm not a spendthrift. So I know this will work out for me.

00;31;43;28 - 00;32;14;10

Unknown

I said, well, let's just take a break from that concept and let's look at this amazing wholesale model that you've created, team that you've created, that you're supporting. Right. And let's focus on that. He literally went in three months from primarily flips using the data that we had already created, we'd already created. We saw the data and we saw what we had to do in order to put him in a position, how many wholesale deals he had to do all of this.

00;32;14;10 - 00;32;47;03

Unknown

So basically he over the that next 3 to 4 months and certainly within that first year, 100% wholesale completely stopped flipping. Okay. And that wasn't necessarily the plan in the beginning, but it became the plan. Right. And so we used our assistance and our coaching to get him to a point where every single year now he is he was ending his year, ending his year, ready to start his new year.

00;32;47;05 - 00;33;17;25

Unknown

Now at 2 or 3, sometimes even $400,000 in cash, ready to do as many deals as he wants. And we've come full circle now. Right now, we are now looking at new opportunities from which to deploy some of that cash. But he knows that his liquidity targets that we set is liquidity targets. Those cash targets are the reason that he can now have choice to do whatever deals that he wants to do.

00;33;17;27 - 00;33;41;05

Unknown

And that has been such a joy to see him do that. And, you know, he certainly has the smarts to do it. But the systems that we created, I think, were instrumental to him waking up at the end of that year and saying, oh my gosh, I have lots. I not only have cash, but I can make choice.

00;33;41;05 - 00;33;57;10

Unknown

Now I know that what I can do, he's he's he's getting tired of wholesaling. So he's now getting back into the actions that is big. But he's doing so in a controlled manner and I'm super proud of him. And.

00;33;57;13 - 00;34;22;06

Unknown

It's also this last year. This last year was very tough in his market and generally speaking, but he was able to ride out last year and even start this year reasonably healthy. It wasn't as good. It was was the last two years. But he started very, very reasonably healthy, was able to cash flow his way, never, never took any money out of his own pocket.

00;34;22;09 - 00;34;51;17

Unknown

In other words, he paid himself the exact same amount, and growing, including his profit distributions and everything. So he really he really used our system as designed to dig himself out of a hole. And that was just a super fun project. I've done others similar, but that's the one that jumped out at me. That's the one that's awesome because that shows how you've been able to transform, you know, the whole business.

00;34;51;18 - 00;35;07;03

Unknown

And I mean, not that they can't do it alone because they are super intelligent, but how you been able to walk them through all the systems of processes. And I want, you know, I want not they know clients when they lean forward and they're like, you know, whatever we need to do. Yes. You tell me to stop this.

00;35;07;03 - 00;35;26;19

Unknown

You tell me to run back over here, and you kind of create this partnership that, you know, I always say, like, I don't want to be a consultant. I don't want to be a vendor to you. I want to be a partner. I want to talk you through all this. So the fact that he dialed in, and I can see how excited you are about telling that story, because I know I feel it when we can change transform businesses like that.

00;35;26;19 - 00;35;49;17

Unknown

So I love it, I love it, I love that it's like you, you you fixed him. You know, you kind of feel like you fixed. I helped, he fixed himself. Yes, I definitely help it. Yeah. I love that story. All right. Well, so we'll wrap it up a little bit. Thank you, Michael, for being here and walking us through what you do.

00;35;49;21 - 00;36;08;27

Unknown

Simple CFO system. This is what we do every single day with every single client. It's kind of cool. You know, as you see that it's it's fun to do this. It's it's awesome to watch these transformations so mean. If you're out there now and you listen to this podcast saying, you know, if that's me, I feel like my cash is always dwindling.

00;36;08;27 - 00;36;30;00

Unknown

I can't, you know, make good decisions. Then, you know, you're not alone. As you see, this is probably fourth or fifth episode that we've done. You know, we kind of share the same stories. We see the clients come in and you guys are not alone. It's fixable. And you don't have to do it alone. So if you if this resonates with you and you want to work with the CFO, head over to CFO.

00;36;30;02 - 00;36;49;06

Unknown

Book a discovery call. Just see if it's, you know, something you want to jump into and get you. Let's see if we can get you the clarity that you deserve in your business. Thank you Michael. Appreciate you being here. And you will see everyone in the next episode. Thanks for listening to the simple CFO Case Files on the Profit First for Real Estate Investors podcast.

00;36;49;09 - 00;37;03;18

Unknown

If you found this helpful, make sure you're subscribed so you don't miss our guest interviews featuring other real estate investors and our Profit First chats with David Richter. If you're ready to bring clarity and structure to the finances in your business, visit profitrei.com to apply for a free financial discovery call with our team.