Understanding Your Numbers: The Key to Business Success with Natalia Zacharin

Brent Peterson (00:03.315)
Welcome to this episode of Uncharted Entrepreneurship sponsored by EO Minnesota. I'm with Natalia Zacharin. She is the founder of Zacharin Consulting. Natalia, go ahead, do an introduction for yourself. Tell us your day-to-day role and one of your passions in life.

Natalia (00:19.854)
Sure, so I own an accounting firm. We specialize in bookkeeping, which we can talk about is a professional service. It's not data entry. And in CFO services, fractional CFO services, so we actually work with entrepreneurs in helping them to increase their profit, increase cash in the bank, be able to scale, just understand everything through the numbers. And that is actually my passion. I'm obsessed over the business.

and where we've gotten so far. And I just love everything, numbers and patterns and being an entrepreneur has been an amazing journey.

Brent Peterson (01:00.181)
That's awesome. All right, so Natalia, before we get started, have graciously volunteered to be part of the Free Joke Project, and I have a number-based joke, so I'm gonna tell you a joke. Just tell me a rating, eight through 13. So here we go. A man loses three fingers in a work accident at the hospital. He asks the doctor, will I be able to drive with this hand? The doctor replies, maybe, but I wouldn't count on it.

Natalia (01:30.126)
I would give that a 13. Mostly because I got it.

Brent Peterson (01:32.085)
That's great. you. Yeah. All right. Good. All right. So tell us, we did, we had some talk in the green room. Tell us a little bit about your start and how you got in. mean, it sounds like you were always in accounting or in the corporate world and then you moved to being an entrepreneur. Tell us a little bit about that background.

Natalia (01:53.688)
Sure, so I was not actually in accounting. My profession is actually more of sales. I've kind of jumped around my whole life. Wherever there was a job that was available and I had some skills, I basically just did that job. So didn't really have a career plan. And about six, seven years ago, I had been working for a company in corporate in their financial department as their invoicing clerk.

and got along really well with their CFO there. And when he left, that's when things started changing for me. They made a lot of changes in their company. They bought another company and then they started getting the older population, like encouraging them to leave or giving them severance and encouraging to retire early.

I wasn't quite old enough to retire. I was 49 at the time, but I was a single mom and I saw the writing on the wall that I wasn't going anywhere. So I started looking for other jobs and I couldn't find anything. There was nothing. And I just started dating my current fiance. I just started dating him at the time, sitting in a cafe and he said, why don't you just start your own business? He ran his own business. So he said, why don't you just start your own business? And I was like doing what? And he said, well,

accounting is a good profession. So I started looking into it and I was like, okay, I think I can figure this out. QuickBooks has free classes and there's lots of YouTube videos. So I literally taught myself on YouTube and I took a course on how to start your own business and I landed my first client in January of 2019 and thought it would just be like a side gig. And now six years later, we have 12 employees.

We're probably like middle of market in size. And we actually, and I didn't even tell you this in the green room, we just made number 25 in the ink regionals for the Mid-Atlantic.

Brent Peterson (03:58.933)
Wow, that's awesome. And so you in this, is there something in you that made you want to kind of start your own thing or is it, was it just being, do feel like you're pushed out of corporate world and then you just did it and did it come naturally?

Natalia (04:15.628)
It did not come naturally at all. I felt very desperate. was actually technically on poverty levels. I was only making 40,000 for family. wasn't getting any child support. And my mom was kind of helping me where she could. I thought, well, this is not sustainable. And I kept wanting, I wanted to be self-sustaining and it really stinks to not have money. It's very hard. You don't have time. You don't have money. You can't do anything.

You can't figure out how to do things. Like I couldn't go to the doctor. If the dog got sick and it was 500 bucks, that would take me like six months to figure out how to pay that off. So it was really complicated. So I just was desperate, to be honest. And I had no idea what else I could do, but I saw that I didn't have a lot of possibilities at that time in the corporate world. And I just didn't even know what else to do. So it was just desperation.

Brent Peterson (05:08.341)
And yeah, tell us kind of your journey and how did you discover EO?

Natalia (05:17.752)
So interestingly enough, in 2023, so we were already trucking along for four years, doing quite well. We've been doubling and tripling year over year in revenue and growth. And my fiance said he applied for EO, that he finally made it, and it's always been his dream for the longest time. And I was like, EO, what's EO?

So I started looking into it and I really, I truly believe that part of my success has been surrounding myself with other business owners and in masterminds within my own field and in other, just other businesses where it normalizes growth, it normalizes leadership, it normalizes challenge, and it normalizes big numbers of success. And so...

When I learned about EO, I got really excited and I thought, I want to do that too. And of course they have a minimum to get into EO. You can get into EOA, but they have a minimum for EO. And I actually, when I started talking to them and I went to the first happy hour at the end of 2023, by the time I joined EO, I actually made it over that hump and I joined EO directly, which was a lot of fun. And it's been great.

Brent Peterson (06:39.509)
Yeah, that's great. So tell us, you had said that you're very much numbers oriented. How do you think that helps you to help other entrepreneurs grow and build successful businesses?

Natalia (06:57.826)
I think the number one thing is to really understand your financials, right? A lot of people come to us and they have never looked at their financials. They have some CPA or a bookkeeper in a CPA office working on their financials, maybe at the end of the year. They never receive reports. No one ever reviews the reports with them. So they're kind of flying blind and they fly blind by saying, I have cash in the bank, so I must be doing okay.

There's a lot of people that do that. There are people also that do have all of those systems in place and do look at their numbers, but don't understand how to interpret what they see to make changes to where they want to be. And so we kind of bridged that gap where we have, we make sure that everything is timely and accurate first. That's the foundation. And then we bridge the gap of, start looking at

how to improve your situation. So for me, everything is based on numbers. So for instance, if you need to hire someone and you don't have enough money, but you're working super hard, that could be several tweaks, but that might be an issue with sales or revenue or not pricing high enough. So like everything answers numbers. I used to look at...

Revenue for instance and be like I need to close a client a week. So every week I'm like I have to talk to ten people at least yeah, you know and Especially if it's like a 20 % close rate needs to be a minimum of five people getting them on a call So it means I have to reach out to about a hundred people because maybe Ten to twenty will actually get on a call with me and I'll close like one or two So I would look every single Monday be like what do I have booked?

I don't even do my own sales anymore, but this is what I was doing in the beginning. Now I do it with my sales team. But what's been booked for the week by Wednesday, what have we closed, what's left over? And if you're not on target, you need to reach out to more people. Everything is about numbers for me.

Brent Peterson (09:05.075)
Yeah. And so do you encourage entrepreneurs to do entrepreneur operating system EOS, things like that to get them sort of in place or do you just really focus on the financial side and

Natalia (09:17.39)
Yeah, we really focus on the financial side, not on operations as much. So we focus on here's if you want to get to, so here you are today. CFO services are always about the future and the trend. Bookkeeping is really more historical. CFO is forward looking. So, you know, here we are in April. And if you want to grow by a million dollars before the end of the year, what does that look like in terms of every single month?

You could even break it down even further, but every single month, like what does that look like? Where do you need to be? And then you backtrack it. what does your marketing need to look like? Where, how many prospects do you need to talk to? How can you make the revenue more predictable, the marketing more predictable, the pipeline? And then after that, what else is affected? So how many people do you need to hire? Who are they in what position?

What does your profitability need to look like? How does that get impacted? And also how much cash do you need in the bank? So everything is driven by the top line and then it answers all of the other questions because they're all like little levers, right? I see it almost like I got a huge dashboard in an airplane is what it seems like to me. Like we just tweak this up and tweak this a little bit down and that's kind of what we do in the forecast. And then we meet every single month.

and we talk about the variance and what actually happened compared to the forecast. And that gives you an opportunity to micro correct. So that's what we really focus on is really are very numbers driven. We're not coaches or mastermind specialists or operations, just strictly numbers.

Brent Peterson (10:57.941)
How many times do you hear the entrepreneur say, you know, I look at my QuickBooks every day, I know of Money in the Bank, only just have them come back a couple weeks later and say, why am I out of cash? What do do?

Natalia (11:09.548)
Yeah, all the time. Or the good news is when they work with us, especially on a monthly basis, they tend to ask more questions. I had a client once that received a windfall. they're in real estate. Real estate is very up and down. It's feast or famine, or at least it can be. And so they received, they got, they closed like two or three houses in the span of one month and they got all of this cash. And they're like, woohoo, we want to pay off.

all of our credit cards and this loan that we owe, we want to pay everything off. I was like, wait, hold on. Let's not spend all of the cash. Let's project out how much you need for the next couple of months, because it might be a few months until you close something again that looks like this. Let's just slowly pay things off. So it's just a matter of looking at things. But we have that all the time where people get a huge influx of cash. And then in two days, it's completely gone because they paid everything off and without taking any consideration.

what else they need for the next few weeks or months.

Brent Peterson (12:11.069)
so that makes me think about when somebody sells their business to, get a big windfall and then suddenly they don't have an income anymore either. Right. Do you help entrepreneurs? mean, I guess the first part is having a good accounting system or setup gets you ready to sell. But after you do sell, there's the next step of knowing that suddenly you just have a big windfall of cash, but no income. Right.

Natalia (12:34.766)
budget, I would budget of like how much do you need for the year? What do you want to do? How much do you need for like daily things? How much do need for fun? What does that look like? And for how many years? And I would over budget.

like an additional maybe 10 years, maybe even longer for your lifespan. So I would budget at least till like you're a hundred years old to be honest, because you don't know how much you're actually gonna need. And we don't, none of us really know with everything that's happening, we could live much longer. By the time I'm 90, it may be normal to live to 120, you know? So, and you never know. So I would, I think a budget is really, really important. And when I didn't have any money,

I was left in a tremendous amount of debt by my ex-husband and I didn't have any money. I had to get myself out of debt with a very, very meager wage. So I budgeted everything and I saw that I was overspending by like, I think it was $8,000 a month at first because I was used to having a dual income family. And then I cut back on a ton of stuff and then I saw I still was overspending.

So I had to cut back, I went as far back as cutting off. I wasn't allowed to buy liquid soap. I was using like all the leftover soap that I had from all those hotels that you go visit, you know? And no coffee, tea, no fabric softener. That's really extreme, but you have to live within your budget. There's just, you either have to make more money or live within your budget. That's the only way there is.

Brent Peterson (14:10.427)
yeah, I mean, that kind of leads me to my next question. A lot of entrepreneurs don't budget. Like I just think about marketing department and they, you know, maybe somebody will say, what's my budget? Like a new marketing person would come in. What's my budget? we don't have a budget. Just do what you need to do. And then suddenly the marketing person spends too much and maybe the owner is upset because they've spent too much, but there's no budget. So do you have a way of recommending or coaching?

entrepreneurs into being able to do that.

Natalia (14:41.165)
What?

There are certain percentages that work well, but the caveat is you have to make sure it's working. So you really want to delineate in your profit and loss statements so you can see it really well. So for instance, if you decide that you're going to do spending on advertising, online advertising, I would actually pull that out so you could see it really well on the profit and loss and look at it so you can see.

If I spend more here, how does it impact the top line higher up? So you can really keep a really close eye. The golden rule is about 10 to 12 % of gross revenue. Now, if you have a product, you may want to consider 10 to 12 % of gross profit, because if your cost of goods sold is really high, that's really what you're working with.

And even that's a little high, I would start maybe lower and ramp it up. But the main thing is you want to make sure it's working. Because if it's working, you can increase it if it's working, right? Because then you keep making more money. If it's not working, that's a different story. So you want to make sure from your marketing department or whoever you're hiring, how many leads are we getting? Not clicks. How many leads are we getting? How many are converting into sales calls? And then how many are actually converting into customers?

And how much are we spending so you can get like a client acquisition cost, a lead cost, cost per lead. So you want to get all these different measurements and metrics to make sure that it's working and keep checking on that and keep asking questions.

Brent Peterson (16:24.851)
Yeah, so I'm hearing the same thing over again. Keep asking questions and how do you encourage your clients to ask you as an accountant questions? think it's, you think some people don't know where to start?

Natalia (16:36.622)
They don't know where to start. think, so when we were just working on the bookkeeping, we don't really meet with them every single month, because that's just more of a compliance service. And we do offer that as well. But when we have the Chief Financial Officer service, the CFO service, we start to really talk through things. I ask a lot of questions. I know a lot of our CFOs, we start asking the questions, like, what's going on here? This doesn't make sense. This number.

So for instance, I had a client who told me that their sales manager was making all these sales managers making this very high salary. And then they were not closing in new clients over and over again. Every month we'd meet no new clients, no new clients. And I'm like, well, so what's going on? How many people is he talking to? How many is he reaching out to? So we started like really digging in asking questions. I started asking the questions first and then

the owner started asking the manager questions and lo and behold, it took like two months. Finally, the sales manager, because the questions started getting asked. At first he was, he kept, sticking to his story that, he's making all these calls. He's reaching out all these cold calls. And then he fessed up two months later because he kept asking because I kept prodding. And he said, you know what? I'm actually not making any of these calls. I'm just putting that into the system. And I was like, well,

Well, now that's an integrity issue, not just as he wastes too many, basically stealing from him. And that's a culture issue. now the next conversation is we need to get rid of him because he can't stay. And so like the questions start with the numbers for me, and then we start asking the questions, which forces the owner to start asking more questions.

Brent Peterson (18:06.013)
Yeah.

Brent Peterson (18:25.653)
Yeah, that's great. Natalia, we are quickly running out of time here and this has been super interesting. Before we do end though, I gave everybody a chance to do a shameless plug about anything they like. What would you like to plug today?

Natalia (18:40.974)
So I actually have a page dedicated to this podcast specifically for your listeners. You can find it under zachranconsulting.com slash UE for uncharted entrepreneurship. So zachranconsulting.com slash UE. And on there, we actually have a couple of freebies. have seven ways to find money in our business now.

and then a checklist for financially successful business. And then there's also a link if you wanted to schedule a call and do a financial consultation with us for free, there's a link there too.

Brent Peterson (19:20.127)
That's great, and you work with anybody in the US.

Natalia (19:22.882)
I work with anybody in the US, yes.

Brent Peterson (19:25.877)
Perfect. All right, and how can people get in touch with you?

Natalia (19:30.254)
That's probably the best way, zachronconsulting.com slash UE because we have our link there as well. that's, if you scroll, it is connected to my website as well. So, and we're on LinkedIn and Facebook and all the places, Instagram as well.

Brent Peterson (19:36.863)
Perfect.

Brent Peterson (19:49.545)
That's great. Natalia Zakarin, thank you. Thank you so much for being here today. It's been such a great conversation.

Natalia (19:57.08)
Thank you so much for having me. It was a lot of fun. It was really nice to meet you.

Brent Peterson (20:01.077)
Mm-hmm.