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Summary of Profit First
Short summary
Do you regularly sit and wonder why you started a business? You thought it would be a fantastic route toward freedom and finances, but it’s turned into a stressful monster, absorbing all your time and energy, bleeding you dry. Your business has turned on you, and it’s time to take back control! “Profit First” will revolutionize how you run your business, giving you instant profit and a brighter financial future.
Mike Michalowicz is the man to listen to. Author of 7 best-selling business books, experienced entrepreneur, and highly regarded lecturer, Michaelowcz has been there, done it, and got the t-shirt to prove it. From finding money where you thought there was none to arranging your bank accounts in a more logical order, “Profit First” is the first step towards business fulfillment!
“Profit is not an event. It’s a habit.” ~ Mike Michalowicz
15 min
10 key points
12 insights
Table of content
- Summary of Profit First
- About the author
- What is Profit First about?
- Who should read Profit First
- Topics in Profit First
first key point
Your business is a monster, consuming your cash
Listen the first key point
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Most people start a business with grand dreams of becoming millionaires and a desire to be their own boss, and not answer to anyone else. They want to grow that business over a relatively short amount of time. That’s the dream, but the reality is often far different.
Most entrepreneurs put growth before profits; this means they’re constantly chasing their tails, becoming stressed, and never really seeing any gain. We believe that if we work a little harder, we’ll achieve more growth, more money, but it never works that way.
Half of all businesses fall into failure within the first five years of being established — that’s a considerable amount, enough to put you off starting your own business! The businesses that do survive are often struggling to stay afloat, fighting debt constantly. If this is your business, it has turned into a monster; it is eating your cash, causing you to become stressed, sucking the life right out of you.
Most entrepreneurs put growth before profits; this means they’re constantly chasing their tails, becoming stressed, and never really seeing any gain. We believe that if we work a little harder, we’ll achieve more growth, more money, but it never works that way.
Half of all businesses fall into failure within the first five years of being established — that’s a considerable amount, enough to put you off starting your own business! The businesses that do survive are often struggling to stay afloat, fighting debt constantly. If this is your business, it has turned into a monster; it is eating your cash, causing you to become stressed, sucking the life right out of you.
Putting profit before growth is a huge mistake. Focus on growing your business first.
Mike Michalowicz tells a rather remarkable story about his financial wake–up call. He successfully sold a computer forensic science investigation business and earned big money as a result. He spent it all within the first two years through lousy spending decisions and poor investments. He then received his tax bill and panicked because he didn’t have enough left to pay it. He finally told his family, ashamed of himself and the position he was in. His 9–year–old daughter came into the room with her piggy bank and offered her savings. At that moment, Mike Michalowicz learned the actual value of money, and “Profit First” was born!
Did you know? Mike Michalowicz now has a net worth of over $1 million.
Did you know? Mike Michalowicz now has a net worth of over $1 million.
second key point
There is plenty of time to focus on what comes next; think about profits to get you off the ground
Most business owners focus on growth before profits because we’re told that entrepreneurship is about successful growth first and foremost. That’s not the case. We cannot do anything without money, and a business needs capital to grow in the first place. Mike Michalowicz identified his own mistake; he understood how to develop a business and to do it fast, but he had no idea how to make it profitable.
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third key point
Accounting and entrepreneurship are two different things
fourth key point
Apply Profit First’s four main points in your business to increase the chances of success
fifth key point
To cover your business needs, set up different accounts for different purposes
sixth key point
Understand allocation percentages to aim toward success
seventh key point
Profit First works when you put it into practice, but planning is vital
eighth key point
Waving goodbye to debt will set you free from money barriers
ninth key point
Your business contains more cash than you know; you simply need to find it
tenth key point
Conclusion
What is Profit First about?
Who should read Profit First
Topics in Profit First
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