Mark Wald founded Supporting Strategies | Los Angeles in 2013 and has grown the business to 40 W2 employees working virtually across 10 states in the US. They're providing exceptional virtual finance and accounting support to hundreds of growing startups, small businesses, and nonprofits.
Mark enjoys staying busy and keeping sharp in a multitude of diverse yet related roles as a fractional CFO, serial entrepreneur, startup angel investor, startup board member & advisor, university guest lecturer, and volunteer mentor to entrepreneurs through local accelerator and incubator programs.
Today, Mark shares his secrets to growing a virtual accounting practice, attracting clients via referral networks, how he prices and scopes engagements with clients, how he recruits and maintains top talent, and the biggest challenges he has faced along his journey.
Mark started his own practice in 2014 and was building these financial and accounting systems from the ground up. The client small business would now be able to run like an enterprise. Mark hires accountants to do the recurring work for these clients. Supporting Strategies is a franchise, and they reached out to Mark to help expand on the west coast. They're very focused on bookkeeping and back-office finance work.
Mark works closely with CPAs and accounting practices, as he meets most clients through referral networks. He doesn't directly compete with these CPA firms, because their business is primarily tax and audit. He doesn't want this competing interest with referrals, so he doesn't pay or take money for referrals. Mark views this as a competing interest and could be detrimental for the client. He likes to just pay it forward and try and set people up to be in the best situation possible.
Services and Pricing
There are some business that have low budgets and they are looking to pay a low amount for a minimal package. There are rarely 'one-size-fits-all' solutions in this business, Mark likes to get intimately familiar with what's happening in the business today and where they will be heading.
"I get intimately familiar with what's happening in this business today, where are they headed, what are the pain points they're experiencing, what are the growth and new challenges they're anticipating."
When taking the business of an existing system, Matt usually likes to gain an understand of their current business and then design a package that fits within their budget. This is based on billable hours. For a new setup, the process involves much more digging and conversation about the reports and financial history. The pricing will still depend on the estimated billable hours for the time to be spent on the project.
"We can bill hourly to start and move to a flat monthly fee pricing once we have mutually understood exactly how much time it takes to do the work on a regular ongoing basis. What I don't want to do is set expectations wrong with a client where they think the price is going to be X, but we really need to do X, Y, and Z for their business."
"If we end up only doing X, and not Y and Z, at some point they're going to be disappointed. It's a losing proposition to try to shave scope and have nobody to the work, it's better to redesign the workflow and load balance."
Mark starts off with hourly fees and sets a budget cap to make sure that Supporting Strategies can actually address the true needs of the business. After getting additional time history, Mark can then move to the monthly set fee, as everyone is on the same page with price and scope. If the client isn't on board with this offering, then they may not be a good fit.
If Mark and his team identify X, Y, and Z that needs work to be in line with accounting best practices and industry standards, and the client is only interested in paying for X, then Mark has to say no.
Hiring and Teams
At Supporting Services, Mark uses a team-based approach to assigning staff to projects. He looks at work history and any relevant experience to the software or industry or the client. Seeing any matches here, Mark knows he's setting the team up for success by giving them a client in their wheelhouse.
Mark prefers to hire those with industry experience. He wants to hire top performing accounting and finance managers who are looking for work-life balance and flexibility in a virtual environment. Many of these professionals could make much more money if they went to work for the companies directly. Mark has found that many individuals enjoy the team atmosphere with other experienced industry professionals.
"We always hire ahead of demand, we hire people 1-2 months before we know we're going to need to more staff to get them trained and integrated. We spend a lot of our own overhead cross-training team members to have that flexibility."
Challenge of Extending Credit/Going Concern
Mark had some experience extending credit to clients that were not paying. To solve this, Mark has instituted the required signing of an ACH auto-debit agreement. This is software-driven payment and Supporting Strategies doesn't have to spend time with accounts payable or tracking down old payments.
Mark finds the best fit with clients generating $1MM-$10MM in annual revenue. Any lower than this number, and the company may not be ready to budget for something like $500-$2000 a month for accounting and financial services. If the business is larger, they are likely looking towards hiring full-time in-house professionals for these roles.
"If the role can be effectively outsourced in its entirety, then keep it outsourced longer. If there's so much complexity and interactivity [with the rest of the operations], then, at a certain point you get better efficiencies when you bring those team members in house... Until you get to that inflection point, outsourcing makes a ton of sense."
"There are businesses where it makes perfect sense to outsource 100% of the finance and accounting today, but as the business grows or changes, that answer changes. We actively work with our clients... to eventually training and transition responsibilities to an in-house hire... In other cases, the business might have more high-level needs... they really need a CFO or finance manager available full-time. Our team will take the lower level functions and support a high-level individual."
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