Lessons learned as a business owner – and as a banker
Doug Case, Well Fargo's Small Business Segment Manager has worn multiple hats in his career. He shares his insight on owning a small business prior to becoming a banker.
Long before I became a banker, I had the good fortune to be a small business owner: one of three partners in a small San Francisco marketing firm. It was a lot of fun, but the agency environment was a tough school for a manager— famously fast-moving, relentlessly competitive, and complicated by a shifting roster of clients and campaigns. I've never worked so hard in my life. I'll also never forget the day my name was added to the sign on our front door.
From where I sit now as manager of Wells Fargo's Small Business Segment, those experiences on the roller coaster of business ownership are still vivid. I continue to be amazed by the character of those who choose to own and run a business. I'm grateful that many of them are Wells Fargo customers, and I like to think that having been a business owner myself helps me do a better job serving them — through empathy and respect, and important lessons I learned.
Any need, any time
As a business owner, I saw how quickly the needs of our business changed. This first-hand experience showed me the importance of having a bank that offers the business a wide range of products to meet a wide range of financial needs. Small companies are incredibly diverse to begin with, regardless of what stage of the business lifecycle they've reached. They are especially sensitive to changing business environments and competitive shifts. When their needs change, often very rapidly, a bank should be able to quickly meet them.
A bank also needs to do more than just offer a catalog of options. Most business owners I know are pressed for time, and researching financial products often isn't a top priority. When I owned my business, I remember when our bankers at a nearby Wells Fargo store offered to open a line of credit to help with short-term cash flow fluctuations. I still recall how much we appreciated their suggestion at that time for helping us understand what we needed.
Today I believe that providing financial guidance is at the core of a banker's job. I'm proud to say that hiring and developing bankers who can support small businesses is an important part of the culture at Wells Fargo. Most of the guidance a good banker gives pertains to the financial side of the business, but many aspects of business ownership blur the line between finances and management effectiveness. With this in mind, I'd like to share a few broader insights and observations from my experience as a business owner and banker.
Don't go at it alone
Wearing a lot of "hats," from strategy to bookkeeping to HR, was something my business partners and I did every day. Most small business owners can probably relate to this. For many business owners, doing a lot of things well is more than just a practical necessity. It's a real point of pride that's part of the very spirit of business ownership. But at some point it simply doesn't make sense to do everything yourself.
Hiring someone to handle tasks you routinely do yourself (and might even enjoy) can seem like a big deal at the time you make the decision. Yet if your finances allow you to give up some of the back office responsibilities, you gain precious time to focus on your passion, the work that got you into business in the first place. And with the wealth of outsourcing options that our networking culture has helped create, it's easier than ever to spin off non-core activities and focus on your "real" job.
Keep your head up
When I ran a business we felt like we were living on the edge every day, even when we were doing well. The effort it took to step out of the moment, look six or 12 months down the road, and make a strategic decision was a challenge, to say the least.
Someone once said to me, "Your business isn't all about you." That was a turning point! I discovered the importance of seeking wisdom from the wider world. This can mean taking time to network with peers, study your competition, develop a new skill, or simply read a book. When my partners and I took a deep breath and looked around us, we started to think about national opportunities and joint ventures for our business, and some of these proved very successful.
Separate your money
Establishing dedicated business accounts often is one of the first steps in starting a business. However, long after setting up separate accounts, many business owners may still find themselves using personal resources to make payroll or fund big purchases, or putting up personal real estate as collateral for a business loan. I've heard countless people who are sole business owners say that when it comes to finances, it's sometimes not even clear what money belongs where.
There are many ways to structure business finances effectively, but it's generally a good idea to separate your business and personal accounts as completely as you can. The bookkeeping and tax implications are reason enough. And the satisfaction of knowing that the business can truly stand on its own might be the best reason of all. Please contact your own legal, tax, or financial advisors regarding your specific business needs.
Know when to grow
At Wells Fargo we often talk about growth stages in the business lifecycle. Similarly, there are stages in the personal growth of the owner — from the creativity and intensity of launching a startup, to the wisdom and perspective of being a survivor, or becoming an industry veteran. That sense of security means your company has reached a stage of maturity.
As a business owner I experienced this evolution myself. As a banker, I try to remain close to that experience. The business environment today presents challenges unlike the ones that confronted me as a business owner. Yet, thankfully, the resiliency and indomitable spirit of business ownership is still alive and well. I have a great admiration for all small business owners and their contributions to America's economy. To all business owners, I say, "Thank you." May you find new successes and rewards in your journey!
Doug Case is Senior Vice President and Small Business Segment Manager at Wells Fargo.