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Video review for Front End only
Text From This video
Profitbook OTO Hey, John Sonmez from Simpleprogrammer.com here, so I’ve got another book review for you today. I have gotten back into my old reading habits, so the number of book reviews coming out on this channel should be increasing. Now we’ll see what happens I may I may change that in the future depending on and what it said to do. But right now, I’m in that reading mood and I’m doing some longer runs.
So I’m doing more audiobooks, plus I’m reading a lot more. However, I’m considering doing some more Renaissance reading by reading some older material rather than the newer business books.So you know, if you’ve got some ideas too, and by the way, if you ever have a suggestion for books to read for me that you think I might like, you know, leave a comment. You can always email me at John at simpleprogrammer.com.
I always appreciate that as well. I like to get recommendations so that I can produce, so I can actually read the best books and then produce some of the videos that you guys like about the books that you’re interested in. So the book that I’m going to be talkingProfitBook OTO about today is called profit first and that’s by Michael. I believe his last name is Michael Wits or Mike Alouettes. Let me take a look here, Mike Calloway,—, tz—, I believe, or Z whatever.
So it looks like a Polish name to me, so you can click there and check that out. By the way, if you’re unfamiliar with how this works, it’s kind of weird with YouTube. You’ve got to click the little eye up here and you’ll get the card and it comes down and click there. You want to be familiar with that, if you’re new to the channel, because I do this all the time, clicking pointing this stuff. The links are always in the description below. This book was a highly recommended book and I can see why it’s a book that I was a little bit sceptical of, but obviously I followed the principles and it’s essentially a book about running your business. So if you’re a business owner or you’re thinking about getting into a business, you should probably read this book. What it’s about is it’s about changing the way that you do accounting. Instead of GAAP accounting, the generally accepted accounting principles, you should instead build a system where, from the very beginning, you are taking profit from the business and building things around the idea of taking profit out of the business.
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Now this seems like snake oil at first blush. I’ll admit it, but it’s actually very sound. It makes a lot of sense. The whole thing could basically be said to rely on Parkinson’s law, which basically says that the work will fill to whatever the time for that work is, and so the same thing happens with money as far as budgets go, so you will spend the money that you have essentially the biggest problem. A lot of businesses have a lot of business owners. Are they making some revenue? They take the sales, minus the expenses, and then they take the rest as profit, but they feel like they need to grow and they need to grow fast.
So what they end up doing is they actually end up making more money and then spending more money and not having anything left over. So the idea here would be that what you’re going to do is you’re going to make your money and then you’re going to subtract out the profit ahead of time. What you’ve deemed is the profit that you want to be able to pull from the business based on the percentage, which makes a lot of sense, and then what you’re going to be left over with essentially is going to be your expenses or what you can spend And so that’s going to cause you to rein in your expenses, be creative, and figure out how you can be profitable and still be in business, so you’re going to have to figure out some stuff right. This is the same thing and again, Parkinson’s. All you’re going to have to figure out is how to do it here.
So I think this is really ProfitBook OTO valuable, because a lot of business owners don’t get this shit. This was not as valuable for me because ever since I’ve been running a simple programmer, I’ve been running it highly, highly profitable. I never, you know, simple programmer started out as a little bit of extra money I made for my blog, so the whole idea was, let’s make some extra money, and then, as it’s grown and I’ve brought on employees and a business partner, we’re now doing, you know, we did.I think we did a record revenue of like sixty-five thousand dollars last month, but you know, on average, men were doing like 250k in revenue. At least half of that is really turning into profit for the most part, and we’re paying ourselves salaries and doing all this, so we’re doing things right.
So when I read this book, I thought, “OK, big-big.”You know Pat oProfitBook OTO n, the guy who backed John up on this, but the principles behind it make a lot of sense.So there are very few things that I would disagree with the author of this book on. You know, one of the things that he said that I almost disagreed with, but then he, but then I’m like yeah, and now I actually agree with. He said that too many people preach paying down debt too aggressively and that you’ve got to give yourself some reward as well, and then when he said that, I was like okay, I’m gon na rip this to shreds. But then he said, like you know, it’s take you because he advocates basically taking out profit and putting it in different bank accounts, and I won’t give you the whole system here because.
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This isn’t meant to be like a summary book. It’s just my my thoughts on it, but essentially what he talked about was, you know, take your profit account and take ninety-nine percent of it and put that towards paying the bills, paying down your debt, and then take one percent out and celebrate with that-and I thought, okay-that’s pretty fuckin reasonable right, I can get behind that right, and that that’s cool, so that makes a lot of sense. So a lot of ways said: you know, just the principles behind this make a lot of sense from a business point of view, and you know, you might think again that this is snake oil, but no, you’ve got to have like a profitable business. If you’re not profitable, you’re not going to grow, and a lot of people just grow for the sake of growing. He makes a good example, and there he talks about Twitter and how ridiculous it is to get users and to grow, grow, grow and become this monster and not figure out how to actually make money. That’s just plain stupid.
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I don’t. I don’t like that. So with that whole start-up mentality, you should be profitable for me because it’s from the beginning, so again, so with a simple programmer. This is what we’ve done. You know, it doesn’t mean that we’re making all the profit from the company, but we’re growing at a pace and everything that I’ve kind of decided was simple programming, like when I decide to hire someone or to make an expense, it’s always based on that.
Can I actually make money off of this? I never, you know, just think. Okay, I’m investing for growth, and that hasn’t even crossed my mind. In fact, for the longest time when I was running simple programmer solo, I think it was doing around a thousand dollars a month or so, and I was basically just taking all of that money out as expenses.I was making like a thousand dollars a month and it was like, you know, eleven thousand dollars in profit and I’m just taking it all out because I was like, and then I actually started thinking. Well, maybe I should reinvest in the company in some way, because that was my original mindset, so I think the book is good.
I think it’s got a really good formula. I think, too, that you should the way of managing your accounting and managing your business, and I’d recommend it to most people. You know, definitely read the book. You can check out the link here again, that’s in the description, and you know, if you’re new to business, you’re starting with this problem, like just implement it to the tee. You know, for simple programmers, we’re probably not going to jump on this, so throw some ideas out there.
I’m going to take from this because I feel like we’re already doing a lot of things well and maybe even better than some of them, because we have our own customised system for the way we’re doing accounting based on what I want to know about. Where is the money coming from for things like that? But that doesn’t mean there’s not any room for improvement. I’m not going to take anything from this book, but I think a lot of people would just benefit from implementing the system. It makes a lot of sense, really. It really can change.
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It changed the gaming era. This is like a game-changing book, I think, for a lot of businesses, just like one of the ones. I recommend all the time which he mentions in this book. The mythical are the e-myth revisited by Michael Gerber, really really good book as well use like a foundational if you’re starting a business, I should do. What I should do is a video on the bit of business books like you’re starting.
A business must read business books that I’d recommend. I know, leave a comment if you want me to do that. I still owe you guys, like a man book. I know that I’m going to do that sometimes here. Maybe I’ll actually record it today. Maybe I’ll just do that because that’ll be fine. Alright, so that’s all I got for you today if you haven’t subscribed already to this channel.
Okay, just do me a favour. It’ll take youProfitBook OTO, just a second to click. Then subscribe below. You can always unsubscribe. If you don’t like it, click the bell to make sure you don’t miss any videos. I’ll talk to you next time. Figure
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