Rich, Fit and Happy Show

60 | The Financial Matrix Unleashed: Kristen Hillman Unveils Virtual CFO Strategies for Unleashing Business Financial Success

• Crystal O'Connor • Season 2 • Episode 60

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Are you ready to skyrocket your financial success as a woman entrepreneur? 

Join us as we welcome virtual CFO Kristen Hillman, founder of Vitacula, to share her 25+ years of accounting and finance expertise. Together, we'll uncover the essential components of a financial strategy that goes beyond business, and how understanding your financial data can fuel better decisions, maximize profitability, and foster long-term sustainability.

Listen in as Kristen highlights the importance of defining your personal financial freedom and crafting a tailored strategy to support your unique goals and dreams. Discover the critical role mindset plays in achieving financial success, and learn the three transformative mindset shifts seven-figure clients must make to hit that coveted million-dollar mark. You won't want to miss this valuable insight into building wealth and creating a business strategy that aligns with your values and aspirations.

 With this episode, you'll be well-equipped to tackle your financial goals, understand your money mindset, and leverage the support of your community to elevate your entrepreneurial journey. So sit back, relax, and prepare for a wealth of knowledge!

Find more about her here:

Sign up with Ageless Ambition by visiting https://www.AgelessAmbition.com

You can also schedule a call with me or one of my team members at https://www.calendly.com/wealthy-wellness

Health and Wellness practitioners: you can learn more at http://www.WealthyWellnessAcademy.com

Speaker 1:

I believe that to really amplify your personal goals for your business, your mindset in terms of finances needs to be a combination of two things. One, learning and understanding your mindset on money.

Speaker 1:

Money mindset, in my opinion, is not good or bad. It is a mindset, it is a state of your mind. We need to know where you're sitting with it And that's where the journaling comes into play Sitting back, looking at your history. What did your family teach you about money? What are your tendencies? Are you an impulse buyer? Are you a saver? Really understanding where you sit. But then we take it a next step. If we are here building a business, there should be a goal, a financial goal that needs to be there And, in my opinion, it needs to be more about defining what is financial freedom for you individually.

Speaker 2:

Welcome to the Rich Fitten Happy podcast. I'm Crystal O'Connor, where we want to take you from drab to fab in this beautiful life. Let's go, hello, hello. Welcome to Rich Fitten Happy. I'm Crystal O'Connor, your host, and today we're going to talk about money in a little bit of a different way because, well, we're going to talk about, instead of just your business, your financials within your business, why it's important and why women tend to avoid it. So I have an expert today your virtual CFO, kristen Hillman. Welcome, kristen. Thank you, crystal, for having me. Yeah, this is going to be a great conversation And it's a much needed conversation, isn't it? So let me just like share a little bit here. I'm going to put my glasses on.

Speaker 2:

What is your background for everybody listening? She's the founder and CEO of Vitacula. It's a boutique financial strategy and virtual CFO firm that helps service-based businesses accelerate their dreams through her signature financial simplicity framework. She's got 25 plus years of experience in accounting and finance and leading private equity companies to success, and now she helps value driven. I like how that's stated. She helps value driven small businesses to maximize their profitability and sustainability. Kristen, what is the difference between your business strategy versus financial strategy?

Speaker 1:

That is, such a good question because most people don't realize there is a difference. They think their business strategy is all that they need And the business strategy should be your long-term goals of what you're wanting to build And there are usually specific steps to attempt. All of us, as entrepreneurs, need to be pivoting from time to time. The financial strategy is the foundation under the business strategy And it is the piece of step by step that can get you to actually achieve and amplify that business strategy. You can talk about your dreams of certain lines of business. Different revenue sources strategize what you want your business and your life to look like in five to 10 years, but the financial strategy is actually the step by steps and the metrics to figure out how to get there.

Speaker 2:

Okay, so are they connected to marketing and sales or not?

Speaker 1:

Well, your financial strategy is going to include your sales. It's going to include marketing making sure your marketing costs is appropriate based on the conversions that are happening. All of that comes into play when you start to pull financial metrics, Because at the end of the day, we are here to run a profitable business. If you are saying, oh, I just want to help people and love on people, that's a hobby And it's okay to start there. But if you are looking for a long-term business profit and there is nothing to be ashamed about desiring profit, So all of those financial numbers are going to help you support that business strategy, know which direction to go, maybe where to stop spending, where could you spend a little bit more to build that business strategy that you have?

Speaker 2:

Okay, so it sounds like you put a magnifying glass on the numbers so that the math is mapping and your P and L, your profit and loss statement, shows that you're in the profit Right, you know finance strategy is actually looking for historical information from your bookkeeper, from your CFO, is our starting place.

Speaker 1:

It's really important to know where you are and what you're spending and what you're making. And then we shift our vision forward and you use that information to start to strategize and forecast on what the future is going to look like. You make plans And, as we all know, sometimes, a lot of times, the plans don't work out as we think. maybe certain offerings don't sell, or something. They don't happen fast enough.

Speaker 1:

If you have financial data, you're probably going to find out faster which ones are worth your time and which ones maybe you need to retire and move from.

Speaker 2:

Okay, yeah, and so one of the things about women is that we are driven, they say, by emotions maybe some more than others and less logic. Now, in some ways it's really powerful and it's kind of our superpower, and in some ways it's not and it hurts our bottom line, right? So can you expand on that? Because sometimes emotions and stress and estrogen and lack of estrogen can make us avoid things that cause so much stress And we can only handle so much. So it's just reminding me of a conversation I had with a couple of experts about estrogen, and when our estrogen drops we actually feel a little frazzled, wired and tired, and I can see how easily it would be to avoid this altogether when it causes a certain kind of stress. So I said a lot right there. I will let you take it from there. Well, you know we in particular.

Speaker 1:

What we do is primarily financial support for female entrepreneurs And several years ago when I started the business, I was finding very quickly that each female entrepreneur had such a difference starting place mentally, with money and looking at numbers, And there was no correlation to maybe how long the business had been going, how profitable the business was. Everybody's stance was very unique. I have not started with a client ever. That was in an amazing mindset. They're just all different. So we started doing some research and really digging into women and how we feel about money and why that is. I found that women sit at a crossroads. We are taught that money represents purchasing power. Right, We love to buy beautiful things.

Speaker 2:

I mean the stats are crazy with what we I mean women spend 80% of the money in revenue Right In the economy. I should say I don't know exactly how that was stated so I botched that but we make 80% of the purchases.

Speaker 1:

At the same time, we're also taught that money provides security, and so there is a conflict, and I see it as a crossroads, and each of us, based on our history and our parents and what was going on in the world when we were developing, you know, and earning money for the first time, we sit at different places on that crossroads, but I have never met a woman that doesn't sit on it somewhere. I sit on it and I'm certain that you, crystal, sit on it somewhere and understanding where you are in that crossroads, it's not about fixing it, it's just being aware. Okay, i am fearful of debt. I have a client that is so fearful of debt. She's approaching seven figures in her business. She pays off her credit card every single week because she's so scared of it, and she has no reason to be fearful of it, and that's a piece of what I'm trying to help her is give her the confidence to step away from that fear.

Speaker 2:

Okay, confidence, right there, that's like a key word. So what about somebody that is the opposite, where they are confident in that they can take bigger risks, so they can tolerate bigger risks, but then they start to avoid looking at the problem that it may have created, like taking on too much debt. So what is too much debt and what's not enough?

Speaker 1:

Well, that's a really good question.

Speaker 1:

The way that we look, the financial simplicity method that I've created was specifically for female entrepreneurs, and we simplify the profit and loss and the forecast method and class into just the major areas of the business.

Speaker 1:

So when you say what's an appropriate amount to come into, it really needs to be broken out to what's appropriate to spend for marketing, what's appropriate to spend for admin and support, what's appropriate to spend on investing in your business And being able to kind of see here's my revenues, this is my profit available to spend on running the business, and each of those areas have appropriate amounts that put you in a healthy place, and I have a client that loves to invest in her business, loves to. There are times I have to, yeah, but I love it, and those are some of my favorite clients because they are always looking for learning and wanting to see. You know how can I improve myself, how can I improve what I'm delivering to my clients? But if you invest too much, you could be putting your cash flow at risk and being in a position where you can't actually pay your employees And for sure not pay yourself, which is a common problem that I see with female entrepreneurs. They don't pay themselves.

Speaker 2:

And maybe calling things an investment, when they're really investment For sure. So I don't know if we could give some examples. Can you give some examples on some of the things that you see women that like to invest in their business? What are they spending money on investment-wise in their business when they probably shouldn't, or that starts to affect that profit and loss?

Speaker 1:

Well, we give a general range of up to 10% of your gross profits, which I don't want to get into the details of accounting terminology, but what's available after you have produced either the product or the service. I feel comfortable with my clients spending up to 10% of that, investing in themselves. Most often that's in forms of continuing education. Health and wellness coaches love to continue to invest and learn more to be able to serve their clients better. Yeah, masterminds, business coaches, those are good investments. The whole goal is to expand you as a person and expand the breadth and the opportunity that your business can serve others.

Speaker 1:

I feel comfortable up to 10% for my clients when you start spending over that And we always look at it in a long-term perspective, not on a month-to-month basis, because most people's It might look different. Flock's weight For sure. For sure, my health and wellness coaches, they have seasons of super high sales and they have seasons of lower sales, and so we always want to look at this long-term And nothing's black and white. It's always about you and your personal values. But I feel comfortable up to 10%. Some clients can spend up to 15. But we're getting into the detailed nuances of accounting and finance. But that's a piece of your financial strategy. If you have this business strategy of wanting to maybe transition your business where you're providing services each month to maybe moving into a coaching space that's pretty common Can I invest to educate myself on that shift And how much should I be investing to be ready to make that shift when I want to?

Speaker 2:

Okay, so let me shift just a little bit here. I know that I teach in Rich, fit and Happy. It's a program that I have. I teach journaling a little bit so that you change the neurology of your brain, like, help you focus and really know what you're going after, because it's important to know what your goal is going into business each month, reflecting on it, and so I have them do writing and visualizing. Tell me, though, how that's not nearly enough.

Speaker 1:

Oh, it's not, but it's an important piece. Yeah for sure, it's really starting Right. I believe that to really amplify your personal goals for your business, your mindset in terms of finances needs to be a combination of two things One, learning and understanding your mindset on money. Money mindset, in my opinion, is not good or bad. It is a mindset, it is a state of your mind. We need to know where you're sitting with it, and that's where the journaling comes into play Sitting back, looking at your history.

Speaker 1:

What did your family teach you about money? What are your tendencies? Are you an impulse buyer? Are you a saver? Really understanding where you sit, and that's where journaling comes into play. But then we take it a next step. If we are here building a business, there should be a goal, a financial goal. That needs to be there And in my opinion, it needs to be more about defining what is financial freedom for you individually, not looking at all the revenue numbers thrown off on social media that people are using for sales. What matters to you and what can allow you to take over a decision that money is making for you right now. That, to me, represents freedom, financial freedom. So you've got to understand your mindset, you've got to do the journaling, but then you shift it and apply that knowledge where you are right now and where you want to go and start building your financial strategy with that in mind. So it's a two-part process and journaling is so important, but it's step one.

Speaker 2:

So a two-part process. So part of it was learning, and then what was the other It's?

Speaker 1:

actually taking that learning and starting to build your financial strategy to achieve what you see as freedom. What is financial freedom? And you build that strategy For some? I have a client. her financial freedom is to employ as many other women as possible. To her, if she is in a position where she can pay her bills, she wants to employ as many other women as she possibly can. What is freedom to her? For me personally, my husband owns his own business as well, so we collaborate together on our finances. But for me, financial freedom is I can support our family, if I need to, all by myself. So when my business is in a place where I can support my family, I am in financial freedom at that time, and that allows us so much flexibility on our business when we're no longer sitting with fear.

Speaker 2:

And some women or people in general, their idea of it is working when they want to, and that could be different with the hours. So I know that with me flexibility in my hours it was crucial and important. In fact, it was why I started my business, because I had three kids and newly divorced, and so it was really important. And one of the things I noticed while working for corporate is the constant feeling like I was putting my corporate job in front of my kids and I did not like that at all. So that was driving me to start my business and it drove me to stay in it, and then, when the money started coming in, i realized I'm unemployable now because nothing was better than that for me. So, yeah, so freedom is a big deal, and it comes in many different varieties, doesn't it? It really does. So what are the must shift mindset blocks that your seven figure clients have tackled and overcome to reach a million?

Speaker 1:

For sure. There's three main shifts that I see over and over again. I've been able to kind of see it consistently with clients that are getting past the seven figure mark. And the first one is embracing the fact that you are now a CEO, You are not a solo partner, And that mindset shift is pretty challenging. It's one of the first challenging shifts But realizing you're running a business and that needs to be your priority running the business, always serving your clients well. But if you are moving towards seven figures, you have a system and processes and you have a good deliverable to your clients. So you need to start shifting on running a business versus serving clients. That tends to be the hardest shift, but it's the one that can prevent you from going into burnout because you're not trying to do all the things still serving your client as a solo partner and running a business. If you want to move to seven figures, you've got to run a business. That's number one.

Speaker 2:

Okay. So have you ever seen somebody reach the revenue of a million and still not have the P&L? I mean, when do they seek you out and do they wait too long to seek you out?

Speaker 1:

Yes, Most people wait too long Without good history I like to call bookkeepers historians Without a good history you can't look forward and project into the future. So having a bookkeeper or someone who knows what they're doing with your financials right out of the gate is important because when you're ready to start making that shift, when you're profitable, you're seeing the money coming in and you're ready to bring somebody on to help you build a long-term strategy, if you don't have that history, they can't do anything with it. I like to say that I can sit down and read somebody's financial statements and it's a story to me. I can see what's going on in their business and I can see some things that maybe we need to focus on or maybe pivot from to help the next chapter to help move forward. So I have found a couple thresholds, that where shifts need to happen, and getting over six figures is the first one.

Speaker 1:

There also seems to be sometimes a stalling point around 250 of revenues. Coming past that, i find. Once somebody's over 250 revenues, they are moving towards seven figures. That happens rather quickly and that's just from a volume of clients that we provide financials for, people that have brought us in. It seems to be a sticking point. So to me, that's the time to start these mindset shifts. If you're getting close to 250, you're there and especially if you've been sitting there for a bit, you need to start making the shifts of thinking yourself like a CEO, not a solopreneur.

Speaker 2:

Yeah, i've actually heard that number and I've also heard 350. It was just opinions that are thrown out there. But some of that, don't you think that they're on their way? They're on like the fast track. after that, after they hit that, they've probably overcome a lot, they got something down in regards to sales and they've created some processes there. most likely not always, i think it's because they've taken those processes and now they can take some money and put it back into the business, which you say is about 10% right For investments.

Speaker 1:

I do not mean marketing, just business investments, that just continuing your education of your craft or yourself, that's it. This is a whole different beast, interming how much can you spend to still be in a healthy place? But the second shift and I think that this is what you were kind of honing in on at that 250 mark is what we've seen is once people get over that they actually have taken the moves to bring on help, brought in the right of team, because I feel like there's probably just a capacity limitation at 250. And if you haven't gotten to the place where you're comfortable to spend to bring in team members and that could be marketing experts, that could be administrative there's lots of places in business This could be financial, it could be legal, right, that really understanding you need to bring in experts in the field that you are not familiar with.

Speaker 1:

I'm a CPA, i am a financial strategist. I bring in marketing experts because that is so out of my wheelhouse. If I didn't bring those people in, i would be stuck a long time ago, and so I feel like that's the big move to get over that 250 is realizing I need solid team members, not the cheapest I can find or the bare minimum. It's time to actually build a business.

Speaker 2:

Right, so let's talk about money stress. What is a way to alleviate some of the stress that comes with taking on the responsibilities but the money part?

Speaker 1:

In my opinion, it all comes down to knowledge. I can't tell you how many times our first call with a client once we've prepared financials, they have their first package. Shoulders are up here and they're like what are you going to say? How bad is it And when we start talking, no matter what the?

Speaker 1:

status shoulders go down. So either there are areas that need improvement and we develop a plan to improve, Or I get to say you are crushing it Like are you sure that your business is running smoothly, this lean? You know there's lots of different ways that conversation goes, but what it always brings is some peace and confidence. And so, in my opinion, it's knowledge, having the information, knowing what's happening and making that choice to embrace whatever it is that that knowledge brings, that data brings, Yeah.

Speaker 2:

I'm sitting here going. I've had this feeling before. I know exactly what you're talking about, And some people are more procrastinators than others. Yes, And have you ever been with someone that just waited way too long and it totally screwed their business up unnecessarily?

Speaker 1:

Yeah, for sure. I think that I have a client that she was over 500k when she started with me And once we started looking at her data and gaining knowledge, we realized a line of her business. She was spending a significant amount of time And it was making 5% of her total revenues. It wasn't that it destroyed her business, but she had been making all this revenue. But she had no profit because all of her time was in this one revenue source that was costing so much and it wasn't bringing in enough money for how much it was costing her to produce. So I think it's not necessarily backwards. I personally haven't had somebody that literally their business went backwards. But information helps us move forward, no matter where you are.

Speaker 2:

Yeah, when you gave that example, it made me think okay, so why was she doing that? How did she not notice it? Do you feel like there was some kind of emotional thing there, like, for instance, that particular line is what she started with and it was connected to her heart in a sense and she didn't want to let go? or she that's what people seem to be talking about Like, why do you think that she was doing that to the point of not realizing that it was only bringing in 5% of her revenue?

Speaker 1:

I actually have two different clients that I'm thinking of, as you're saying that, and one is absolutely that case.

Speaker 1:

It is her baby, it's what she started with and it is not her moneymaker, but she can't let go of it and she's so connected to her clients She refuses to increase her pricing for it. That's definitely there The client we were talking about specifically. She did not have any emotional issues with letting go and pivoting and pouring into what was really making her more profitable, because a finance strategy, like we said, needs to support the business strategy, and that has to be a Mary of your personal goals and business goals. It's you, your business, it's part of who we are. But this particular woman, she didn't have any issues. She was like, well, seriously, that's all I'm making on that, let's move on. And it was an easy shift, whereas this other client I always just have to be careful you know clients information is extremely sensitive but this other client just, she can't move past it, and so my goal is to help her bring in the profits in other areas so that she can carry that, if that's what she wants.

Speaker 2:

Do you work with a lot of business coaches?

Speaker 1:

I do have a lot of them out there now, yes, yes, i also have a few clients that work with business coaches and sometimes our advice is conflicting. You know, i worked in private equity accounting for 20 years before I started my business and that's just an area that I feel extremely confident in and I won't back down on my recommendations. My clients don't have to take my recommendations, but I feel extremely confident in that And sometimes business coaches conflict with what we're recommending because maybe their expertise is marketing, not necessarily an angel strategy.

Speaker 2:

Yes. So when I started Moxie Entrepreneur and someone referred to me as a business coach, i didn't like it because I didn't feel like that I was. I was more of a business strategist. And then it became marketing strategist. So it was kind of like let's work on your marketing, because that's really what I would help them with the most is marketing and sales Like, how are you getting them? And then all the many different funnels that come in online. That's why I call it online. But I think if someone could actually hire someone that they think is a business coach and that's not what they got, because they assumed or they heard something in their marketing that made them think business coach and they're not. So there's a question here I want to ask. So if a person is a business coach, how do they ensure that their clients aren't just generating revenue but also building wealth? Let's talk about what building wealth actually means versus generating revenue.

Speaker 1:

I think, one defining what wealth is to that female entrepreneur. What does wealth mean to her? Because wealth is not a metric right, it's a personal thing that matters. And so I think first defining what that means and then putting something measurable to it. For example, i said for me financial freedom is me being able to support my family, and if I make above and beyond that awesome, that's great. But that stress goes away when I know that's something I can do at any point in time. I have a measurable goal for that. So first I define it just with my heart, and then we come in and I have measurable numbers. Somebody else could have their measurable number about how much they want to be investing in other businesses or in the stock market each year to get to a certain number, when they want to retire, when their kids get out of college, or something along those lines. So I think that having something measurable after you've defined what wealth is with your heart first, and then figure out how can I measure that?

Speaker 2:

Yeah, i did a little video not that long ago about what Google told me what rich and what is wealthy And it came up with a number $577,000. I think that number was you have to have at least $577,000 put away to be considered in the category of the country's wealthy. Okay, i thought that was interesting that they came up with that number. Yes, and I wonder where it's coming from. Yeah, because I would think that it would be a lot more. Yeah, now that I think about it, i didn't expect to say that And so maybe I'm misspeaking. It could have also been income. It could have actually been income. So I'm gonna have to go back to that and remind myself whoever came up with that number. But we have to know what it is for us. Right, it could be $10,000 a month extra. It could be hitting passive income.

Speaker 2:

I don't know if you know of Robert Kiyosaki's cash flow game. He had a board game. I used to play that with my kids. The schools weren't gonna tell them what passive income was and what that meant, and that game was pretty good at showing them, because they're actually using their little pencils and they say in the cone of learning, that actually is very helpful to actually do the work instead of just hearing it. So you're playing it, you're acting and you're actively thinking about it, but all the many different ways that you can bring in passive income is really something that I love to talk about. So that's something that I would help them with. But obviously you can't have too many, because a confused mind never buys and it dilutes your efforts. So I would like to help them come up with two or three.

Speaker 1:

Right, and to me, those two or three need to be something connected to their personal passion and personal values, not just always. This is the best investment for your money. I have just found that we pay more attention. We joyfully invest in things when our heart's in it. Also, i think that that's important.

Speaker 2:

Yeah, okay. So where does somebody go to work with you to find out more, and do you have something that you offer like an opt-in page, which is something that I always tell people to do? Where do they go to learn more And when should they? I think that we've talked about it a little bit, but when should they and where do they go? Right?

Speaker 1:

Thank you for asking. I feel that you know if our conversation put some light bulbs off, i would be honored to offer your listeners a free 15 minute strategy call If she is ready to really take her business build to the seven figures. I can best be found on Instagram at particular financial, as well as my website, same particular financial. We offer monthly support for female service-based entrepreneurs exclusively. We have several tiers, so we work with a variety of income levels, but the financial simplicity container is my bread and butter in terms of my heart and passion, and it is a short-term container where we walk through all of this that we just talked about building that mindset, understanding where you are and then moving forward to build a financial strategy to support your personal goals and values.

Speaker 1:

The easiest way is just to message me. There's a link in the show notes. It is just particular financial backslash clarity, and you can Instagram me and I can send you the link. Just make sure and let me know that you came from Crystal's show. I also have an opportunity if you're not quite ready for that type of investment. We, at particular, developed a financial blueprint And this is so you can know that one next step to build your financial strategy based on where you are right now. So you go in, answer a couple of questions and then we send you tools and next steps based on where your business is specifically, and so I think that that's a great first step That will be a link in the show notes as well.

Speaker 2:

Okay, awesome. Now I forgot to ask you, so I'll ask you now why did you call your business particular?

Speaker 1:

That's such a good question. I worked, like I said, in private equity for over 20 years. Then I had my kids and wanted to stop traveling so much. I wanted my foot in both worlds, which is only really for me, done by owning my own business. So I started consulting at that time My kids.

Speaker 1:

I have their teenagers right now as of this recording, and I have part-time homeschooled them the entire time I've run my business and part-time homeschool. Part of my kids' education is Latin And so bringing in my family was an important part. So particular is Latin And it's the pairing of my two passions one, my family, and also wine. I love wine, not just drinking it, but I love what wine represents. Veticula means little vines in Latin, and I love that. Wine is shared amongst friends at a table a lot of times with an amazing meal, and that's what I want my clients to feel when they sit down to talk to me. We're not in this stiff structure business meeting. We're sitting at the table with a glass of wine, talking about your business, strategizing, daydreaming and creating a plan together, and so that's what Veticula is. It's definitely hard for people to understand and say, but it's a personal interest of mine And so that's why we've kept it.

Speaker 2:

I love that And just like we have been saying several times now, that money can bring up stress in people, and then there's all kinds of unhealthy ways that they try to manage that, and procrastination is one of them. And so if wine or sitting down, and not that you sit down with wine every time, maybe you get better results that way. I don't know, but you don't have to do that, but it's the idea.

Speaker 1:

No, it's the idea of community.

Speaker 2:

Yes, community and relaxed conversation. Yes, absolutely An awesome result and life-changing result, actually. Ok, so I've got your links in the show notes. I wanted you to share to make sure that we're all sending them to the right place. Thank you so much for being on my show today And I look forward to learning more and connecting with you more and sending people to you. Thank you, crystal, it was a privilege. This is an important topic.

Speaker 1:

Yeah, I agree. OK go back music.

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