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Sep 14, 2020

Time May Be Ripe for a CPA Move into Consulting

The economic uncertainly introduced by the COVID-19 pandemic might make it seem like a bad time to take a significant career leap, but business strategist and consultant Veronica Sagastume believes the timing could not be better. She discusses the signs that a CPA may be ready for such a step, ways that CPAs can generate revenue for their consulting business, and the importance of establishing a personal brand identity for a new venture.

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By: Bill Hayes, Pennsylvania CPA Journal Managing Editor

Podcast Transcript

While the situation surrounding COVID-19 has introduced all manner of uncertainty into the accounting profession, today's guest says now could be the perfect time for CPAs to consider launching or planning for a foray into the consulting industry. To find out why the timing could be right for such a move, along with the signs that a CPA may be ready and some tips for quick revenue generation once a CPA gets started, today we are talking to business strategist and consultant, Veronica Sagastume.

Why would you say now of all times would be a good time for a CPA to either launch a consulting business or get planning on making that move?

[Sagastume] This is one of those things where no one could have predicted what 2020 was going to bring. Along with this season of pandemic and working remotely, there also is always opportunity. I think now more than ever people have to be thinking about what's going on. The uncertainty of the future is definitely going to have to come into play of thinking about what are some ways that I can prepare in case something happens with my employer, with the business that I'm working for, the company that I am part of. Hoping for the best is no longer an option.

I think that most CPAs or accounting professionals need to really be thinking about other sources of income that they could generate. That's one of the things that I often find myself talking to clients about is thinking about your future will now include maybe taking action into something that they had been thinking about for a really long time but never really taken action on because there's always more work to do. During these uncertain times is the time to really step back and think about what else could I do.

What would you say would be some of the signs that a CPA might be ready to, or might have the ability to, launch a consulting business?

[Sagastume] One of the things that I hear most often is we know the CPA lifestyle of working really long hours, working through weekends, working through holidays, and other maybe important events, and during the time of now working remotely, they may be thinking, "Okay, well, if I can work remotely for my employer, perhaps I can do this for myself." One of the signs is to start thinking about, could I do this for myself? Do I have enough skills? Another sign is to be thinking they've been really frustrated with their work-life balance, which never really truly exists with a busy CPA professional. Another sign could be that they're feeling frustrated with their lack of advancement or their promotional advancement that doesn't match their true ambition. I would say the other most common factor is that they're starting to crave to build something of their very own, to have that flexibility and creativity.

Once a CPA has decided to make this move, what would you say would be some ways that a CPA could generate clients for their consulting business, whether it be within their current network or even from the outside?

[Sagastume] I have found that most of the time your first or next consulting client is in your contacts, in the contacts of your network. That is something where it's as simple as taking inventory of all those contacts that we have built up throughout our career, whether it's through people that we've worked with, people we've worked for, people we met at events, conferences, workshops, whatever. You start looking at the contacts in your network and think about who could benefit from some of the skills that you have. When you do create an offer, who could you then reignite a relationship with by reaching out, whether it's an email, a text, a direct message? There's so many different ways that we can connect with the contacts in our network.

Right now is the perfect opportunity to reach out and reignite those relationships because we're all craving for connection, since we have all been ... this social distancing has kept us from being in the same room with each other. So there's no time like the present for you to reignite with those people, the contacts in your network, so that when you are ready to make that offer of your first maybe micro service offer that you want to go out with, they'll be nurtured. By nurture, I mean, reignite the relationship by reconnecting with them, not just ... don't come out of the blue and start selling, pitching your services right off the bat.

What would be some of the benefits a CPA would experience from striking out on their own in consulting?

[Sagastume] One of the main factors that comes out of this is having the flexibility to reframe their workday, to maybe have the flexibility to carve out time to take care of certain things that maybe your priorities shift, whether it's through having kids that need your time, especially right now, that there's this distance learning going on with your kids, or maybe there's an elderly parent that requires your attention. By having your own consulting firm or your own consulting business, you're able to create your day the way that you want while you're still going to be serving your clients, showing up for your business, showing up for all of your priorities, both personal and in business.

Another thing that happens while you're building this business that you have been craving to do is there comes a point where you can have a greater impact and a bigger earning opportunity, therefore removing that salary cap that so often we reach, especially in the CPA world where you're either on a road to partnership or you end up leaving the CPA world and going into private companies. You accelerate that earning opportunity for yourself.

We're listing so many of the benefits, but we want to make sure that we give both sides of the picture. Are there drawbacks or obstacles to success that CPAs should be weary of before they take such a leap?

[Sagastume] Absolutely. I call it the dark side of consulting and how to prepare for it because it does come up and it doesn't come in a matter of a certain order, but it's good to be aware that it will come up for you, and, when it does, for you to be ready to work through those challenges. One of them being your mindset. You are going to be going out on your own. You let go of the security of an employer, of a regular paycheck and benefits, and you're trading it in for this unknown journey of entrepreneurship. And those doubts, the self-doubt, the lack of confidence, the impatience, the imposter syndrome, all those things can come up for you. But if you are aware that they'll come up and you think about what are some steps that you can take to combat them, to get through them, such as reading books, surrounding yourself with people who have been there and can help you navigate those choppy waters or listening to podcasts like this one, where you could just nurture your mind in order to understand that self-doubt … don't trust it.

Your mind is going to work against you in those early days because you're venturing into a new thing. So just be aware, the mindset is the number one thing that you need to be aware of when that little voice starts to say, "What are you doing? Why would you leave it?" Combat that. Get ready to just have the tools in order to get through them.

I would say the other one is I'm going to talk about money. Oftentimes, especially with our accounting background and whether it's accounting, finance, or tax, we have to prepare for when we start something new, you have to have reserves. Cash is king at the end of the day. If you have the reserves to start your own business and to get you through those early months where you're starting to figure it out or you're putting out your offers, you're getting new clients to engage you, you may encounter clients paying late, or you may not have ... you need to have enough money to pay for your own personal bills, as well as the business bills, because you will have them. In order to prepare for that, start building that cash reserve so that when you start doing the business, you're not worried about running out of money. I'm going to have to go back to get another job. Set yourself up for success by preparing for the start of this new journey. Even if you start the consulting business on a part-time basis as your side hustle while you're in your full-time job.

What is a personal brand identity? How do you establish one? Why is it so important to have one if you're going to have success in consulting?

[Sagastume] I think the way that I explain this is personal brand has two roles. The first one being your reputation, your reputation as a person, your reputation as a service provider, as an employee. It starts with your corporate career. The people who know you in your corporate career could be like, are you someone that they can count on? Do you show up on time? Do you meet your deadlines? Do you cross every T and dot every I? Are you thorough? That is basically the reputation is the way that people talk about you when you're not in the room because of your consistent actions, the way that you show up in your life and in the business for your employer and for yourself.

The second part of that is being ... the reputation that goes beyond your characteristics or your character is about what do you want to be known as an expert in? This is where you start to combine the personal brand of our characteristics, along with our specialty. Basically, that's where we talk about niching down. You get specific about what you're an expert in, who you help, who do you solve problems for, and how do you do that. That specific trait or character system that you combine with your own personal reputation is what makes it so powerful because now people can make ... it's so easy for people to refer you, for you to be top of mind, because you are somebody that they can count on and that somebody ... let's say you were to refer John Doe and you said, "Oh my gosh, I have worked with this person. He always delivers. He exceeds expectations." It's the way that you talk about that person, that is that personal brand.

And then you say, "He is an expert in this system, NetSuite," for example. "NetSuite implementations, I've got just the guy for you. Let’s put you in touch with him." That personal brand is a powerful one. It can't be beat.

When CPAs are going to school, learning to become CPAs and taking the CPA exam and everything like that, I'm not sure there's much in those exams on social media.

[Sagastume] Nothing.

Absolutely not. But how vital would you say social media has become in building your brand and your following in consulting? What are some best practices for CPAs using social media avenues well? What would you say the best platforms are at this point versus what's outdated?

[Sagastume] What's outdated right now is the ... I think that gone are the days of perfectly curated videos in a social media feed, whatever platform, whether it's LinkedIn, Instagram, Facebook, Pinterest, whatever. Those days of perfectionism are gone. Especially in these uncertain times, we're all having to be more resourceful. What I would say is for CPA firms, for bookkeeping, tax operations, any kind of financial services, there is such an opportunity right now because people have now seen that we can work remotely. We can work online. We can deliver a service and feel confident in that things will get done. In today's environment, more and more people, because they're feeling comfortable working remotely, there's an opportunity for all of these businesses to have a greater impact, to have a bigger audience that they can reach out to and connect with and convert into clients. You need to have an online presence in order to do that.

The thing that works best is for you to figure out, okay, who is my ... I know that I hear a lot of the ideal client avatar. I actually don't like that. I like to think about who are the clients that I like to work with? Who are the types of people that I love to work with? From there, I start to create content. I advise my clients to think about how you can show off your expertise by teaching something. That's what's working really well right now: education, with a relatable example or a story or a case study, whether it's one of your clients or a personal one.

When you show up online and you select a channel where your clients are … for example, most of our clients are on LinkedIn. That could be your primary source, your primary platform. Then you decide, "I'm going to just share a bunch of educational tips." But here's the key. You can't just throw facts at people. People relate to people. Your other business owners are going to invest in the person behind the business. Make it relatable by sharing stories. Like I mentioned, case studies, whether it's one of your own examples or an example of your clients. There's a great opportunity right now, so stop being fearful and just start showing up and be of service to people who need to hear from you.

As you said earlier, any person who's starting a new business or they're going out on their own for consulting, it's not just going to fire up right away. It takes a little time to get it started. But at the same time, do you have any tips for ways to quickly generate revenue when CPAs jump into this space?

[Sagastume] My first tip would be to create a service offer that can generate quick results for a client. When you're thinking about what could I offer, who do I offer it for, create something that you can basically deliver a service for a client that can just take a few hours in order for them to feel like they got something out of it. Something like a cash-burn analysis, cashflow projections. Especially in these uncertain times, you can create a very simple short offer that maybe talks about, I'll review your contracts and assess where there's areas that you can renegotiate for some savings that will impact your cashflow favorably. That is something that you can do in a couple of hours. You could define this simple offer. You could price it. You could tell them how you're going to deliver it.

That is something that you could totally do remotely in a few hours, and then create a couple of page reports where you tell them what you assessed, what your findings were, and give some recommendations for their favorable cashflow output. Something like that. Think about what skills you have, something that you could deliver remotely online very short, because once you get a client one result and they feel like they've got a great output in the whole relationship or the whole journey with you, that's going to make them either be like, what else can you do for me, or you get that social proof to then go out into your existing contacts, your network, to then pitch that same offer in a bigger ... just pitch it to a bigger audience. That, I've seen work beautifully.

Especially right now, during these uncertain times in the past four to five months, people showed up saying, "Hey, I'm going to assess all this stuff for your team so they know how to still collaborate on creating the budget or how to review or get all the workbooks for the tax preparation with fiscal years coming up in mid-year." The other thing that I saw work really well is creating an offer where I will help you to prepare everything that you need in order to apply for the Payment Protection Program earlier this year. One of my clients did that. He was able to sell that simple service offer. I think probably sold 15 to 20 within two weeks. He was busy, but it was during that time when everybody got sent home. He just got busy doing that.


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Podcast transcripts are provided as a summary of the conversation and have been lightly edited for the written medium. The transcript is not a verbatim representation of the interview.
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