Our Fifth Anniversary
It's been five years since I started my investment firm, Parrott Wealth Management, and, so far, so good. At age 50, I was tired of working for others, so I acted on faith and started my own company. According to Entrepreneur, my odds of survival were 50/50. The author of the article said companies fail because of a lack of focus and motivation or pride. Thankfully, I was motivated to succeed, and I checked my ego at the door.
As a financial planner, I put my planning skills to the test before I started my company. I relied on Excel spreadsheets and my HP12C to crunch numbers to see if my head matched my heart. I investigated numerous sites on starting a business, read several books, talked to a few people, and prayed always. Running also helped. I ran the San Diego marathon the year I started my business, so I had plenty of time to think through different scenarios on my long runs around Lady Bird Lake and the City of San Diego.
During the summer before my official launch date, I was vacationing at Wind River Ranch in Estes Park, Colorado. At the entrance to the ranch, the words from Psalm 46:10 are written in stone: "Be still, and know that I am God." Each morning my wife and I attended a bible study led by Pastor Chris. He spent the week talking about addressing our fears. He and I spoke about his sermons while fishing and hiking; His teachings and insights gave me the courage to act.
At home, I'm part of a men's bible study. As I was contemplating starting my business, I looked at the other men in the room – all but two were self-employed. If God took care of them, he would do the same for me.
As I review the past five years as a business owner, I was never afraid or fearful. I had trust in my analysis and my process. My plan was working. I had faith that God would provide for my needs, and He has, and then some. Here are a few takeaways from our firm's success.
- Plan. Before starting my firm, I spent many nights crunching numbers for my family's finances. I made sure I had enough money in the bank to pay for three year's worth of expenses, including my daughter's college tuition payments. I had the financial resources to proceed.
- Exit. I created a stop-loss for my savings account. If my bank balance dropped below $50,000, I would shutter my business and rejoin corporate America.
- Spend. I spent a lot of money on the necessities – office space, software, logos, websites, etc. I wanted to offer clients and prospects the same services they would find at larger firms. I also wanted to appear bigger than a one-person shop.
- Hire. In 2017, I added Janet Jackson as the Director of Client Services. She has allowed me to pursue other activities to grow the firm while handling back-office operations.
- Try. I tried numerous strategies and pursued many markets as I built the firm – some stuck, most didn't.
- Review. I'm continually reviewing strategies and data to make sure our firm is on the right path. I participate in several benchmarking studies, so I know where my firm ranks relative to the competition.
- Listen. Soliciting feedback from clients, friends, partners, etc. has been vital. Based on their input, I'm able to adjust the firm's direction.
- Boundaries. I receive several calls from wholesalers, phone companies, lead providers, advertising specialists, and so on, all wanting a few minutes of my time so they can better understand my business model. I say no, a lot. I don't clog my calendar with activities that will not benefit my firm or our clients.
- Thanksgiving. I feel blessed to work for myself. I'm thankful I had the opportunity to start my own company, work with fantastic clients, and hire a great employee.
The Entrepreneur article I referenced earlier gives a business a 30% chance of survival after ten years. Who knows what the future holds, but I like our odds.
"Being self-employed means you work 12 hours a day for yourself, so you don't have to work 8 hours a day for someone else." ~ Oliver Markus Malloy,
September 8, 2020
Bill Parrott, CFP®, is the President and CEO of Parrott Wealth Management located in Austin, Texas. Parrott Wealth Management is a fee-only, fiduciary, registered investment advisor firm. Our goal is to remove complexity, confusion, and worry from the investment and financial planning process so our clients can pursue a life of purpose. Our firm does not have an asset or fee minimum, and we work with anybody who needs financial help regardless of age, income, or asset level. PWM's custodian is TD Ameritrade, and our annual fee starts at .5% of your assets and drops depending on the level of your assets.
Note: Investments are not guaranteed and do involve risk. Your returns may differ from those posted in this blog. PWM is not a tax advisor, nor do we give tax advice. Please consult your tax advisor for items that are specific to your situation. Options involve risk and aren't suitable for every investor.
 https://www.entrepreneur.com/article/288769#:~:text=In%20a%20study%20by%20Statistic,70%20percent%20after%2010%20years., Patrick Henry, February 18, 2017.