Coaching and Beliefs

Human beings suck at the main life skill: modifying our beliefs. Our beliefs create our reality. They dictate our thoughts and actions.

Have you heard of the confirmation bias? We, humans, subconsciously seek for the inputs that confirm our pre-existing convictions. And ignore everything else.

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This mechanism is intended to save our brainpower, but in reality, it severely limits our potential for growth and change. It limits our potential to make our lives better.
If all you know is misery and struggle, and you automatically look for the signs of misery and struggle, how can you notice the opportunity to improve your life? How can you grab it, if you don’t even recognize it?

Changing One’s Beliefs

You can argue that if this is how the human mind is constructed, it’s tough luck and we are sentenced to whatever belief systems we’ve created for ourselves. But that is not true.

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Solopreneur: You Are Your Business!

Part III: The Solopreneur’s Self-care Framework

Prioritize self-care. Adopt the mindset that you are your business — the most crucial, important, and indispensable part of your business. This is the way to be “fine” or even “thriving” in the long period.

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How to do this? Through everyday small habits, which will take care of all areas of your life.
Humans are holistic beings. It’s not enough to have great relationships, great health, or a great intellect.
In fact, usually a deficiency in one area often creeps into other areas of your life. You need to prevent that. You need habits in each and every area: finances, health, spirituality, relationships, personal growth, and professional growth.

It doesn’t have to take you a lot of time. Hal Elrod’s Miracle Morning formula starts from six minutes, and it covers most of the above-mentioned areas. Especially, when you don’t have any good habits, even the smallest habit can make a lot of difference.

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Solopreneur: You Are Your Business!

Part I: Your #1 Priority

Imagine a solopreneur or a small business owner with a very small team, who is still the heart and the brain of their company. What should be their priority?
Probably, they are responsible for marketing and sales, maybe for part of the operations or admin stuff. What should be their number one focus? Cash flow?
Paying taxes on time?
The prospecting and sales processes?
Documenting processes?
Time management?

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They all are crucial areas; however, their #1 priority should be self-care.

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Profit First: A Solution to Cash Flow Problems Plaguing Small Businesses

The number one sin when it comes to cash flow management in small business is not managing it at all. “I don’t know where it all goes” is not the right answer for the business owner. In fact, it is the answer that kills most small businesses. 82% of them, to be precise.

Cash flow deserves your attention, or else… “Or else,” in this case, means bankruptcy.

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Before you even start managing your cash flow, you need to have a clue about your costs and revenue streams. Not only about their volume, but also their nature. Not paying your contractor for a month or a quarter may not prove fatal, but not paying due taxes to IRS? It may be beyond fatal, depending on your business and private liabilities.

The same goes with revenue streams. It’s great you invoiced your customer for the job finished today. But when will the money appear in your bank account? In a week? Or maybe sixty days? You still need to pay your people and cover your bills in those sixty days!

Level #0: Tracking

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If you “don’t know where it all goes,” you need to start tracking your expenses (and income) immediately. If you are organized enough to have all the payments registered in one place, this is the perfect place to start. But small business is a wild creature prone to whims of the owner and the nature of the beast.

For example, I have dozens of income streams, and sometimes they are miniscule. Often, I cannot control how I’m getting paid. Amazon transfers my book royalties directly to my bank account in euro. Findaways pays me via PayPal. Customers from Reedsy pay me via Stripe. It already makes things more complex than they should be.

But that’s not all. I have a customer who transfers money to me regularly into my PLN bank account. Another, who pays me in Euro. If I get a Polish customer, they also pay me in Polish Zloty.

However, the revenue part of my business is simple comparing to the cost part. I have subscriptions paid via debit cards connected to my US dollar account. I have subscriptions paid via PayPal. I pay for Amazon ads with debit cards, in different currencies on different markets to save on the exchange rates. I pay my accountant in PLN – and my taxes and social security fees. I pay my virtual assistants via Wise.

It’s a crazy mishmash, and I track it all in Google sheets to have one place where I can see my real cash balance.

If your financial/accounting system doesn’t resemble a Frankenstein monster patched together from many different parts, tracking your finances should be a breeze. If it looks exactly like Frankenstein (like my maze of payments), you still need to track each incoming and outgoing cent. Even if you have to do it manually in a Google sheet.

Paraphrasing Peter Drucker: “You cannot manage what you don’t measure.”

Tracking your money gives you the idea – or precise numbers – of how much funds you really need on a monthly basis to operate.

Different Kinds of Costs

There are a few categories of costs you should be especially aware:

-tax and legal liabilities


-recurring fixed costs

-operational costs

The first category is important because it can be the difference between living with an axe over your head or the axe chopping your business’ head off.

Salaries are of sensitive nature because your people have stomachs. Their kids too. If you don’t pay them, you may not have people to work for you next month.

Fixed costs are self-explanatory. If you have a brick-and-mortar business and you won’t pay the rent for your “bricks,” you will be out of business in no time. There are some categories of costs that simply must be paid so you can continue to operate.

Operational costs are something different – those are the costs necessary to deliver your products and services. In other words, they are dependent on the volume you deliver. For example, I pay a freelancer for creating the ads for my customers. The more ads we create, the more I pay, but if there is no activity, I pay nothing. Thus, this is not a fixed cost.

Different Income Streams

Tracking only your costs is not enough, especially in an enterprise. You could’ve skipped it if you are an employee and receive the same check every month. However, in business the revenue is not only volatile, it also often comes from many different sources.

For example, my income comes from three main sources – book royalties, coaching, and my book advertising business. Yet, each of those sources divides further into more streams. My book royalties come from audiobooks, eBooks and paperbacks; from Amazon, Draft2Digital, Findaways, and PublishDrive. I don’t even count the sparse payments for foreign rights and other 1-time payments.

Level #1: Bank Accounts

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Once you have a loose idea where your money comes from and where it all goes, you can get busy with setting up a simple system, which will show your cash flow at one glance.

In almost the whole civilized world, you need a bank account to run a business anyway. In most countries, it is required. Hence, you use what’s required to setup your cash flow solution.

The Profit First concept is based on the envelope system from the personal finance world. You get incoming money, and then you allocate your cash for specific purposes. And you do that all within your bank.

You need a few to several bank accounts for that purpose. First and foremost, you need the Incoming Account. This is where all your clients send their payments to. This is the only function of this account: to collect payments. You don’t use it for any other goal. You don’t pay ANYTHING from it: no taxes, bills, subscriptions. Nothing. It serves to accumulate the revenue streams.

Then, you need a few (or more) accounts for different purposes, like your grandma needed a few envelopes to manage her cash. You will need a minimum of four such accounts: taxes, owners, opex (operating expenses), and profits. It is recommended that the taxes and profits accounts are in a different bank and not easily accessible to limit the temptation of borrowing from them to pay yourself, your contractors, employees, etc. Once the money is transferred into those accounts it is untouchable.

You can make this system as robust as you prefer. I send owner’s pay to my private account, but then I allocate money further within digital envelopes: for mortgage, bills, Christmas gifts, car repairs, white goods, gas, and so on. The same goes for my business. I have a separate account from which I pay my VAs and a few accounts in different currencies to pay for goods and services. This is my way to lower the costs (I save on exchange rates) and to make sure I have the funds necessary to pay my various business bills.

You can also use the Profit First system to fund your future investments. Let’s say you want to hire a new person. You create a new bank account and name it ‘New hire,’ and each month you put there a slice of your revenue after taxes. When you will be ready to hire, you will have no headache where to get money for an additional salary. Also, allocating a part of your revenue in advance will clearly show you if your business is healthy enough to afford yet another employee.

When buying a piece of an expensive equipment, the principle is the same – keep setting aside a fraction of your revenue for a few months till you can actually afford it.

Level #2: Thresholds

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OK, but how much of your revenue is dedicated to salaries, and how much for a new hire or equipment? This is where Profit First thresholds come into play. Exactly like your grandmother knew how much she should put into each envelope, you need to know how much to allocate into the bank accounts you created.

Profit First thresholds are the centerpiece of the whole system. You tracked your income and revenue streams, and you created the bank accounts, so you can now put the thresholds into use.

So, what are Profit First thresholds, and what do they do? Each of them is a simple percentage metric, which tells you how much of your revenue you should allocate into specific accounts.

Let’s stick to the simplest example: you have only five accounts – incoming, taxes, owner’s, opex (operating expenses), and profits. The incoming bank account is just a “bag” for collecting money. Then, the thresholds inform you how much to transfer to each of the remaining four accounts. Let’s say, 10% goes for taxes, 50% for owner’s salary, 35% for operating expenses, and 5% for profits.

You can have more bank accounts (a new hire…) and thresholds. Of course, the laws of the math require that all the thresholds sum up to 100%. So, if in the above example, you want to start setting aside money for a new employee, you need to open another bank account and assign a threshold to it. Let’s say, 5%. But where to get that 5% from? Stealing from Uncle Sam is a bad idea, so definitely not from the tax account. You can diminish your profits, but never to zero. Thus, take 4% from profits and 1% from owner’s. The new set of thresholds looks like this:

Tax: 10%

Owner’s: 49%

Opex: 35%

Profits: 1%

New hire: 5%

Sum: 100%

Seriously, you can have as many objectives connected to bank accounts, as you wish. Currently, I have seven in my business, and I’ll soon add the eighth because I’ve been delusional about my fixed costs and need to take the proper care of them.

What is the main benefit of Profit First thresholds? Automation. You don’t need to think about what to do with your money. Its destiny is already determined. When a client pays you $100, you put $10 in the tax account, you take $49 for yourself, save $5 for a new hire, set aside $1 of profit, and transfer $35 to your opex account.

You don’t need to fiddle with your money – ever again. You don’t need to steal from Paul to pay Peter – never again. You will always have the money to pay your taxes, bills, salaries… and you will always have some profit, even if it will be as tiny as 1% of your revenue.

How to assess your initial Profit First thresholds? Guesstimate! This is where tracking and analyzing past data pays off. If you have been in business for three years, you can estimate how much in taxes you really pay. I cannot tell you this. Not even an experienced accountant can tell you this out of the blue. Each business is different. The exemplary thresholds above are more suitable for a solopreneur with an online business – low revenue, so he consumes the main bulk of it; relatively low costs of running a business, relatively low taxes.

However, in case of a bigger brick and mortar business, the thresholds could’ve been very different: 0% of taxes, cos’ the business is in the red.
60% for operating expenses, including installments for the heavy equipment (thus no profits and high costs).
5% of owner’s salary, because the revenue is over a million, so it is enough for a modest lifestyle.

Level #3: Leveraging the Profit First System

Photo by Karolina Grabowska from Pexels.

Now, you have everything in place – bank accounts and thresholds. All you need to do is to use them, and keep using them.

The revenue comes to your incoming account. Every so often, you distribute the revenue among your bank accounts according to your Profit First thresholds.

In his book, Mike Michalowicz recommends doing it twice a month, on the 10th and 25th day of the month – thus you will have money for bills and salaries, which are usually paid at the middle or the beginning/end of the month.

But you can do it as often as it makes sense for you. Maybe you have such an abundance of cash that once a month is enough for you. Personally, I do it 4-7 times a month because I’m chronically short on cash (which only proves that I need to adjust my percentages). Yes, it obviously consumes more of my time, but the allocation of the funds is the business activity I enjoy the most. I don’t mind it at all; in fact, I’m always looking forward to it. I eagerly check my receivables if they summed up to a few hundred bucks and then play the Profit First game.

Which, by the way, is the way I recommend to anybody who starts implementing the Profit First system. The more often you are using it, the faster it becomes your habit. If you perform the funds allocation every few hundred bucks, in a few weeks it may become your second nature.

Michalowicz also recommends to login to your bank account once a day and check your accounts’ balances. This is the real benefit of the system: you are feeling the pulse of your business. Cash flow is like a blood circulation system for your organism. Sometimes blood flows slower, sometimes your pulse accelerates, especially when you increase your physical effort. Your overall health depends on your bloodstream. The health of your business depends on your cash flow.

Once every quarter, you use your tax and profit accounts to pay taxes and do profits distribution. At the end of the year, you may make a few serious decisions about investing your profits. That’s it. So much financial headache is blown out of the water with just a few daily, bi-monthly and quarterly actions.

Peace of Mind

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If you properly implement the Profit First system, it provides peace of mind incomparable with any other “accounting” system. It eliminates dozens of daily financial dilemmas:

Should I pay this bill or that contractor?

Will this client pay before I need to process the payroll for my team?

If I pay my personal bills this month, can I still afford to pay my business’ bills?

Everything is predetermined and automated. The only decisions you need to make are about the allocation percentages and you will make them only every so often – you will cut your costs, so you will be able to allocate more for profits; or you will get a better feel for how high your real tax fee is and lower that threshold; or you will get a few new customers, so your overall revenue will jump, and you will modify Profit First percentages accordingly.

The beauty of this system is that it is so intuitive. You will have a look at your bank accounts every day. You will supervise the distribution of funds. You will quickly notice the places where you are short on cash. What is more, you will have concrete data and numbers to crunch, not just your gut feeling.

Like a bloodstream, your business’ cash flow needs constant adjustments. With the Profit First systems, making those adjustments comes naturally.

No More Overstretch

Another big benefit of Profit First is that it makes it really hard to be careless with your money. No more:

“Let’s buy this truck!”

“Let’s hire a new person!”

“Let’s move to a bigger office!”

You can do all of the above, but when following the Profit First system, you will have to find the place to get this money from. Should you cut your own salary? Increase revenue? Or maybe your threshold for the operating expenses was high enough that you can accommodate this investment? One glance at your data will provide you the right answer.

However, in most cases, I guess the answer will be: “Nope, we cannot afford this new shiny object.” Profit First grounds you in reality, provides a clear state of your bloodstream, I mean cash flow. It leaves no space for wishful thinking. It prevents you from making stupid and costly decisions.

In short, it saves your business’ butt from oblivion. 82% of small businesses go out of business because of their cash flow problems. Implement the Profit First system, and you will not be one of them.

How Not to Be Lonely at the Top

Isolation is the worst enemy. Collaboration is a path to success. OK, so how to actually get out of isolation as an entrepreneur?

There are four ways to do that, which I practiced myself and saw working. Plus, they are no secret, they were around for thousands of years, and they have been always working – because humans are social animals!

1. Accountability Setup.

Get one person, just one, to keep you accountable for specific venue, goal or project. The most important thing in this method is consistency. If you are to meet once a month for an hour, do it once a month – every month. If you are to call each other every morning at 8 am, put it in your calendar and stick to the schedule.
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The Worst Enemy of Entrepreneurs (no, it is not the IRS!)

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Freelancers, solopreneurs, and business founders face the same enemy, and it is mostly invisible: isolation.

Isolation is the enemy of excellence.” – Aaron Walker

You are alone with your thoughts all day long. Even if you have a team, there are some limitations to what you can share with them.

Will they stay with you, if you admit you are not sure how you will pay their salary next month?

Wouldn’t the upcoming downturn in your industry scare them off to look for a job elsewhere?

So, you ponder those worries and issues alone, in isolation.

Small Business Administration says that problems with cash flow is the #1 reason why small businesses get out of business. I dare to disagree. Behind 95% of bankruptcy cases lurks isolation.
Entrepreneurs are human beings, and human beings are designed to thrive in a pack, not in isolation. Thus, alone, they do all kinds of stupid things, which they wouldn’t have committed, if they could share their burdens with others.
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Principles #7&8 Separating Successful Entrepreneurs from Those Who Went out of Business

7. Systems and Delegation.

Solopreneurs suck at this, big time. And why not?! They are doing all the tasks anyway, so why waste their precious time for something obviously unnecessary?

Well, I can tell you from my own experience that preparing a standard operating procedure and checklist can speed up execution of almost any task – especially, if you do it periodically, but not very often. Instead of recalling it every week, you just take out the checklist and breeze through the subtasks.

That’s one benefit, but there is a myriad of others: going consciously over your processes, you can pinpoint inefficiencies in them (and optimize them),
-you can organize your systems, so you will minimize confusion when switching from one task to another,
-you will have all the resources (credentials, links, etc.) in one place, so you will no longer waste precious minutes on looking for them in your chaotic notes or hard drive.

Photo by Pavel Danilyuk from Pexels.

However, the biggest advantage is that as soon as you document any task, you are able to delegate it out.
It’s especially crucial at the very early stages of business, when you are doing everything. Then, each task taken out of your plate creates a space for you to take care of yourself, spend some time with family, take a moment to strategize, move on to more valuable jobs, and so on.

8. Vision, Mission, Values.

It seems like an afterthought, something big corporations write down only to disguise their greedy nature in order to be perceived positively.

That may be the case for big corpo. In case of small business, those elements have two major functions:

a) To motivate; first to motivate you, a business owner. Entrepreneurship is a wild rollercoaster. It can put you down, discourage you, and make you cry. In the times like that, you need a compelling vision that will pull you forward, despite all the obstacles and struggles.

But it works in the same way for your people. Employees want to feel they are a part of something bigger than themselves. Slogging for the paycheck alone was never attractive. A compelling vision is much better than a hefty salary.

b) To simplify; if you didn’t ever write down the vision mission and values for your business, you have no clue how many headaches it will spare you.

A few months ago, my biggest customer sent me an email full of complaints. Frankly, I got mad at first. But I slept over it, and suddenly the right answer just popped in my mind: This guy doesn’t trust me. Or at least, I didn’t feel like he trusted me. But Trust is the main core value of Resurrecting Books.

Thus, I replied to him that I’m ready to finish our cooperation, if he cannot trust me. Since then, we continued to work much more smoothly.

My mentor, Scott Beebe, told once on his podcast a story of a construction company whose core value was No Debt. They declined a huge job because they couldn’t do it without getting into debt. The man who proposed that deal was so impressed that he made a different deal with them and continued to provide more contracts for them.

Drawing the line in the sand, defining who you are and what you stand for is great for your own sanity, but it is also great marketing. People will quickly get who you are, what you do, and they will bring referrals to you because they will be able to spell out your mission and values. That will not only get you new customers, but the right customers! At no cost, just by being who you are.

Nine Universal Business Principles
Principle #1 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #2 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #3&4 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #5&6 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #7&8 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #9 Separating Successful Entrepreneurs from Those Who Went out of Business

Originally published in Medium.

Principles #5&6 Separating Successful Entrepreneurs from Those Who Went out of Business

5. Cash Flow.

Cash flow is, by far, the #1 reason small businesses are getting out of business. Yet, so many entrepreneurs, especially those in the early stages of their business, choose to ignore their cash flow, altogether.

Investments, tax deductions, fixed costs, delayed payments, tax liabilities, amortization, and deals in progress – they are all important, but cash flow is a lifeblood of your business.

It doesn’t matter if your business looks solid on the PNL sheet, if your cash flow is suffering. It doesn’t matter if you have strong muscles, a healthy liver and kidneys, if your heart is not pumping blood through your veins.

Stop ignoring your cash flow, start tracking it. That’s a small discipline, which creates success.

6. Sales and Marketing.

In one of the recent interviews on Brian Buffini’s “It’s a Good Life” show, his guest, Kyle Wilson spilled that Brian’s company is around the billion-dollar mark. Yet, Brian is still the central hub when it comes to sales and marketing of his company.

Of course, he doesn’t do even 5% of the work done by sales and marketing departments (I doubt he does 1%), but he holds the ownership of those activities. He has the final say, but also his personal brand still brings a huge chunk of the new business for his company.
Dave Ramsey said the same about his company, Ramsey Solutions, which approaches half a billion in yearly revenue.

You cannot abandon the responsibility for sales and marketing in your business. If such tycoons of business, who employ thousands of people, are still in charge of those activities (because it works, it’s profitable!), what makes you think you could outsource sales and marketing and forget about them?

Nine Universal Business Principles
Principle #1 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #2 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #3&4 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #5&6 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #7&8 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #9 Separating Successful Entrepreneurs from Those Who Went out of Business

Originally published in Medium.

Principles #3&4 Separating Successful Entrepreneurs from Those Who Went out of Business

3. Un-isolation.

We are social animals. We need others to excel. That’s the human nature.

Isolation is the enemy of excellence.” – Aaron Walker

However, being a solopreneur is a lonely occupation by definition. It doesn’t get much better when you start hiring people – you need to be the rock for them and keep your struggles to yourself.

Well, you can cooperate in other ways. Get involved in an online community (like SPI Pro), join a mastermind, hire a mentor or coach. Alone, you can never excel.

4. Time Management.

Or priority management. Or managing yourself in time. However you will call it, the efficient usage of one’s time makes the difference between successful and unsuccessful entrepreneurs.

Time provides the only real equal opportunity in the world. Everybody has 24 hours a day. However, if you are one of those who “don’t know where my time goes,” you are in great danger as an entrepreneur.
Yet, it is pretty rare to find people who actually do know where their time goes.

Photo by cottonbro studio from Pexels.

One hack in this area: make your calendar a foundational piece. When I was starting my side hustle and was truly the only one who worked in and on my business, I didn’t understand the value of living by your calendar.

But now, when I have to coordinate several recurring weekly calls, get on the podcast interviews, have a team of several people, my calendar became crucial for my effectiveness.

Since I actually started using my calendar on a daily basis, it’s been a game-changer for me.

Nine Universal Business Principles
Principle #1 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #2 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #3&4 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #5&6 Separating Successful Entrepreneurs from Those Who Went out of Business
Principles #7&8 Separating Successful Entrepreneurs from Those Who Went out of Business
Principle #9 Separating Successful Entrepreneurs from Those Who Went out of Business

Originally published in Medium.

9 Universal Principles Separating Successful Entrepreneurs from Those Who Went out of Business

Photo by Olia Danilevich from Pexels.

What does it really take to be successful in business? There is so much noise nowadays. Some claim it’s a brilliant idea, others say it’s about solid business tools, and others say it’s hard work.

Some claim it is such a complex matter that it is impossible to tell. I heard Brian Tracy on a podcast episode when he quoted a huge research on entrepreneurship. Scientists tried to determine what makes some entrepreneurs successful, while others must close the door after a few years. The research lasted for decades and studied thousands of entrepreneurs. The conclusion was that the successful entrepreneurs did only two things differently: they got started and kept going.

Success leaves clues.” – Tony Robbins

Success is nothing more than a few simple disciplines, practiced every day.” – Jim Rohn

Yet, like Tony and Jim, I believe there is a finite number of timeless universal principles which allow for success in business.
I tried various ventures in the last decade.
I failed at some.
I succeeded at others. I also had a unique insight into businesses of my coaching clients.
And I found what separates successful entrepreneurs from those who went out of business.


Not all the successful businesses stick to all the principles.
Not all failed businesses ignore all the principles.
And at various stages, there is different level of importance of each of the principles. #1 is absolutely crucial for solopreneurs, while #7 will do not much of a difference for them.
#7 is extremely important for matured businesses, while #1 (at least when it comes down only to the owner) might have been no issue at all.
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