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Building An Empire With Bean Ninjas Founder Meryl Johnston | ProActive Podcast by MeMedia #125

 

In 2016, Meryl Johnston founded an accounting business that now has roots in Australia, Serbia, the Philippines, Amsterdam, the UK, and the US. On this episode of the ProActive Podcast, find out how she built the Bean Ninjas empire while retaining her core value of ‘freedom’.

 

Video Transcript:

 

- [Announcer] Welcome to the proactive podcast, brought to you by Memedia.

- G'day world, Chris Hogan coming to you from Memedia studio here at Burleigh Heads for episode 125 of the ProActive podcast. And today I have with me the founder of Bean Ninjas, Meryl Johnston. How are you?

- We're doing well. Great to be here.

- Thank you for joining us today. So, a little intro Bean Ninjas is your go-to accounting firm for seven figure e-commerce businesses looking to scale. Bean Ninjas understands the bookkeeping challenges related to selling online and dealing in multiple currencies. We're familiar with, they're familiar with Stripe, PayPal and platforms like Amazon, Shopify and WooCommerce. They believe in freedom for their clients, their team and their community, so they can live their best lives and have control over why, where and how they spend their time. They exist to empower hundreds of e-commerce entrepreneurs to achieve financial independence and live their best lives. So Meryl, how did you come to discover that this was your purpose?

- We definitely didn't realise that in week one of the business. In week one we were really, well, even in the first couple of years, we were really just focused on trying to make things work and get the business up and running, find customers and really make a go of it. So we weren't really thinking about purpose or values or anything like that. And in hindsight, maybe we should have but that was something that I learned about along the way. So the original purpose was really quite selfish. It was more about my business partner and I trying to create our best lives. And we wanted to create a business that we were proud of, doing great work, where we were working, our goal was less than 20 hours a week, and be out for work from anywhere and run a seven figure business. That was what we were aiming for in, in year one. And then we started to realise, well, that's not particularly inspiring for our team. How does that help them in any way? That's not particularly motivating for our customers. We're here to work with them and help them but let's kind of peel it back and really dig into why we're doing this. Yes, we're doing accounting, but what are we trying to help our clients achieve? And so it was an easy and ready process. So that's probably version four of all that process. So in year two,

- And you found it in 2015, so you've done it nearly every year.

- Yeah, pretty much.

- Yeah.

- So we started, yeah, as I say, not at the beginning of the business, but once we started to grow a team, we did an initial workshop and brought the whole team in from different time zones, via Zoom to really talk about our values and why we're in business. And then every year we do that same thing and discuss it and try and think through, well, do these values still align with what we're about? Does our purpose still resonate? Have we evolved? And so that's where we've got to now. But I think what underpins it is freedom. That was originally one of our values. And we realised it was our most important value. And eventually that became our purpose. And the way that we got to that was that as accountants, we're helping businesses, people with their finances and we realised across our client base that really the founders we were working with, business owners, they wanted to become financially independent not so they could drive their . Those, I mean, some of them do, but really it was about creating time. It was giving them control. So if they could build that financial independence, then they could spend time with their family, they could go surfing, they could travel, they could really leave the life that they wanted. And that's something that as business owners, we wanted for ourselves and we want that for our team too. To have flexibility and enjoy work and doing great work but enjoying everything else outside of that. And so that, as we discussed it over the years and we talked to our customers, we talked to our partners, we realised that's really what we're about. And that we're in the business of helping people on that path to financial independence but so that they can live a great life.

- Yeah. Fantastic. So what I'm hearing is that you, like most businesses aren't aware of really what your customers wanted from the get-go. And to reiterate what you said a little bit selfish which is fine, absolutely fine. But it was so great to hear that you've analysed the market, which you serve and put them first because they don't really care about what your dreams are. Right?

- Exactly.

- You do, they only care about their own and who can help them achieve that and what solution you provide. And so therefore you've been market led by analysing the market and hats off to you hence why you're across multiple time zones. So Gold Coast founded, and now you're international. Where do you have team members?

- We're spread around in six different countries. So the primary market, where we have customers, Australia, the US and the UK. So we have team members in those three countries but we're always, we're a remote first team that ties back to our original goal of being able to work from anywhere. And so from the beginning, we hired people whether they were based on the Gold Coast or not. So we also have a team in the Philippines. We have a couple of team members in Europe, in Serbia, and then also one of our Australian accountants lives between Barcelona and Amsterdam. So we're spread out around the world. And that doesn't come without its challenges in working and collaborating across multiple time zones. A team management meeting is pretty hard when you've got Australia and Asia, US and Europe time zones. It's very early and very late for someone but we just figure out a way to make that work.

- What's one of those ways, is what, how is technology helping you there and maybe help the listeners on what that platform is that that is helping you or platforms.

- We do, so if we're doing team calls like that, like the management meeting, then we're doing that via Zoom. So we are all online together but really it's forced us to think about asynchronous communication, which is really about how, so if you and I were on 10 hours apart, how can we communicate if we can't be on a call regularly at the same time? We use a tool called Slack which is an internal messaging tool and we use Loom. So we record a lot of videos. So if I'm rather than getting the whole team together every month for a team update, I find it easier to record a video and then people can watch it at a time that suits them and people can comment and reply back. So we're big fans of asynchronous communication. And we read a lot of the Basecamp guys, write a lot about that and so we've learned from them around how do you implement this into a business and encourage people to be thoughtful in their communication rather than expecting instant reply and shoot off messages quickly which is what can happen when you're using tools like Slack.

- And I think that's what the multiple time zones actually helps do. They can't just shoot off a quick message and all of that sort of stuff. And they have to be a little bit more prepared. I would use the term proactive, in their actions so that they need to do something now. Well, they need to be prepared for that. So.

- That's something that when I was creating training in the early days, think about if we're trying to get something out to a client quickly and we're interacting and need input from different people, if I ask you for something I need to be very precise and clear with what I need. And I need to think about, well, what questions may you have about this communication? Because if you reply back and then it's takes us three days to get to a resolution that is a bad outcome for the client. So I need to think through, have I given you everything that you need to complete these tasks?

- Yeah, absolutely. I'm a big fan. I can't say I'm personally that well organised. I am trying to be better every single day. And I think the whole be ProActive motto that of course I learned from Stephen Covey. It's the number one habit, of the highly successful people, is to be proactive. Adopting that in myself has actually made me better. I'm still not perfect, I try every day to be better. Slack, amazing tool, we use it here too. And also recording videos I think is fantastic. Do you then go and minute those so that people don't have to watch the whole video and then they've got their action points and all of that sort of stuff.

- It depends what the video is. So we do video. If we're creating standard operating procedures, then we trot, we have a rule of keeping videos on the 10 minutes. And so then that will go into, we use suite process for standard operating procedures and if was designed to be transcribed, there'll also be a written version because some people prefer to watch things when they're learning, some people prefer to read. And then I think what's really important is to actually, putting it into action. So that would be one example. If it's something like a team update

- Do you write that procedure, as well as do the video.

- Yeah, well, like a summary. So if someone went in, so we have a video, a simple procedure might be how to set up a Zoom meeting. And so you can watch a video of someone doing it step by step, but the procedure wouldn't transcribe everything. It would just have the key points, Create an account, invite someone, send the link. Yeah, so that's more just simple steps to follow.

- Yeah, great.

- So that's one example with something, sometimes I'm just providing feedback on something. So it might be a report and then it's easier for me just to go in, as I'm reading it and then provide that feedback. So that wouldn't be transcribed. Something like a team update we'd prepare it. Me and my business partner would prepare slides. So we'd share the slide deck as well.

- Great. Super organised.

- I suppose, we're accountants.

- Fantastic. I think these visionary people over here is creative. As you know, we like to be a little bit too loose, with things and yeah, could definitely use what do they call them, integrators.

- I'm right in the middle with that test slide probably maybe more slightly on the integrative side, but pretty close to the middle.

- Yeah. Right. I'll be honest, I can't remember where I am in that sense. I think it's definitely more visionary. So who inspired you earlier in your life to, I guess, live your personal purpose or live your life how you're living it now. You said freedom's important to you. So who gave you that value?

- It was actually my parents. So my dad was the original lifestyle business owner. And I never knew the term lifestyle business until recently, but I look back at the kind of business that he ran and that was that business. So my parents ran, my dad was an engineer and my mom was an accountant. And so they teamed up and dad did the engineering and my mom kind of ran the business and they didn't try and build a massive business. They didn't have employees. They worked with a team of subcontractors and really it was about creating freedom and us being able to go out skiing or to be able to take holidays and for dad to be able to come and watch our tennis matches or school assembly. So, and I didn't necessarily appreciate that at the time. That was just how life was for us. And we'd talk about business at the dinner table but also we had a lot of flexibility to go camping and to be involved as a family. And so I saw that and I was always interested in business but it was only as I started to run my own businesses that I realised, right, that was a conscious decision of my parents to not build a massive empire, but to build a business that met their life goals. And while I did, wanted to build something bigger than what they had with the team and a brand, I also wanted to keep that lifestyle front and centre as well around why am I doing this.

- Fantastic, what an awesome lesson to learn. And yeah, it's funny how you just don't appreciate it. You don't, you're not very grateful when you're younger for these things and experiences that I guess you're partaking on that become lessons that you learn later in life. You know, you learn them early, you don't get it until later you go, hmm, hang on. Is Bean Ninjas your first business?

- It's not. So I've had a couple prior to Bean Ninjas. When I was at university, I had a tennis coaching business. So that was the first, I wanted to run a business that was the only skill I had to sell. So I hired some other university students and ran that business for a couple of years until I graduated. Then I worked as an accountant for many years. And before starting Bean Ninjas, my exit from employment was running a consulting business. But I actually just packed up and left my last job that I've had enough, went travelling. And then when I came back, though, all right I better get something organised or I'll start a business.

- Right on, right on. I did the whole, don't get let go of one rope before you got hold of another one. So built my business on the side until,

- That's probably a far better idea.

- Well

- I mean, this option forced me to get customers very quickly, possibly more stressful as well.

- Yeah. Yeah. Did you have a mortgage and kids at that time?

- I didn't have a mortgage, I didn't have kids and being an accountant, I'd saved up about a year's worth of living expenses. So I had a bit of a financial buffer, but it was still stressful.

- Savings. What are those guys? So good on you, well done. What would you say was, I guess, the most important part about that start? What was it that you had that allowed you to do that? Was it the savings or was it the experience?

- I think it was just hustle. I was just gonna do whatever it took to get customers. And I didn't really, I didn't know anything about marketing. I didn't know anything about sales. All I knew was accounting. I mean what I'd learned around the dinner table 10 years ago when I was talking to my parents and then starting that tennis coaching business. So I just tried everything. I did door knocking, I did cold calling, none of that worked but I just tried everything, fliers. This was before I learned about digital marketing. So I was trying those strategies, I was trying building referral relationships, didn't work out for me, got into writing content, but that took a couple of years to pay off. So I really just tried everything and I was just gonna do whatever it took to make it work and get some customers through the door.

- So what did work? What got your first customers through the door?

- So with my consulting business, it was often through relationships and that took time. But just letting my friends and family and my network know, hey, I've started a business. This is what I do. I was just leveraging the accounting skills that I'd built. So this is the kind of accounting I used to do, does anyone need any help? I can come in and I used to work in audit so I can help your business prepare for an audit. I was just basically doing anything. There were different websites where there were ads, posts of people wanting accounting work done, a bit like Upwork in Australia. And so I was hunting through those and trying to pitch people. I was also looking on SEEK and seeing if there was an accounting job and then I'd pitch them my business instead of hiring an employee.

- How did that work?

- It only worked for me once.

- How many times did you try?

- Many. Yeah, I probably applied for about 50 different jobs and I would pitch them that they could get me and my business for a cheaper price than as an employee. And then I would, I had a team which I was gonna hire if I got the job.

- Yeah. That's a cool one. I've always wondered about that one myself and thought about, hmm, that's a possible angle I could take here but never done it.

- The one that would actually, so they had a person that had left as the finance manager but they weren't actually hiring the full-time role. They just wanted someone to come in and fix a bit of a mess. And so I fixed, quoted that job. And then I said, hey, you used to pay this finance manager 70,000 a year. I'll do the same job for 35 with me and my team in India. And so did that for about a year until I realised I'd automated everything and that they didn't want to pay that fee any more.

- Oh, come on, come on. That was your IP there that was worth well more than 35,000. So hope you got at least a few years other than that one. Automation's an interesting thing, isn't it? So you use your IP and your skills to go and implement that. Should they have paid that for more than maybe the term that they were on? Do you think?

- I like to think so, but I look back and think, well, I was not communicating my value well enough. So they were comparing, they were looking at costs and they were looking at how much time that they thought that it would take me and the fact that I had a lower cost team than previously that they were paying. And I just wasn't communicating, I wasn't providing value. I wasn't managing that relationship well enough. And I should have been more proactive in monthly meetings and talking about all that we were doing behind the scenes. So I feel like, yes, it was unfortunate that didn't work out, but that was on me. I didn't really run that job well enough. And I was pretty inexperienced at the time. So now I think a lot more about perception. So where's the perceived value. I know what I'm doing, but if a lot of that's behind the scenes then how do you create an ongoing perception of value?

- Yeah, I think that's a really good point. And I think that's something that I've learned as well, like with our clients. So we have weekly meetings with our clients. We effectively are a plug and play marketing team and being, if you're a internal marketing team, then you'd be meeting weekly, right. Going, what's going on, et cetera, et cetera. And so that's what we do here. And yeah, works really well. We become ingrained in people's businesses just like a marketing team is. So it does communicate the value very well and solving problems that people have on the weekly. It communicates great value, right?

- Yeah, and I think some people say, well, I haven't heard from my clients recently that that's a good sign, they're not complaining. But I think, well, hang on you might not have heard from them for three or four months but you don't really know what they're thinking. Maybe they're thinking, ah, I don't know if they're providing value anymore and they're just about to leave. So I'd prefer to be proactive in over-communicating.

- I love that you're selling my methodology. That's fantastic. So values, I really like to dance around these values. You said, just before we got on that, you played sport. And I was first wandering like around that sporting time in your life, younger years, what part of that may be instilled some values in you that you still use today?

- I'd say there's quite a few. So I used to play, I played a lot of sport, but tennis was my main sport and that's mainly self-empowered until you get up to the higher levels. And so for me, a lot of that was about honesty and there were a lot of kids out there, they would get into state and national teams through dodgy call here or there. And for me, my reputation was far more important to me than winning a match with a few dodgy calls or building, though kids that had reputations for cheating. And so that was something that I struggled with ongoing with, hang on, some of these kids are known as cheaters. There's no one there to, they're not really getting pulled up and they're getting rewarded for that. So that was the conversations I had with my parents about figuring out early on, well, who do I wanna be as a person? And I'm gonna stick with, sometimes the harder path, but that was important to me to feel like I was always honest and fair. Something else was discipline. So when you're training for, I think the better you get at something, the harder you have to work to make incremental improvements. And so as a tennis player, there was a period where I was training six or seven days a week, sometimes training twice a day and really trying to make those incremental improvements, trying to play club tennis, paid and professional professional tournaments and really committing to that training plan, getting stronger and sometimes not seeing results or not getting the reward from that but just sticking at it day after day for years. So I'd say discipline, and then always having fun 'cause I think you can do the hard work but then there also needs to be a reason that you're there. And knowing that I was probably never gonna be a full-time professional tennis player then why are you doing it? And having that aspect of fun and enjoying the journey and the friendships along the way. I'm still friends with some of the people I grew up playing tennis with years ago.

- That's fantastic. So I love the one on being honesty. I'm a big believer in that too. And I've been thinking about this a little bit with regards to white lies and how they like, does that mean if you value honesty, does that mean a white lie is, I guess, going against your values and what do you think of that?

- I absolutely think it is. So I'm massive on not telling any lies and really try hard not to do that. So I think Mark Manson in his book, "The Subtle of Not Giving a F*ck" says, there's a section there where his wife,

- What was the name of the book again?

- Am I allowed to swear on this podcast?

- Yeah, go for it.

- "The Subtle of Not Giving a F*ck."

- Oh, yes.

- Yeah.

- Yeah.

- So there's a section in there. I think it's his girlfriend or his wife, and saying, do I look fat in this dress and he says if she does, then you should say yes, and you're probably gonna if you say that but trust is more important. And if you're going to tell what that's probably, a white lie, if you said, yes, you do look good, when they look terrible, you're not building a relationship on trust. So I'm a massive believer in just try, always try to tell the truth. And sometimes it's very hard to do that but I always really try. So if someone, if you're invited to an event, some people, and you don't wanna go, some people just make something up. Ah, no, my kid's sick or make up an excuse. That's a lie. And this was something that my dad said early on, you don't have to give people a reason. You can just say, look, I'd love to come but I can't. If you don't want to go then you probably shouldn't even be saying that you would love to go. Just say, look, thanks for the invitation, I appreciate the invitation, I can't attend. So I've been reading another book recently called "Lying" by a guy called Sam, I forget his surname. But again, the same kind of thing. Like where is the boundary of a lie? And I think sometimes I can't avoid lying but I try very hard never to tell even white lies.

- Yeah. That, I guess that profile that we need to like uphold and our brand, our personal brand and has something that's happened, depending on the way I put that towards the other person, is that going to seriously impact my brand? If I tell a lie around it or the truth, sorry, the truth around it. And do I need to, mould it into something a bit more easier to swallow. I am also exactly the same and I've read Mark's book. And I think I was already like that before I read it. And I was like, I'm on board already. Give me that book. I also think, being of service to people, if you're just telling them shit they wanna hear, right. How are people expected to grow? If you just go, oh, you're great, all of the time.

- And your word doesn't mean anything. 'Cause if you just say, someone looks great every time, then they go eventually I think, well, you'd say that. So maybe you didn't mean in any of these times whereas if the relationships built on trust, then when you do say someone looks great or that they've done great work, then they'll actually go, Oh, that means a lot coming from you because I know that you're being honest with me.

- Fantastic. There was plenty of other values in there. Discipline was one of them, fun was one of them. And I don't like those line calls cheaters either, but look, if it was easy everyone would do it, right? Just around the value sets that you've, I guess, that you share with your team. I have this belief that we have to share at least three of, probably the top 10 values that people have. We have to share them and they have to be like pretty clear cut. Like, Oh, you could say that that word means that. It has to be like, yes, it's a line call, sometimes, but if we don't share at least three values of our top 10, then I think there's gonna be trouble. Like when the storm comes, when the shit hits the fan and you absolutely need to work with each other and take feedback on and you don't share the same values then, I believe there'll be a clash there and potentially relationships will suffer. So is that something that maybe you've experienced? 'Cause it's great that you've done this work with your team. Do you have any input on that?

- Yeah, so we have the three core values and I think values come down

- You just have the three?

- Just three.

- Why?

- I mean, we came up with a massive list of them when we were discussing it but we realised we wanted to pick three that we could just talk about all the time, tell stories, give examples of behaving in this way. And I expect everyone in the team to be able to tell me what our three values are. And whereas if we had more then maybe that would become harder.

- Now that's really good because there's actually like a theory that we can only keep a maximum of four concepts in our random access memory. We can only memorise a maximum of four. So if you've got three that's even easier.

- No excuses, Bean and his team.

- Exactly. That's good.

- Yeah.

- So what are the three, it's freedom?

- So freedom, always growing, which is about continuous improvement and taking feedback. And then our third one used to be trust. So it's spelled fat, someone in the team told me. But we realised we're afraid we'd drop the G. Freedom, always growing and trust.

- Got it.

- So with trust, we realised we should be behaving like that anyway, it shouldn't, that should just be expected of us. So it shouldn't necessarily be a value. So we changed that to do the right thing. And I think that's very self-explanatory. And the way I think about values is if you're in a situation, then our values dictate the decisions we make. So that's the lens we should be looking at a situation and we can ask ourselves, are we doing the right thing here? Maybe there's an easier option, but are we doing the right thing for our team, for our clients, for our community and the same with always growing. Are we actually taking on feedback? Are we trying to learn, are we continually testing ourselves and doing the 1% that are gonna make us gradually better. And so that's the lens that I look at values from.

- That's really good that you've distilled it down into three. 'Cause there's so many underlying values that go with, are we always learning, like, say honesty if you value honesty, do you respect when someone's being honest to, with you? Yeah. When you said FAT, I was like, Oh, you must be saying P-H-A-T.

- We didn't intend it to be like that. It was just somebody in our team said, ah, now I've got a way to remember. It I'd want everyone to remember. I didn't have that in mind.

- You should have gone pretty like, we are FAT. Awesome. That is great, but I want to go through that. There's too many to remember. So Gold Coast based, How did you actually reach out to those global team members and bring them on?

- So I think our first overseas hire was a US CPA and that was, but the intention was always to build a global business, but we thought, well, maybe we'll do that in five years or 10 years. And then in year one, we actually got enough referrals from the market segment that we ended up in, which was online businesses. It's like bookkeeping for my businesses, where they had friends who were saying, Oh, book keeping, we just doesn't understand this online world and multiple currencies, they're getting it, it's a real mess. We've heard that you've got this Australian bookkeeper. Can they help out? And so we had enough referrals, we thought, okay, let's try things in the US, so we hired a part-time CPA in the US and that kind of evolved from there. And that's our actually our biggest market now. So that was hire number one. I mentioned that the team in India, which was in the very early days, that did not work at all out as standard operating procedures and checklists processes were not that we knew what we needed to have an offshore team. So we scrapped that. And then about three years into the business, we started hiring in the Philippines and that was mainly through jobs spots. So it was, now we use online jobs.ph but it was Upwork back in the day. And then a lot of it was through referrals. So our team in Serbia came from, I think someone that had followed me on LinkedIn met someone from the Bean in this team in Bali and then evolved that way. And we've had a couple of team members that just have read articles about Bean Ninjas in accounting industry magazines or heard me speak, and then just applied for jobs that weren't even open or they weren't suitable for, but super talented people. So we figured out a way to get them on board.

- That's amazing. And I think what's amazing about content marketing. That's sort of our bread and butter and something we're very good at and how, if you're putting out like great content, enough content that people can digest, at any time, in any way they choose then they come to know you and like you and trust you enough to go, hmm, well, I'd like to work there. We get in bounds as well. It's really nice. I think it actually says something about your business. If you're getting inbound, people wanting to intern with you, people wanting to work like so funny that internships. People wanting to work for free with you, sometimes full time. It's like, wow, look at what you've got. Do you get that at all?

- Not so much with the interns. Maybe we get a few, but it's more from accountants that previously, before COVID couldn't work remotely. And so they knew that was a part of our culture and wanted to do that or they just wanted something a bit more flexible and modern than the options that they had available to them. And we also think about our brand as an employer brand as well. Because people have said to me, why do you bother speaking at accounting industry events, or getting featured or building a relationship with chartered accountants? I'd say which is maybe our membership body. So I will, actually an employee brand really important too. It's not just about customers. And I probably won't get any clients or customers speaking or writing for publications or events like that, but attracting great people. We are people business, we're a service business. So that's critical as well. It's having a pipeline of the right people. So that instead of thinking, oh, we need to hire for this role and in six months later finding someone, you've actually got that pipeline full, you've even had conversations with some of these people. So when the opportunity comes up, they're ready to jump. So I think about content from that perspective as well as the core focus which is about creating content for potential customers.

- Fantastic. You said that you wanted to be a global business from year one.

- Hmm.

- How did that feel when you first said that?

- That was just part of the goal setting. So when I say the goal setting, I was running my consulting business. I'll give you a little bit of the origin story. So I was running my consulting business and I set up Bean Ninjas with a guy called Ben and he ran a tax practise and we were in a mastermind together talking about our vision for the future, what kind of business we wanted to run, the problems with our current businesses. And I was also involved in the startup world and going to startup weekends and learning about that kind of methodology. And I was in a co-working space with a guy called Dan Norris from the Gold Coast who is running a productize service called WP curve at the time. And he was kind of pushing me to try to do that in the accounting industry. So I was thinking, I had influences from these different areas and Ben and I were thinking about, well, actually maybe were a good fit. We both want to build something similar in the accounting industry. Let's write out our criteria of what this business might look like. What we we'd be looking for. And it was build a brand, not have something based on our personal names, recurring revenue, not always projects. We wanted to have systems and a team rather than us doing a lot of the delivery. And we wanted to have global potential. I think just 'cause it sounded cool. Because that's what they say takes tech startups, is there a big enough addressable market? Can this go global? And so I thought that was what was important at the time. I wouldn't necessarily think that now, but that was on the original criteria list. And so when we were picking a business, and we needed to get something with a .com in the early days, and then it just kind of evolved that there were opportunities there. And I think we're lucky now we've specialised in e-commerce and e-commerce businesses by their nature sell into multiple countries. So an Australian business that's doing well, they've created a great product. They've tested the market here. Then next move is usually selling in the US, and then going into Europe often visa the UK. And so we just ended up, this was no great planning on my part but we just ended up building teams in those countries. And so we're one of the few non big four accounting firms, I know that can look after an Australian e-commerce client in all of those countries. I wish I could say it was great planning but it just ended up that way.

- Yeah No, that's fantastic. I mean, it's something that I do know that happens is that everybody wants to be a global business. They wanna save the world, right. Especially when they're talking about their purpose and it's funny that that's what they want from the outset but then, it's such an ambitious goal that after a period of even maybe just six months or 12 months of going at it hard and not seeing actually like enough movement or enough impact being made to fully understand, wait a minute, am I actually impacting, am I saving the world? Am I gonna be able to save the world? And then anxiety sets in because it's like an overly ambitious goal. Being focused on that. Whereas it came about for you, it was something that was on the list and yeah, I do think I agree, we should actually operate businesses with the potential of being able to go global. I think that's absolutely right. And yeah, look, we're the same in that in that capability and the capacity to be able to do that. So,

- But I like where you are going with that. And I think sometimes, and I think the startups scene, unfortunately, particularly the tech startup scene encourages that too much. You must think big, you must be the next Elon Musk, Steve Jobs. Honestly, reality, you're probably not. So maybe there's one or two people that are like that but you can solve a problem for a group of customers and build a great business, build a great lifestyle and have an impact in a smaller way and feel really satisfied and live a fulfilling life. And I think that it's a bit of a myth and something that's overly ambitious and sets people up to fail, is that we must save the world or building something world changing and global. Maybe when you're 10 or 15 years into your entrepreneurial journey, you've built, you've got capital, you've built a network, you've built a skillset. Then maybe that's the right time to try something super ambitious like that. But why not just start small and gradually build up your skillset and feel proud of your accomplishments along the way instead of always feeling like you're falling short from a super hard goal, that is pretty unrealistic.

- Couldn't have said it better. Well done. I'm gonna transcribe that and put it in the book, look out quote, Meryl Johnson.

- Might not be a popular opinion, but I think more people need to see it.

- I don't think it is popular. I don't think it is popular. Like that's why I'm having this conversation with people. They're feeling crushed by the fact that they're not able to change the world. One, people don't even know what their personal purpose is. I have this conversation with people all the time. I call it having a conversation where I'm really doing a social experiment. Yes. Sorry people, I'm gathering numbers. But it it's true. Like, what's your personal purpose? I don't know. What's two things I have to know about you in order to fully understand your, who you are and it's just this blank. And I think, but then there's people that are going like under 25, I go, they're anxious because they don't know their personal purpose. And then like, they feel like they have to know they've their life purpose and unfortunately that's creating like mental health issues. And so,

- Oh yeah. I think part of the problem, if I think about politicians or media, they're looking for interesting stories and someone that's building a boring business, maybe it's boring, it's not the next hop tech thing that's changing the world. Would you prefer to put that in your article or in a newspaper, or would you prefer to someone that's gradually doing things, taking their time, gradually making an impact? That second story is probably never going to get into the newspaper. And there's lots of people doing that, exactly that. Maybe it's a bit boring but it's a successful well done business, solving a real problem for real people. And I think the same, if you look at politicians, they want a flashy story. That's gonna make them look good, not necessarily something with good sound business fundamentals that maybe isn't as great a story.

- You can blame the media companies, sorry. We have to have a great story but there's all these great stories in everything. That boring businesses like accounting, I didn't say that, they're boring businesses. Absolutely, they're solving problems for people that are problems worth solving. It's not the next, coffee app that stop you from having to line up in a queue. It's meaningful stuff that helps people do things either in more efficient way, all those sorts of things. So, yeah, they're somewhat boring, but you're right. If there is this feeling that if it's not gonna, if it's not big enough to get in the paper, then it's not good enough.

- And it doesn't need to be like that. I like to work backwards from what your personal goals are. I think similar to what you're talking about with personal purpose. And so you might figure out the way that you want your ideal life to look and how much work, but also how much money you need to achieve that. And maybe your business doesn't actually need to be huge to achieve that. So it might be possible not just to serve customers in Australia, you might be able to achieve that just based on the Gold Coast or in Queensland. And so you might not need to shoot for something bigger than that, you might be able to achieve your personal goals with less. And so I think that's important to match, well. like what you're talking about with personal purpose, try and align the business with that and not feel pressure that other people are generating millions of dollars of revenue. That's great. And that might fit what they're aiming for, but really, what do you need to make you feel fulfilled and happy? And it might not be that.

- It's probably just a profit, right? It's probably profit because if you're running a business that's seriously not making profit like year in, year out, that is gonna be sold as stalling.

- Absolutely.

- Yeah. What being, okay, we've got an accountant in the room. What percentage of profit should people be making in order to have a sustainable business?

- Yeah. This is a great question. There's two types of profit, I like to think about. So there's gross profit and net profit. So if we're thinking about gross profit and I'm selling these cups then there's the cost to produce the cup. So say I'm selling this for $10 and it costs me $3 to manufacture it. Then my gross profit is $7. But then I've got all of these other costs associated with running the business. I've got my accounting fees, I've got marketing, I've got an office or warehouse. And so all of those other costs then come off to,

- Cost of goods sold.

- Yes, the original, so the cost of goods sold was to produce the item and then the other costs like overhead costs. And once you remove those, you're left with net profit. So we're selling it for $10. The cost of goods sold is three, our overhead costs are another three, and so we're making $4 net profit or 40%. Now that's very high for a product business. And it depends on the business model. So service businesses will have different margins to physical product businesses compared to digital products or compared to SAS. So if we look at SAS, sometimes they might have something like an 85% net profit. Ridiculous.

- We had Jason Atkins from He was just going on about that, it was crazy.

- Which is why they get great valuations. And there's a lot of people trying to build SAS or other tech-related businesses. Whereas if you look at a service business, a good net profit for them might be something between 10 and 30%. 30% will be on the very higher side. I mean, there's occasionally businesses digital agencies that are doing better than that. If they've carved out some kind of unique market for themselves or they've managed their costs. And then we've product businesses, it can vary as well but generally less than a service business. So if you're selling a product on Amazon that you don't make yourself, your margins might be tiny. It might be more like at 2% but really I'd say you'd want to be aiming more for around 10%. So these are very rough rule of thumb numbers that would vary that there's a lot of factors to consider, but that's, I guess having a rough guide is helpful.

- That is very helpful. Oh, I heard something many years ago when I was doing business studies and whatnot that if you were making 15% profit, it's not a matter of if you're gonna go out of business, but when what would your response be to that?

- I think that might be based on not separating out the owners pay. So if you're, I like to think of a business as an asset, and you've got two roles as the owner or the founder. So you own the business and you should get paid in the same way that if you own shares, you would get paid dividends for the risk of owning that business. And then if you work in the business, which most small business owners do, you should get paid a market rate for the work that you do. And so that should come out first and then your net profit is left. So I think a 15% net profit, if you've already paid yourself, the market rates, so say you paid yourself a hundred thousand, that's been taken care of and then you're still taking home a profit after that and say, it's 15%, I think that would be, I mean, I'd probably like high up it but it would still be sustainable, I would say. But if you hadn't paid yourself, then that number may start to cause problems especially if your revenue's low.

- Awesome. Just got some free advice. Hey guys, I think that was fantastic. And it's a conversation that I wouldn't be able to have with people. So I really appreciate you sharing that, it's great. What's in store for Bean Ninjas now? You said you're in the UK, you're in the US what are you going to go, multi-lingual? What's going on?

- Well, I think tax. And it's something I said, I would never do. We started as a bookkeeping business, so we're processing transactions. And then all of our clients had their own accountant that then did their income tax returns, helped them with their structure, that sort of thing. And I never wanted to go down the path of running an accounting firm and tax. I was trying to build this scalable product type service. But what happened,

- But?

- Yes. But I looked at what our customers wanted and people who didn't go with us, they went with competitors and tried to understand why is that happening? And I heard over and over again, we want someone that can do tax and bookkeeping. And often the third, that third piece of that triangle is virtual CFO, CFO advisory. So, who can look at these numbers and then help us make right decisions. And that was kind of the triangle the three things that clients and people that weren't working with us wanted. And I heard it time and time again until I thought, right, we need to provide what the market wants and we need to have tax. And so we did that first in Australia. So we went through a merger acquisition process in December and an Australian tax firm has just come on in Bean Ninjas Australia. And so we were testing that here. And then that's my project, next is through acquisitions or mergers to do the same thing in the US and UK over the next couple of years.

- Fantastic. Once again, listening to the market. And it's funny, when you're listening, when you're hearing these, you gotta be conscious of it. You know, it's like, Hmm, I said, what? Okay. And then the first time you hear it, like you say, you didn't actually do anything about it. What do you reckon? How many times do you reckon you heard it before you actually went, oh, okay, I got to do something here.

- I probably heard it maybe four or five times but then I did some customer interviews too. So I wanna know if one of our good customers left, then I would understand why. And so I tried to have good relationships that I could have those honest conversations. And one guy in particular did a detailed call with me to talk it through. And he left for this full service option where he could get all three things. He was really happy with what we were doing but he wanted it all under one roof. So I'd heard it a couple of times. I did the deep dive there. And then I also started to talk to people in the industry as well, the accounting industry and hear what their customers were saying.

- So 10 plus, easily 10 plus.

- I probably heard it, yeah, probably 10 plus times.

- Yeah. And that's what we say, it's funny. It doesn't have to be huge numbers. 10 plus is basically where are at normally when we need to understand our market's needs. So fantastic Meryl. Is there any plug you wanna do for your business? How do people stay across what it is you're doing, that service is coming soon or it's already implemented and tried.

- It's already in Australia. So we're up and running. So now we can do tax based businesses as well as the bookkeeping and the advisory piece, which is forecasting. If you run an e-commerce business or you're friends with someone that does and you're looking to scale or expand overseas then, and that's what we specialised in and love working with e-commerce businesses and founders like that. You can find us at beanninjas.com, and I'm also pretty active on LinkedIn and just getting started on Twitter but I'm also there as well. So and that's just my full name on both of those platforms.

- Fantastic. Thank you so much again. Thank you all for watching. We are available on YouTube. You can search for the ProActive podcast there, we're on Apple, we're on Spotify. And if y'all can't find any of those, jump on memedia.com.au to check out this episode, obviously, and many others. We've got so much value that we offer there, I believe. And because conversations like this are just amazing and keep watching guys. I really appreciate your support. Just your comments and the fact that you're even watching is enough for us. It really floats my boat and it helps keep the team, I think, believing that we are making a difference in our community. So thanks again. This episode was brought to you by getmeava.com. Somebody that I spoke to about that just only a couple of days ago told me that they were so busy in their business and could not handle the amount of workload that were doing. And we said, why not use what, look at getting a VA? We actually have a VA and we use getmeava.com. So if you feel like you need someone to help you with those admin tasks, or maybe even your social media sharing by all means, check out, getmeava.com. Cheers.

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