Managing Cash: The Right and Easy Tool For Cash Flow Management
Updated: Feb 13, 2022
Whether you’re still in the planning process of starting a business or already in the middle of it, cash flow management is a concern. You won’t be the first entrepreneur to struggle with finding the right tools for managing the cash flow of your business.
It’s true that business owners are putting a lot on their plate — and a lot at stake — when running their own company. Thus, an effective cash flow tool is crucial to reduce the risks of mismanagement.
In this episode, Sarah Isaacs, the co-founder, and COO of NorthStar imparts the benefits of implementing the right financial tools for cash flow management. She recalls how Dryrun helped her establish her own business. Finally, Sarah shares the features of Dryrun that contribute to her company’s development.
If you’re looking for ways to handle your business’ cash flow better, then this episode is for you!
Here are three reasons why you should continue reading:
Discover the importance of using the right software to monitor your company’s cash flow.
Understand the significance of flexibility in cash flow management.
Learn how Dryrun can help you and your company’s cash flow management.
Managing Cash Resources:
Visit Christina Sjahli's website for more insights on designing an ownership structure that aligns with your company vision, and check out the Her CEO Journey™ podcast series!
Sign up for the free 30-day free trial with Dryrun to see how you can monitor, manage, and model your own company’s cash flow!
Connect with Sarah: Twitter
[04:25] Sarah’s Journey to NorthStar
Sarah worked in a team for a large global cybersecurity vendor that offered professional services to enterprise-sized clients. Her main task was to find qualified third-party partners to assist with their client’s delivery of technical services. However, she struggled with it.
Despite her struggle, she later discerned that she could perform the task better. The realization motivated her to establish NorthStar.
[05:30] What is NorthStar?
Sarah, along with her business partner, Alex, runs NorthStar. The focus on vulnerability prioritization, a significant cybersecurity problem. Anything that uses technology like computers, phones, and printers is vulnerable to cyber threats. Therefore, patching them is crucial.
“Everything that you use, whether it's a computer, or a phone, or a printer — is a piece of technology that has a vulnerability. You have to patch it sometime.”
After identifying the vulnerabilities, NorthStar helps these large organizations to decide which of them they should prioritize. These priorities greatly impact the business within the organization.
“You can't be looking at a million of them [business vulnerabilities]. You need to look at the ones that really have an impact of — business impact — to your organization.”
[07:44] The Growth of Small Companies
Everything is still manageable when a company is just starting. There are more things to manage when a company starts growing in terms of people and revenue.
“When the revenues started growing, and our employee count grew, my struggles were real. They're still real.”
Cash flow and cash flow management are not an accountant or bookkeeper’s job.
[07:58] Sarah’s Struggles with Cash Flow and Management
Sarah’s anxiety worsened as her company’s revenue grew. Without proper cash flow management, you’ll experience difficulties in making present and future decisions. She regrets not hiring a person with CFO experience to help manage her company’s finance strategy.
“If you don't know how to manage your cash flow, especially your operating cash flow, your business is at high risk of facing a financial issue.”
[11:32] QuickBooks and Dryrun Comparison
Sarah explains how her company utilizes QuickBooks. It is an accounting software that helps track expenses, bill payments, and revenue and create invoices. QuickBooks relies on the historical data of the company. In comparison, Dryrun can retrieve the historical data.
"On other accounting software: “They weren't flexible the way that Dryrun was flexible. They seemed to be more of a — it was more "set it and forget it" software. An easy integration of data, good high-level dashboards, but a limited manipulation of the data.”
The purpose of cash flow in QuickBooks is often different from what the company needs. Dryrun can provide information about the company’s future in cash flow from historical data.
[13:36] Before the Discovery of Dryrun
Sarah researched and explored different options for cash flow management software. As she experimented, she looked for one that’s team-focused, flexible, and transparent. While she was on a two-week free trial, she realized that some of the software was inflexible in manipulating data. She wanted a software that could cater to her specific needs.
“I knew in my head, I had some requirements, I wanted something that was team focused.”
[17:56] How Dryrun Helped Her Business
Sarah’s company was mainly a professional services company when they began operations 10 years ago. Organizing expenses is different now compared to when she first started.
Dryrun allowed her to consider recurring revenues and the economic predictions in different scenarios.
[21:19] The Flexibility of Dryrun
Dryrun can pull information from an accounting software, and it allows you to tweak it according to your liking. The software can model the customer journey, which is a powerful tool for business forecasting.
“I think that is one flexibility within Dryrun that help a lot of business owners: they can structure the cash flow forecast inside Dryrun the way they want it, the way they see their business.”
[22:18] What Dryrun Offers
Sarah checks Dryrun at least twice a week. She ensures that the data from QuickBooks is in-sync, reviews the action lists of the upcoming bills and receivables, and monitors the cash flow totals at the end of the month.
“When we pivoted, it allowed me to think about recurring revenue, and opened up the possibilities those different scenarios, those what-if scenarios.”
[23:43] Plans for the Future
“I am excited every week, every month, I have a scheduled meeting on my calendar to input our sales projections into these scenarios, to see what if.”
The CEO has put together a plan for 2022. Her main responsibility is to execute them. When she’s on Dryrun, she verifies the budget application to her monthly plan.
The financial planning gives a rough idea on whether they would achieve their Q1 goals and the budget allocation of marketing.
“There is a forecast with different scenarios that I know is true and accurate that no one touches, that's me.”
[28:09] About AvaTax
AvaTax is a critical financial tool for Sarah in calculating the appropriate local sales tax to her invoices. The software could either pay her taxes or just record them for her to pay at the end of the month.
Based in Chicago, Illinois, Sarah Isaacs is the co-founder and COO of NorthStar, a cybersecurity software firm with a proven track record in information security consultancy. She specializes in information security, risk scoring, agentless asset tracking, security analytics, and mentoring.
Sarah has also been an advisory board member of the International Consortium of Minority Cybersecurity Professionals since 2015. She is passionate about promoting women in technology, therefore making a difference through her company for about 15 years now.
She also writes about the importance of women in technology and has been featured in Cybersecurity Venture’s “Women Know Cyber: 100 Fascinating Females Fighting Cybercrime,” which was released in 2019.
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