Profit First
by Mike Michalowicz
Michalowicz inverts the accounting formula: take profit first, then run the business on what is left, using separate bank accounts to force the discipline. It is behavioral finance for small-business owners, written simply and with humor. Accountants quibble with details; owners who follow it stop running out of money.
Read it if…
you own a small business that is busy and somehow never profitable.
Skip it if…
you are an employee; the system is for business owners.
Three things you will actually use
- Set up the five accounts and allocate twice a month.
- Start with tiny percentages and increase quarterly.
- Run the business on what remains.
Do this first
Open a separate profit account and transfer one percent of every deposit into it starting this week.
Our verdict
Simple, behavioral and effective; the cash-flow book for small owners.
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