The most important financial skills every entrepreneur should possess. By Nick Rojas, a business consultant and journalist, written for Millo, a freelance job website. November 21, 2018. Lists and describes the following skills:
- Understanding Credit
- Budgeting
- Project Management
- Investing
- Borrowing
Accounting for Entrepreneurs: 5 Skills You Need to Know. Written by Staff, Harvard Business School Online lists the following skills:
- Managing cash flow.
- Managing a balance sheet
- Identifying a path to profitability.
- Communicating about money including
- Employees, vendors, and investors or other stakeholders.
- Terms of payment and descriptions of scope of work.
- Protocols for everything related to payments, especially for working with multiple invoices, purchase orders, vendors, and tax accounts.
- Forecasting the future of your business.
Other financial skills needed for financial literacy by entrepreneurs:
- Know how to find investors.
- Know key accounting concepts well enough to make decisions: balance sheet, budgeting, profit and loss, cash flow, spending.
- Keep current and accurate books.
- Monitor income, expenses, cashflow.
- Know how your business is doing financially at all times, even if you outsource accounting.
- Work with a tax professional to save money.
Sales skills, or prospecting, which involves creating a database of potential customers and converting them to actual customers, is another important, related set of skills to have or recruit someone to fullfill.
Sources: Financial Skills Every Entrepreneur Needs to Succeed (Maker’s Row), How Entrepreneurs Can Manage Their Business Finances With Success (Entrepreneur), How Important Are Financial Skills For Entrepreneurs? (Techie State)
Tip about Credit Scores: Some investors may look at your credit score as a measure of your financial skills and responsibility. It may be worth the effort to try to improve a low score.
