SMME EP429 Using Your Numbers to Make Better Business Decisions with Danielle Hayden

11:26AM Apr 10, 2025

Speakers:

Daniela Woerner

Keywords:

Spa marketing

leadership skills

business growth

financial planning

tax preparation

money team

bookkeeping

CPA

financial advisor

CFO

S corp

business goals

profit margin

business decisions

entrepreneurship.

Welcome to Spa Marketing Made Easy, a podcast for spa owners who want to step up their leadership and business skills and step into the role as spa CEO. I'm your host. Daniela Woerner, CEO of Addo Aesthetics and Founder of the Growth Factor Framework Program, where we teach, coach and guide spa owners in scaling their spas to the next level of growth and unlocking freedom in their life and their business. I'm so glad you're here now. Let's dive into the show. Important question for you friends, how are you feeling about your money and your taxes today, if you're listening to this on the day that it's released, April 14, the day before tax day, my wish is that you feel calm and prepared and like it doesn't even matter that your taxes and quarterlies are due tomorrow, hopefully you already have them paid. But that feeling of calm is not something that I have always had. I had years that just felt like complete chaos, and I decided, You know what, I do not want this energy in my life. But how do we get rid of it? Because we all pay taxes, right? That's not going away, but you can get rid of the stress when you're surrounded by the right money team, and that is why I am so excited to introduce Danielle Hayden, our guest on today's show. She has the most incredible background. Get this. She is a hair stylist turned CPA, and she's the CEO of Kickstart Accounting. Her accounting firm has been around for the past 10 years. We had so many synergies over the the times that we were talking over zoom and kick start, accounting is the newest partner in APA. Now, if you're not familiar with APA, it's a place for esthetic professionals to build a thriving business and community, and one of the perks in there is that we have a big black book of recommended vendors, many of whom offer sizable discounts to APA members, including kickstart accounting. Anyway, Danielle gives tons of information, tons of value in this episode. I hope that you enjoy. It definitely worth a listen. So let's go ahead and play that interview. All right, Danielle, welcome to the spa marketing Made Easy podcast. I I love talking about money. I love talking about numbers. I love normalizing these conversations with women. So I'm so excited. You're such an open book. I think there's some really important things that we can get out there today around money and finance and accounting. So thank you so much for being here. I'm

really looking forward to it. I promise we're gonna make this topic really exciting. I know most people shy away from this conversation, but my mission is really to make money and numbers approachable and fun to talk about.

Well, I love that because it is like it's kind of this weird thing that when we start a business, or even if we're on, like, a specific career path, if we're an employee and trying to move up, we're uncomfortable asking for raises. We're uncomfortable saying how much money we want to make. It's one of those. It's like, what is it death, taxes and politics,

or what, like my mom used to say before any any dinner that I went to, remember Danielle, don't talk about religion, politics or money. And now I'm like, Ma, I go on on live screen to talk about money on a regular basis.

I was so last night I was at karate. My kids do karate twice a week, or actually, taekwondo. But I don't know why, in my mind, it is, like, infused, that is karate, but it's actually taekwondo. And I was talking to this other mom. She was so like, I just clicked with her right away. And she was, she's a preschool teacher, and I was like, you know, there's people that put their lesson plans online and then you sell them and you can do and I'm like, telling her this whole thing, and I'm in like, Daniela coach mode, you know, even though I'm at a mom event, I had like, a different hat on. I was like, so how much money do you want to make every month? And I was like, didn't realize that in the coaching space, like, when I'm talking to somebody, I can so easily just be like, tell me how much money you want to make, you know, and talk about it and talk about it. And at karate, it was, like, the most inappropriate thing. And I was like, Okay, let me put my phone away. Like, because I have my calculator out, I was like, I can calculate your profit margin and what you would need to do. So I was like, Okay, stop. Like, get back in mom mode. Like, let's be focused on the roundhouse kicks and go from that

great, great self awareness to bring it back in check.

Sometimes you need that, like transition moment, you know, but it is something that I do think should be so normalized, and I think there's so many because we're we grow up with those beliefs. Of don't talk about this, or it's not appropriate, or people are clearly uncomfortable to talk about it. We need to do it even more as business owners, to make sure that we're comfortable looking at the numbers and understanding understanding the overall health of our business and understanding what we need to be able to live the life that we want to live. So before we really like start going down the rabbit hole here, why don't you tell us a little bit just the summary version, the nutshell version of like you, how you went down this path, how you started your company, all of those types of things.

Yeah. So I actually started my career as a hairdresser, I was working behind the chair as a creative and while I was working, I got really good at understanding the numbers of what I needed to bring in to hit these different goals, and I started to teach the girls who I worked with How to read their paycheck, how to reach their goals, how we as a salon could hit our like, our retail metrics. We became Salon of the year and really helped them.

Basically, I always say, like, spa and salon are like peasants. So yes,

yeah, they really are. So I realized I had this knack for helping people understand the numbers and to use it as a game, right? Like I mean in that context, yes, it's our paycheck, but to use the numbers as a game of, how do we hit our personal and our business goals? Then took a hard right into corporate accounting, and my job there was to help the CEO, the investors, the management team, understand our numbers so that we can make better business decisions. So did you

just go from hairstylist to corporate, or was there, like, any schooling or training, like how

I was going to school, I had my master's degree, my CPA. So while I was working in the salon, I was going to school, working

that is a hard right? Yeah,

yeah. I was doing both at the same time. So while I was doing hair, I was always in school, worked at Ernst and Young while I was still behind the chair, finally left the salon to go into into working in the accounting field full time, and at that same time I was I realized I was doing a lot of the same thing, helping people understand their numbers so that we can hit our goals. So the board, the investors, the management team, the CEO, we had to look at that information and decide what's working, what's not working, what are we going to stop doing? Where are we going to go the next quarter? How are we going to do better so that we hit our goals? I remember this moment in the boardroom where I was sitting there watching this conversation unfold, and I said, I am doing this to help the rich get richer, right? Like I'm helping these people, these investors in this room, and I truly believe that every business owner, right, small business owners deserve access to that same information so every single person can make that same decision. I was doing some volunteer work at a a local entrepreneurship hub here, and I realized that small business owners didn't even have bookkeeping in place. Oh,

no. I mean, it's amazing. I was working with a spa that was doing well, 800,000 a year, 800,000 and she literally had no idea where her net I was like, well, doesn't your CPA or does? Don't they send you your report? She's like, No, I just look at it when I do my taxes at the end of the year. Oh,

yeah. We can talk more about that. We can talk more about that. But so I realized that ever you know, we can't set a budget or a business plan or or raise money like we can't do any of that unless we have bookkeeping in place. And so I went on a mission 10 years ago. Kickstart just celebrated 10 years this year. Thank you. We went on a mission 10 years ago to help every single business owner with bookkeeping, which then helps them understand their numbers make better business decisions. We do taxes as well, but taxes are like a bonus, like we can just show up to tax season super prepared, because we're business owners who use our numbers to make business decisions every single month.

And that's such a for me, we have this kind of process that we've been doing for the past, I would say probably six years. We're also 10. We're in our 11th year now. So we were on a very similar path. And probably around six years ago, I started meeting with my financial advisor, my CPA and my husband. Yeah, and at the end of the year, and really saying, what are my what are our goals as a family? And so how much money do I want to pay myself? And so how do I take that number with my CPA and my financial advisor to understand what the goals of the business are? Because it's, it seems kind of backwards. Most people are like looking at their business and setting the goals, but for me, you you should be building a business around the life that you want to live and using that as the Well, here's how much money I want to be able to hit my goals, and here's the profit margin that we're hitting, and so here's the goals that we need to set. And that has worked tremendously in helping me live the life that I want. That changes season by season too. It does no idea, right? I mean, I have, I have two small kids. You know, I started this business before kids, I birthed two kids. My husband was active duty for 21 years, so we were moving all the time. So there's different seasons where you need different things, and without the relationship that I had with our CPA and like, like, understanding those important pieces, I have no idea how I would have been able to make some of those business decisions. You know? I mean, it's vital.

You feel like it's never enough. So if you're not meeting with your money team, so I call that your money team. If you're not meeting with your money team, and you're not having that strategic level conversation with them, you end up in this cycle where nothing ever feels like enough, no matter how much money you bring in, no matter how much revenue you have, no matter how much you pay yourself, no matter how much draws you take never feels like enough because you never took the moment to set the budget, to set the goal and to coordinate that conversation with your money team.

But that's the hardest thing to answer, right? Is when is enough enough? I mean, that's the I can have someone come in and tell me everything that they don't want, and then you ask them what they want, and it's like, I don't know. I want a million dollar spa. Well, why do you want a million dollar spa? You know, like, Do you want a million dollar spa? Do you want a ten million spa, or do you want a half million dollar spa? Like, what is, what are the things that you want? And I think that even just by getting to a place where you're setting goals, you have to answer those questions for yourself. It forces you to think about the life that you want to live, and what you desire, and all of those pieces, yeah. So tell me more about you had mentioned there's like four money people. Who are these people? Tell me about your money team,

yeah. So we want four, four people on the on the Money Team. And I know four sounds like a lot, so, but I don't really, don't care how big or small you are, so you might just be starting out. You might be celebrating 10 years like we are. I always want you to have four, four people. The primary person is your bookkeeper. Now most people go into business and they hear you need to get a CPA, right? You need to somebody to file your taxes, but your CPA can't file an accurate tax return, and they can't give you the information and the support you need without bookkeeping. So really, our most important person that's going to organize and coordinate everything for you is a bookkeeper, and that's why at Kickstarter accounting, we start with bookkeeping, because it is really difficult as a business owner to do all the things. And I know that as a business owner, you want to stay in your zone of genius, to do only the things that you can do. And I want you to stay there. You don't need to know how to do bookkeeping. I went to school for a really long time to do bookkeeping. Our job is to help you while you're out, making money, spending money, to organize the income and the expenses. And we do that every single week at kickstart, and then your bookkeeper should be sending you the financial statements every single month. Now, our clients receive what we call snapshots, where we walk you through a high level overview of of your numbers, no matter who you are working with, you should be looking at your financial statements every single month. Bookkeeping is show you, showing you where you just went, right, like, what just happened. And we need to be looking at that monthly so that we're doing that in real time. Does that make sense? Yeah, all right. The second person is our tax account. So they are our tax account, CPA, their only job is to file the tax return and to help you with tax planning. So a lot of times, what happens is that we because our tax accounts, the first person we hire, we're calling our tax accountant for business advice. We're saying, Well, you didn't send me the financial statements. I don't care about the bookkeeping. I multi bookkeeping so I can file your tax return right like they're not thinking about it in that way your bookkeeper is thinking about I need to organize the financials so that you understand your numbers, so that you can make better business decisions your tax accounts. Job is to make sure that you can file the tax return again, the bookkeeper is. Giving the tax account accurate financials. They need to know what they're looking at. They need to have that information so that the tax accountant can then file the return and help you with tax planning. Those two people should be able to talk together. So here at kickstart when, when somebody gets on the phone with our team of CPAs, we've already coordinated hours behind the scenes with our bookkeepers. So the bookkeepers and the tax accountants, they've already coordinated behind the scenes. So by the time our client gets on the call, things are done. And so you want a team who can talk to each other, so that you're not having to play that middleman. So the second person is the tax account, the third person is your financial advisor. So you had mentioned, you know, your husband's a financial advisor, helping you look at, what do I need personally, our business can't be our retirement fund. We need to have outside investments like it creates a whole person, a whole unit, and so we need to have retirement options, investment options, savings that sit outside of our business, and our financial advisor helps us navigate that. And then we have our CFO. Our CFO is the fourth person on the Money Team. Now I said bookkeeping helps us look backwards, so what just happened, and our CFO helps us to start navigate the future. So our CFO is going to help us look at what are our goals in the future. And let's set a strategic budget. Let's pay down debt, let's look at cash planning. Let's start to plan for the for the future. But we can't do that until we have a really clear vision of what just happened in the past.

And so you said you want all four people, no matter what size you were, how the CFO is the one that I'm questioning. So at what point I know a lot of businesses will say, hire a fractional CFO, or have just like a once a year sit down with a CFO. Are you even doing that. Say I'm a nurse, and I just left anesthesia. I'm starting my med spa, and it's just me right now, like I am a solo nurse injector, and that's what I'm doing. Would you still have a CFO?

So just like you said, we we offer like fractional CFO services for our clients and one off budgets. So for somebody in that situation, I would say, get your bookkeeping done first, right? We need to know bookkeeping is organized. You'll have your CPA team, and then you can do a once a year budget with a CFO team. So our CFO team comes in for our bookkeeping clients. Does that once a year, your your budget, talks about the goals where the business is is going, and then they're there when they're ready to initiate that on ongoing process. But I do believe that every business should be setting a budget, but when you're ready, the bookkeeper and the tax account are the my non negotiables. The financial advisor I actually want you to have pretty early on in in business. Yeah. And then I agree with you, the CFO, something you can add on as a one time budget, or as you are ready to start looking at the future. Not every business owner is ready to look at the future. So

we were talking a bit before we hit record here about S corps versus single member LLCs, and when is the right time to do that is, who is that person that's giving you that advice is that the CFO is that the CPA is that your bookkeeper, like, where are you? That's been one of my biggest complaints that I've heard from our account, from our students that are saying my my CPA doesn't tell me anything. They don't tell me that I should be doing a backdoor Roth, or they don't tell me that I should be bringing on a 401, K account for my staff, or that I should be switching over to an S corp. These things that can save you 10s of 1000s of dollars in taxes. So who's whose role is that?

So I disagree with my industry, so I'm going to say, start there, that what I'm going to say is not standard across the board, not all CPAs do this. The CPA Tax world has become very transactional and and in part, I blame our government for this, because you have to get in a lot of tax returns in this small window of time. We're working under a very tight deadline. And CPAs were taught how to file a tax return not run a business. They're no more of an entrepreneur. You know, they went to school to file that tax return. So they're not entrepreneurs. So we have turned this, this thing, into a very transactional experience for entrepreneurs. So. Yeah, and it leaves people very frustrated. And so what we've created at Kickstart accounting, through we have, we call it our sister company case, a tax partners, we've created this experience where we can work together both the bookkeeping and the tax team to be able to answer questions like this. We go out of our way to make sure that our clients have this answer. Every single year, your CPA should, at least annually, be looking at your entity structure to let you know if you are working within the right entity structure. So during our mid year tax check ins, every single one of our clients receives a mid year tax check in and like, August, September, October, time frame. And during their tax snapshot, we're walking them through, are you in the right entity structure? And that's where we're looking at, you know, should you become an S corp or or should you stay where you're at? Is an LLC the right? Right for You? However, at any time, if you start to think, like, if you listen to the show and you're like, Oh, I actually do hit those milestones, you should be able to go and ask your CPA and your bookkeeper at any time if you should become a S Corp. Unfortunately, the answer in the tax world is gray, because not everybody agrees on when is the right time to become an S corp. Your CPA should be able to run some forecasts for you, to show you what how much you would save. But if it's okay with you, I'd love to give you kind of like my three things that I want to see before somebody becomes an S corp. Yeah, absolutely okay. So if you are hitting these three milestones, go have the conversation with your your CPA. If they don't want to have a conversation with you, we will have that conversation with you. So if you are making net income of $100,000 a year or more for more than two years, so not your gross revenue, I want you to look at your net income, because after all of your expenses, you need to have enough money to pay yourself. The IRS says this is not Danielle's role. It's not kickstarter's role. The IRS says that once you become an S corp, you have to be on payroll. You have to pay yourself through payroll, and you have to pay yourself what's called a reasonable compensation. And reasonable compensation is how much would you have to pay somebody else to do your job in your area? So this is location based, and we find that around $100,000 of profit is enough to pay you, plus the payroll taxes and possibly take out any owner straws as well.

Okay, so that's rule number one. That's

rule number one. Rule number two is that you are consistently taking out owners draws today. So just like we're not going to go on a diet on Monday, we're not gonna start routine on Monday, you are not suddenly gonna become an S corp and have enough cash to pay yourself. So as an LLC, if you are not consistently taking owner's draws, then we need to get you taking owners draws first, so that we know that your business has enough cash to pay yourself once you become an S corp. If you can't pay yourself and you need to dissolve your S corp status, you can't become an S corp again for five years. So it is a it is a decision that we need to take take seriously. Number three is that you are not comingling business and personal expenses. So if you are currently, you know, paying for your mortgage through your business or your kids, daycare,

housers, that happens.

It happens more than I wanted, but so if you're doing that type of commingling, you need to stop the commingling first, just like the day on a Monday. You know, I like to use that as a as an example, because just because you become an S corp, and you think that, Oh, now it'll be really serious, I'm going to really stick to it, you're not separate your business and personal expenses. Start paying yourself on a regular basis, moving money from your business account to your personal account, taking those draws. Once we have that established and we're bringing home an income of over 100,000 it's a no brainer to become an S corp. It is a great tax savings. You can pay yourself through payroll. You can enjoy the reimbursements through an accountable plan, you now have a paycheck stub to go buy a car or apply for a mortgage, like there's some serious benefits of becoming an S corp and having those three things in place. Make that decision really easy. What about

your if, if you're in partnership, if you're your household income, obviously is going to have an impact on that too. So would you be like say that you have a spouse that earns a high income, or if you have a spouse that does not earn a high income, you know if whatever the role is, would your advice? On switching over to an S corp change in any way.

You know, for our family situation, my my opinion, actually doesn't change. So when we work with our clients, we do work independently between the business and then the family. So when we look at the bookkeeping and our stance on S corp status, tax reserves, saving for taxes, we really want to look at the business as an entity by itself. Here's why. Today you might not be thinking about selling your business, but maybe in three years, somebody comes along with a really attractive offer, or your health changes. Your family's health changes. Something changes, and you decide that you want to sell your business or you need to take on investment dollars are alone. By having your business completely separate from your from your personal we're able to look at the business as its own entity, as its own individual, almost. And I want you to make that decision to become an S corp, because your business can afford to pay you that there's going to be tax savings for for the the business. Your tax accountant can then look at the whole picture as a personal situation. I don't believe I've ever seen where becoming an S corp actually affected, negatively impacted, that your personal tax return

Good to know. Well I know, like I kind of teased in our in our APA group, that we have finally found an accounting firm, a bookkeeping firm that we are excited to partner with. This has been a long time coming, and we when I and I didn't even know that you used to be a hair stylist, which, like is the cherry on the cake, it makes it even better. But I think that, you know, there's a lot of things about the way that you operate your company, about the relationship piece. I also, you know, I love men. I think men are great and very intelligent. But I think in a business, in an industry where we're over 90% women, and it's such a taboo subject. Sometimes it's really nice to be able to talk to another woman about these types of things. You know, it's your guard is let down a little bit. And so I'm really, really excited to officially bring you guys on as a partner of Addo Aesthetics, and we've got some really awesome partner discounts available inside of APA. So Danielle, do you want to share just a little bit more about where our listeners can find you and follow you if they want to get more information from you?

Yeah. kickstartaccountinginc.com/gift, there is some beautiful downloads in that that link, kickstartaccountinginc.com is our website. You can come book a discovery call. We love relationships. We have long term relationships with our clients, and we can have an open conversation. So wherever you're at in in your business, come both the discovery call. My team is even nicer than than I am. They are this amazing welcoming team. We have a team chat, and as we were recording, I'm watching them celebrate clients wins. Every Friday that that chat gets really active just celebrating our clients, because oftentimes we don't have anybody else to celebrate with. So our team likes to celebrate with our clients and loves to be there for them when things aren't going well. So come book The discovery. Call the amazing team that's excited to be of service to you. Kickstart accounting on on Instagram is where we hang out, and then business by the books is our podcast where we talk about how to use your numbers to make business to make better business decisions every single

week. Love it. Thank you so so much. Be sure to follow Danielle and kickstart accounting, and you're welcome. This was a lot of work to find. It's a lot of work, but we're really excited. So thank you guys for listening, and we'll catch you on the next episode.