Zero To A Hundred – Episode 45: The Fractional CFO Advantage: Strategic Financial Growth With Gershon Morgulis

Accelerators! 🚀

Scaling from $10M to $20M sounds simple—until it’s not. This week, we sit down with Gershon Morgulis, Portfolio CFO at Imperial Advisory and Finance Professor at Touro College, to uncover the financial roadblocks that keep growing businesses stuck. From repricing strategy and smart investing to maximizing ROI and building redundancies, Gershon breaks down the CFO mindset every founder needs to make decisions with clarity and confidence.

What’s on the Menu:
 📈 Why your biggest bottleneck may be hiding in your P&L.
💸 How to invest for scale without blowing your margins.
🧠 The power of financial hygiene and how it can protect your future.

Why Tune In?
With decades of experience helping business owners double revenue without doubling risk, Gershon shares hard-earned insights on what really moves the needle when you’re chasing growth—and what financial mistakes will cost you more than you think.

💬 Gem from Gershon:
 “If you made it to $10 million, you could probably sell your way to $20 million—but there are a whole bunch of things that could go wrong.”

Get in Touch with Gershon:
 📧 Email: Gershon@ImperialGRP.com
🔗 LinkedIn: linkedin.com/in/gershonmorgulis

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The Fractional CFO Advantage: Strategic Financial Growth With Gershon Morgulis

I’m excited to introduce our guest, Gershon Morgulis. He is the Portfolio CFO at Imperial Advisors. He’s a Professor of Finance at Touro College. He has his MBA, and he’s a former investment banker. We’re going to talk about all things fractional CFO services, which I want you to tune into. We’re going to cover topics like how to strategically grow your revenue, repricing strategy, the importance of redundancies, and how to maximize ROI with the investments you make in your business.

For those of you who don’t know me, my name is Jarrod Guy Randolph, I’m the founder of BoxFi. We are the nation’s leading payment processing consultant, providing business growth solutions through payment processing. I’m excited to share the network that I’ve built over my 25-year entrepreneurial journey to help you grow your business and become more profitable. Ladies and gentlemen, let’s accelerate together.

Gershon, welcome to the show. How are you doing?

I’m doing well. I’m happy to be here. Thanks for having me.

We want to learn the goods, all the amazing deets about why you created Imperial Advisory and the types of clients that you work with. Give it a go. Let’s know a little bit about your background.

The Genesis Of Imperial Advisory, Identifying Key Clients & Critical Turning Points

I have always wanted to be in finance since I was a little kid. Once upon a time, I was in between jobs, and I had a friend who said, “We’ve got this business. We need some help.” That’s where it started. It reached the point where I was working for one particular business. They were a family business, supporting multiple generations of two families. They were paying me out of their next vacation. At least that’s how I saw it. I’m like, “They’re paying me. That’s how valuable it is to them.” I fell in love and decided I wanted to do this forever.

Tell us a little bit more about the types of businesses that you work with in your fractional CFO side of the business.

We’re a fractional CFO firm. We’ve got a team of experienced CFOs. We work in many industries, but there’s still an underlying theme in the businesses that we work with.

What are those underlying themes?

Underlying themes are owner and privately held business. We typically work for the owner. They typically have accounting in place. They’ve reached a point where there is a real, solid business. It’s running. People are getting paid. Vendors are getting paid. They’re billing. Stuff is happening. The business is running, but something’s not right. You have the CEO, who’s usually the owner, who’s spending their time trying to be their own CFO. That’s usually when we get called in.

That’s the moment that becomes the turning point. Is there a specific pain point or something that happens for that CEO who’s trying to take on the role of CFO as well that you generally see where they go, “It’s time for me to bring the right person in.”

Often, it’s around growth. Sometimes, if they’re in trouble, it’s around cashflow. They’re like, “Something’s not right. We have no money. Why do we have no money? We need to figure this out yesterday. We’ve been bleeding cash. We’ve been living off of deposits, like client deposits and pre-payments.” That’s not very healthy.

On the flip side, they’re looking to grow. They realize that there’s this fuzziness in their understanding of their own business. They might be making $1 million or $2 million a year. A business might be doing $10 million in revenue. They’re making a couple of million a year, but they’re not sure what to do next. They know that whoever got them here isn’t going to get them there. They have to make major investments.

I’m thinking of a client. They’re in some type of service. They told me, “We’re stuck at $10 million. We’re not going to get to $20 million. We want to get to $20 million, and we want to do that profitably, but we’re not sure how. Should we hire a business development person who’s going to cost us $500,000 to $1 million a year after we take salary and everything else into account? Should we invest in Google Ads? Should we host a show to highlight what we do?” These are major investments for a company that’s making $2 million or $3 million a year. It’s half their profit, so you want to get it right. That’s when they call us.

Strategic Growth Vs. Costly Investments & Revenue Doubling Strategies

This is interesting. I don’t think we’ve discussed this on the show before. You’ve got a business where they’re not trying to make a quantum leap going from $10 million to $20 million. It’s only doubling what your revenue is. What are some of the things from a financial standpoint that a business owner could do, like this example that you gave, to increase that revenue versus going and spending all the money on the business development person and marketing, or starting a show, for instance?

For alternatives, there often are things that are low-hanging fruit, which is not necessarily our specialty directly. If you made it to $10 million, you probably have a CRM full of leads. I was on a call with someone else discussing this. Not everyone hires you the first time around, but you could be following up with those people.

If you’re in professional services, you probably have lots of clients. How about calling your clients and building a process internally for asking your clients for referrals? You might have a collections problem. It will grow your top line if you solve your collections problem. Either way, that’s a way to unlock cash, which means you have more cash to invest. For other things, you can cross-sell. You can make an acquisition that grows top line. I’m not sure if these are the answers you’re looking for.

One company in particular comes to mind. They were making a few million a year. There were all sorts of metrics. I was talking to the CEO. He was a hired CEO. I said, “You’re being measured based on profitability. If you take $1 million and you buy another business that generates profitability, do they recognize the fact that that’s growing profitability? That option should be competing for marketing dollars. That’s growth investment. Marketing is one way to grow, and this is another way to grow.”

I love that idea of being a business where maybe you buy an auxiliary or a complimentary service, which you can tack onto your service offering to go out to your clients, especially if it’s an existing business that is cashflowing. If it’s complimentary to your business, there might be creative financing ways that you could do that with little cash out of the pocket. Are there specific things that you do from a financial standpoint for this client who says, “I want to go to $10 million to $20 million,” that can help them get there more quickly?

There are. Things that you can do to help them get there quickly are going to be around making sure that they don’t have certain hiccups. As you grow, your accounts receivable grow. Lining up accounts receivable financing, lining up a line of credit, or knowing that you’re going to experience a situation where you might be short on cash is going to help. Having the right people is going to help.

You say, “That’s not finance,” but having the right people is relevant to finance because having the right people might cost money. There’s a hiring strategy that has to do with HR, but it also has to do with finance. Are we going to overpay so that we can get people quickly, or are we going to have a bench of people that we have to carry while we’re waiting to find those next few big clients?

There is a financial impact to all of this. By structuring it right, maybe you’ll have a lower margin, but you’ll be able to grow faster. What’s the goal? Is the goal to hit that $20 million revenue number? Is the goal to maintain your 30% or 40% margin? These are all non-traditional things that finance is going to get involved in. In a certain way, the CFO is a business partner with a financial focus.

The CFO As A Strategic Partner: Experience, Perspective, And Value

That’s interesting. I don’t think we have dove deep into this. I’d like to stay on this because this is important, what you’re talking about. Let’s say you are an operator who has a business. You are looking to double your revenue or scale your business, and that key component of a CFO is missing, or somebody who’s a finance director. What should the expectation be? What should they look for someone like you to bring to the table to help them organize the business so they can start to get to that level of growth?

Different firms are different, so I’ll focus on us. What we offer is experience. Our team has been there before. Most of our guys have 30 to 40 years of experience, much of that as a CFO and some of that building up to that level. My brother is in marketing-related things. He’s in PR. He told me, “If you have a broad enough view of the world, fewer things are out of the box. You don’t need out-of-the-box thinking. You need someone who has a bigger box.” It’s true. When you have the CFO that comes in and says, “You have a beautiful P&L, and you got all this stuff sitting in AR and it’s growing. Why isn’t someone dealing with that? How are we going to deal with that? Here, I’ll introduce you to someone who can help with that,” that’s very important. That’s valuable.

There’s something to be said about having the experience. The old adage, which 99% of people I’ve ever met get wrong, is that a Jack of all trades is a master of none. The full quote is, “A Jack of all trades is a master of none. Yet, oftentimes, better than a master of one.” When you had that 30 years experience and have worked with multiple businesses, being able to bring those experiences into what you do when advising other clients, does give you, to your point and what your brother said, a far more broad perspective to help you solve the problems that you think are unique to you, and they’re not. Many people have suffered through them, and there are ways to get to the other side.

I’ll mention 1 or 2 other things quickly. There are commissions. Are commissions a salary thing, or are commissions a financial component? Understand and build the right compensation program to incentivize people in the right way, and also keep an eye on how that impacts profitability on the next incremental item, on the growth, and the business that you’re looking to have. Get that stuff right.

My premise is that if you made it to $10 million, you could probably sell your way to $20 million, but there are a whole bunch of things that could go wrong. You’re going to have people problems. You’re going to have not enough people. You’re going to have management problems. You could run out of cash. There are lots of different things that can go wrong, too.

The owner stops being the person who can be the center of everything. You’ve got a higher management layer to replace that person. You may have to hire three people. That could be a profitability and a human resource nightmare. There are all these different things that you have to get right. A budget could be a non-traditional thing that can help you get there, not just for the sake of budgeting, but understanding the intricacies and saying, “If we invest this money now, how long is it going to take to have ROI?”

We had a client. They were in SaaS. They had to meet someone 6 or 8 times before that client became something, or before that client would ever sign up. Our client was a software company. The client of the software company had to hear about the software company eight times before they would buy in or before they would use the software.

For them, marketing was about making sure that people knew their name, so that when those people showed up, they got referred, they met them at a show, and they would sign up. You’re investing, but it takes time. You can’t hear the name 6 times in 1 day. It’s understanding that there is a timeline. We have to invest the money today, so that something happens tomorrow.

It’s understanding the interaction of how all these things work together. Today, we need to invest in marketing people, and if we’re successful at this, then in six months, we’re going to need more onboarding people. Onboarding people are not going to scale in the same way as operational maintenance people. For complex software, you need to have customer service people.

It is putting all that stuff together so you don’t have hiccups, and then lining up money. You might need to hire more onboarding people for any kind of business onboarding. We’ve seen in some businesses that onboarding is the biggest bottleneck. You’re a profitable business, or you’re almost a profitable business, and you’re throwing away business because you can’t onboard your clients. That’s the bottleneck, not the work. It’s about anticipating these things and understanding what the impediment is. Maybe the impediment is that you don’t have an internal HR team. Maybe the impediment is not the proper benefits.

In essence, it’s looking at the financials of the business and figuring out what your cash flow is and then what you allocate that cash flow towards to solve those problems. When you have that bottleneck of onboarding because you have a certain volume of business or it’s grown beyond your capacity, having the financial wherewithal to go out and hire that right person and make sure that you bring in team members to solve that issue does get down the finance at the end of the day. That’s super insightful.

It could also be repricing. We had someone on our team once who pointed it out to me. I’ll give him a shout-out. His name is Buddy Blattner, one of our CFOs. I was talking to him about a situation. He was like, “If you have this much demand, raise your prices.” There are multiple ways to solve an onboarding bottleneck, but saying, “We’ve got a four-month wait,” is probably not the right solution if you’re looking to grow.

ROI Metrics: Revenue Per Square Foot, Profitability, & Repricing Strategies

Is there a metric to follow to decide, based on demand, if you should raise your prices?

I don’t have a metric for that. It depends on the long-term goal of where you want to be and what you want your business to be. If you want to be the premium provider, too much demand is a sign that you may not be charging enough. If, on the other hand, you’re a first comer in the market and you have to have serious market penetration, and you have to be everywhere to everyone, that’s the kind of place where you might want to expand your capacity.

Are there other things that business owners should be looking at in terms of repricing strategy?

We have inflation, maybe less than we did, but there’s inflation. Your profits are going up. The way I like to look at it is, what is the fact that your cost can do to you? It’s going to make some things less profitable, and then you have to make those tough decisions. “Do we want to raise prices? Maybe we want to cut out some of these less profitable things. Maybe we want to cut out less profitable things or things that are no longer profitable or don’t hit our margin targets, and then invest in marketing to build up some of the other divisions.” It’s not always about raising prices.

That’s an interesting concept. Let’s talk about this. Our audience could appreciate this. I  experienced this with one of the clients that we work with, who has a coffee shop. They had products that weren’t performing, or the margins had shrunk so much because the type of coffee that they were distributing was too expensive. What they did was they started to take things off the menu that weren’t producing. From the standpoint of a revenue increase and cost savings, cutting items or figuring out how to remove specific products is a very interesting strategy around repricing. That’s a unique strategy.

It’s a common thing. Think of it like this. In every business, your business, my business, and every one of our clients’, and some of them can call me up if I’m wrong, and I look forward to learning the 1 or 2 cases, there was always a bottleneck. You have to understand and identify what that bottleneck is. The bottleneck might be capital. It might be people. It might be the owner’s brain space, which is a very common one. You cannot do all the things at once.

In retail, the bottleneck is often shelf space. If they have a healthy demand, it’s shelf space. This thought process leads to what your KPI or Key Performance Indicators are. What are the things that you want to be measuring? We had a client who had retail. They looked at revenue per square foot. They looked at the overhead per square foot.

It’s about understanding what those things are, and then you say, “Our bottleneck is shelf space. We want to maximize value there. We want to maximize profit.” You might have loss leaders, but if you have something that’s a loser that’s not a loss leader, then you say, “What do we need there?” Maybe you raise prices a little bit on everything, or swap that out for something else.

You shed some light on something for me. I never understood from a retail perspective, because I’m not in the retail business, why people talked about per-square-foot revenue. I understand the comment that you made about shelf space being a bottleneck in terms of maybe there are things that you should not carry on your shelf because they’re not moving. You replace it with product that is moving, so you’re increasing your revenue per square foot.

That’s exactly right, but it’s not just that. It’s even beyond that. Think of a doctor’s office. I would look at revenue as one of many things. I’d be looking at revenue per square foot, and not really revenue, but more profit. Revenue, in this case, is an indicator. It’s measuring, whatever you’re measuring, per square foot of a doctor’s office, because you’re paying rent.

Maybe somewhere else, you’re going to have fewer patients, but it’s going to be so much cheaper that you’re going to end up making more money. Meaning, your rent will be cheaper, your maintenance will be cheaper, and whatever else it is. In this analysis, either it’s not just about things on the shelf or doctors, nurses, and people are the things on the shelf at a doctor’s office. There are different ways to frame it.

Every business is a little different, but every business might not be square foot of rent, but then it’s the room you have in your office. You’re a marketing agency or an accounting firm. You only have so many seats. What are we doing to maximize our ROI on that rent? What are you doing to maximize your ROI on the salary you’re paying to the partner?

I will talk to accounting firms in case they’re reading. I have spoken to an accounting firm once with a guy. He was a partner in charge of a major office of a major accounting firm. It was a big market. He was like, “I got 50 clients. Every single one of them wants me to be their fractional CFO, and I have a whole accounting business to run.” For him, he decided that being every client’s fractional CFO was impossible, and going into the five who paid the most was going to tank the rest of his business. He was like, “That’s not a business I can be in.” For him, the bottleneck was his time.

Talking To Your CFOs About Financial Strategy

Are there certain things that you should be looking at when you’re creating your metrics for ROI? The revenue versus OpEx per square foot is interesting. To your point, you have this expensive doctor’s office, and you have a ton of patients, but you’re paying so much that you could go to another location where you could have 10% less patients, but it’s 50% of the cost to operate the office and you’re making more money. Those are unique things that I feel a lot of people aren’t having those conversations with their CFOs, whether it’s full-time or fractional CFOs. Are there other ROI benchmarks that you should be looking at in your business that could help create more profitability?

The first thing is you should be talking to your CFOs about that, or they should be talking to you about it. If they’re not talking to you, you should be talking to them. I teach. My students know that my favorite answer is it depends. Every business has different things that are unique places where profits can slip out. In professional services, for example, figure a marketing agency, an accounting firm, or a law firm, if you’re paying people high salaries, you’re going to have certain things that create value, which those people are doing. You’re going to have other things that create less value or no value. You’re going to have things where they’re not even busy. In accounting firms, they call it not utilized or underutilization.

In a professional services firm, you can have all these beautiful ROI metrics, but benchmark yourself against yourself. If your people are not busy 1/3 of the time, is that an efficient structure? That could be profit floating away. As I said, it depends because maybe you pay your people a little less. I know a fellow who is a partner in an accounting firm. He told me, “Our motto is,” or the motto that he’s trying to get to, I’m not sure, “We want our people to have a life.” That’s a value there.

I spoke with someone. He works at a top ten or so accounting firm. He said, “We don’t do busy season. It’s not something we do.” I’m sure that they’re getting paid less for not doing busy season, but having a culture where you’re only utilized 70% of the time may be exactly why people are taking salaries there 20% or 30% less and are happier, rested, and smile when the clients call instead of grumble.

Every business has to understand what drives its business. They have to understand what drives their people and how to take care of their people. Especially professional services people are where it’s at. That’s a little bit about professional services, but then you’ve got other businesses. Inventory is probably the easiest thing to pick on, although debt is a fun one, too. In inventory, you have As, Bs, and Cs. Which ones are you running out of? Which are the ones with the stockouts?

The stockouts are the fast movers. That’s where you make your money. Imagine you reallocate your investment and inventory. You spend that money being overstocked on the stuff that people want, rather than the random stuff that sits on your shelf for a long time. If you don’t, those stockouts are lost revenue, and by lost revenue, it’s lost profit and lost everything.

When people walk into your store online, the website trackers call it a U-turn. They come, look around, turn around, and leave because you didn’t have the thing they wanted, but you had a lot of stuff that nobody wanted. That’s money walking out the door, revenue or profit, or both.

There’s debt. You have people who don’t understand how to use debt, and they can get themselves in lots of trouble. I was in a retail store, and they had a broken fridge. Due to their broken fridge, besides of whatever it does or doesn’t do in the credibility as an establishment, I didn’t buy a cold drink because there was no cold drink. I was like, “For a hot drink, I could have that at home. I don’t need that here.” You end up with sales walking out the door like that, and because they perhaps didn’t have proper planning, they didn’t have reserves.

It could be that they’ll get the thing fixed in a day, but maybe that takes them a few weeks to go get a loan or a line of credit to fix the machine. They have to fix the machine, but because of a lack of planning, they potentially either take on a higher interest loan than they would otherwise want to if they weren’t under distress, or it takes time. Whichever way you go, that’s something that didn’t necessarily have to happen. By planning, working, and saying, “What are our redundancies?” Every business should have redundancies, especially for the things that are critical. What if Riverside didn’t work? You probably have Zoom as a backup.

That has happened more than once.

For me, we have two different ways that we can take money from people. We have two different systems that we use. We do good work. We’ve got to get paid. We’ve got to pay our people. If we can’t collect the money, that’s a problem. How many businesses have two ways to collect money? How many businesses have proper redundancies? These are all ways that money walks out.

We talk about having redundancies. There are things that are worth investing in to save yourself from headaches later. Having two different systems running parallel will cost you more money, but because you have two systems running parallel, you could potentially charge your clients more and be less likely to end up in trouble when something goes wrong, which means you’re not going to pay for it down the road.

There are different perspectives. Insurance protects you, but insurance costs money. Is insurance an expense, or is it a protection for later? Is it an investment? Is insurance something that makes it so that you don’t have to hold onto as much reserves, and suddenly, insurance is freeing up your money? This is a segue from the redundancy thing. With redundancies, you could look at them as cost centers, but you can also look at them as investments in your infrastructure or in enabling you to guarantee that you can get something done because you know that you have the backup system should System A fail.

Optimizing Resources, Implementing Redundancies, And Future-Proofing

There are two big takeaways here that I’m hearing from you. The redundancies are extremely important. For instance, I live in the country. I have two internet service providers, so if one goes down, most likely one of them is still up and running. I have to be, especially when I’m working from home, on my computer, on calls and meetings all day. That keeps me from going to a place where I go dark, and I cannot be connected. Those are important. That’s one redundancy as an example in life.

What I also love about what you said is that there are certain things for your business that you should invest in to save you from future pain. I never thought about insurance being a catalyst to free up capital. If you have a good insurance provider and you have an insurance claim, and you can get paid in a week or two from that insurance provider, you’re not worrying about having to have as much in reserves if you have a good insurance plan. For our audience of entrepreneurs and business owners, are there other things that they should be considering that could financially save them from future pain that they could implement into their businesses?

There are HR related things. If your people are legal and you’re compliant, when it comes time to sell your business, that’s going to be a big headache you don’t have to deal with. You’re also less likely to get sued now or after you sell. This one might help them right away. It might not even be down the road. If you treat your people well and do things right. You may have happier customers or clients. If you take care of your people, they take care of everything else. Invest in things like that around HR and around legal.

What’s the cost of not having a lawsuit, or what’s the value of not having a lawsuit? How much would you pay so that someone doesn’t sue you in 6 months, 1 year, or 3 years? Have your stuff set up correctly. Two that come to mind are HR and legal, but I’ll extend it to everything. It’s like hygiene. Why do you brush your teeth? 1) People won’t say you smell, but 2) If you brush your teeth, it’s going to protect you down the road. That applies to business hygiene.

My sales coach, and I’ll give him a shout out, is Jeff Goldberg, based on Long Island. He likes to say that every day that you’re not prospecting, 1 day, 3 months down the line, you’re going to be hungry. He’s like, “The business I signed today is because of the people I met three months ago.” That’s hygiene. That’s not doing anything for today.

That’s the answer. That’s how I would frame it. It’s your hygiene. We can throw in finance, too, because I gave all those other professions plugs. Doing financial hygiene and looking at your results, not just looking at the cash in the bank, is going to help you understand whether you are profitable, whether you are sitting on cash, or how profitable you are.

Understand that the cash that you don’t have is money you’re never getting back versus money that you could collect, versus money that you think you’re owed but you aren’t because of something or because you didn’t deliver. Understand. Give yourself the knowledge of what’s going on so that you can properly plan. Look a few months into the future and say, “Here’s where I’m going to be in 3 months or 2 months if I make these 6 changes.” Every change you make is going to impact what’s going on later.

Have a proper team so that you can trust the data you’re getting. Dig in to understand profit versus revenue. Those are not the same. “We grew revenue, but we lost margin.” Was it worth it? If you don’t know, how do you know what to press on? You’re going to go tell the marketing people to market and the sales people to go sell, and they’re about to be selling much stuff that’s not profitable anymore.

Checking For Financial Hygiene In Businesses

The businesses that you work with, when you go in, how are you checking for proper financial hygiene? Are there certain red flags that you look for right off the bat?

We often start with an assessment. The first step, when we go in, is trying to understand people, process, and profit. What we do in that assessment is start by asking for information. Depending on what comes back, how long it takes to come back, how they answer our questions at the quality of the information, as well as how the team is able to communicate gives us a good idea of what’s going on with their financial hygiene.

You might have money in the bank. We’ve seen this. If you misclassify deposits as sales, then everything is wrong. You can’t trust any of the numbers anymore. Deposits are money you’ve got now for a sale you’re going to make in the future. That means this period’s numbers are wrong because you overstated the revenue, and the next period’s numbers are wrong because you understated revenue. Next period, when you come knocking on the door and say, “Why aren’t we making money?” It’s because you’ve misclassified in the last period. The cash came in the door then, but you spent it already before the year even started.

Having the books put together and people who understand what they’re doing are the basics. There are policies and procedures. A lot of stuff is electronic. What happens when money comes in? Who approves new vendors? There’s a lot of financial hygiene and things that will help make problems down the line less likely.

This is a very good interview. As we always have some pre-topics we think we’re going to discuss, I don’t think we’ve covered any of them, but we got a lot of good highlights here. I have one important question for you before we go into the Rapid-fire section. Let’s say you’re a small or mid-size business and you are looking to level up your game when it comes to financial management, but you can’t afford that full-time CFO. What should you be looking for from a fractional CFO that will drive success in your business?

I’m going to go back to, it depends. Every business is different, but the value of a CFO, if that’s what you need, the value of the CFO is having that person on the team. It is having the person who, when something comes up, is not just looking at sales, but they’re looking at profit. It is having that person who’s thinking 2 or 3 steps down the line on the financial impact, both cash and profitability.

It is having the person who understands the structure, who’s seen it before, and who knows what we’re going to need, so that you don’t fall into it. They’re like, “If we want to do this, we’re going to need more billers. We’re going to need more whatever it is.” As I see it, that’s the value of the CFO. It is having that person on the team who understands what’s going on.

There are a variety of things that we do. We do something called financial planning and analysis. We do that for full-time CFOs. We help them with forecasting, complex analytics, and things like that. You need that, too. If that’s what you need, that’s what you need. The value of a CFO or a Chief Financial Officer is someone who has that broad view.

Often, CFOs manage HR. That could be an administrative task, or it could be thinking of it as they’re managing a critical input in our organization. It’s not just capital. It’s not dollars. It’s human capital. How are we managing that both from a cost and an investment perspective? Having someone who understands all that and who thinks that way is going to be very helpful.

For some small businesses, what they need is not a CFO. We found this particularly with founders. They’re like, “I don’t need anyone to tell me what to do, but I need to understand the interaction of A and B.” That’s a little bit of a different type of role. Often, that falls more into financial planning and analysis, which is like, “I need better information. I don’t just need the bottom line net income. I would need to understand how that works by product line.

I need to understand how much of my marketing spend showed up in last year’s P&L but was tied to this year’s revenue and profit. Maybe this year wasn’t that profitable because we spent all that money marketing last year,” or on the flip side, “That was a great ROI. That’s what we need to do more of this year to invest next year.” You may or may not need a CFO for that. It’s something that we help with as well. We are building out our team that works on that.

Rapid Fire & Key Takeaways: Connecting With Gershon

That’s awesome. Are you ready for Rapid-fire?

I’ll do my best.

Coffee or tea?

Coffee.

It’s a zombie apocalypse, and you have to get out of the house and protect your family. What is your weapon of choice?

Taser.

That’s my first taser. Great answer. Do you have a favorite book that you would suggest all entrepreneurs read?

Yeah. There’s a book I have that I would recommend to anyone who is a growing entrepreneur. If you’re running a 1,000-person business, I don’t know. This book over here is called Pick Up the Phone and Sell by Alex Goldfayn. Someone on our team told me they got me another book by him. It’s a mindset on how to approach helping people. It’s not about sales, but it’ll help facilitate sales.

I know this is not Rapid-fire, but one of his very common things is, “Did you know that we also do? What else do you need that we can help with?” Having a mindset like that will help you when you’re small. Inculcating that mindset into your team as you grow is very important. It has nothing to do with traditional sales. My doctor does it. You walk in for whatever blood work, and he’s like, “Did you have your flu shot?” It doesn’t come naturally to everyone.

That’s very true. What are three money-saving tips that you would give to an entrepreneur and business owner?

Focus on spending money wisely. My money-saving tip is to understand what capacity you need, and don’t overbuy. Unless you’re in gross mode, then maybe you want to overbuy so that you can fulfill. That’s one thing. Don’t overbuy. Get a handle on your capacity so that you don’t overbuy. Next is if you hire people who fit into certain categories and there still are tax credits out there, look into those.

The third money-saving tip is more important than all the others. Understand the terms of any loan or loan-like agreement you make. I’ll have someone call me, and they’re like, “I’ll borrow money. It’s at this rate.” It’s not at that rate. It’s that rate for three weeks. If you amortize that, you’re paying 1000% or something like that. Maybe you’ve got someone who’s not taking advantage of a discount. If you don’t take advantage of a discount, depending on what the discount is, that could be costing you a tremendous amount of money. Borrowing money could be cheaper.

You have to understand what you’re doing. You don’t want to borrow money from the bank for no reason, and then not realize what’s going on. If by paying 20 days earlier, you’re saving 2%, that’s a very good ROI on money. It goes back to what we discussed before in terms of opportunity cost. If you use your line of credit to save 2% and then you don’t have the inventory, which you’re making 30% on, then we can amortize that 2%, but you lost a lot more with that can of Coke that walked out the door because all you had was Tab or the store that people don’t drink.

Last question for you. Give me two key people in your life who helped you build the success that you have.

When I decided I wanted to do this, I went to my wife and asked her if she was okay with it. I don’t know if she was, but she said she was, so I ran with it. She gets a lot of credit.

Who else?

Our amazing team. I’ve had many people on, probably 10 or 12. People come, and they don’t always stay forever. The team that we’ve had has been top-notch. I can give credit to my first client, my first partner, the people who trusted in me at the beginning, and all those people who continue to trust in me. It’s not about me. It’s about the team. My final answer is our amazing team.

Please tell the audience where they could connect with you if they would like to do so.

These are places to connect with me. My phone number is (516) 256-9478. My email is Gershon@ImperialGRP.com. LinkedIn is LinkedIn.com/in/GershonMorgulis. If you Google Gershon and Imperial, they’ll probably come up with it. I’d love to hear from you. Put in the notes that you found us through the interview with Jarrod, because we get all sorts of spam from all sorts of people there. I am looking forward to hearing from you.

Thank you for joining us on the show.

Thank you. This was a lot of fun. I appreciate it.

Important Links

• Imperial Advisors
• Gershon Morgulis on LinkedIn
• Gershon@ImperialGRP.com
• Pick Up the Phone and Sell

About Gershon Morgulis

Gershon is the founder and principal of Imperial Advisory. In this role, Gershon has provided CFO services for companies across a wide range of industries, acting as an advisor to CEOs and CFOs on issues relating to both day-to-day profitability and long-term strategic growth planning. He began his career developing financial projections and working on special projects relating to Nassau County’s $2.7 billion budget, before continuing on to work in the bond industry as both an investment banker and issuer. In addition, Gershon has served as an Adjunct Professor of Finance at Touro College where he helped mold the next generation of business students.