'Profit first' is better for entrepreneurs than 'G.A.A.P.' | Mike Michalowicz | TEDxFultonStreet

This talk was given at a local TEDx event, produced independently of the TED Conferences. Mike explains how he made over a million dollars and then lost it, from a form of bad thinking pervasive among small business owners. "Generally Accepted Accounting Principles", a.k.a. "GAAP", describe profit as 'what remains after expenses are subtracted from revenue'. A simple transposition, Mike suggests, extracting an owner's profit before paying expenses, can help entrepreneurs to avoid making the same mistakes.

Mike Michalowicz (pronounced mi-’kal-ō-wits) started his first business at the age of 24, moving his young family to the only safe place he could afford – a retirement building. With no experience, no contacts and no savings he systematically bootstrapped a multi-million dollar business. Then he did it again. And again.

Now he is doing it for other entrepreneurs. Mike is the CEO of Provendus Group, a consulting firm that ignites explosive growth in companies that have plateaued; is a former small business columnist for The Wall Street Journal; is MSNBC’s business make-over expert; is a keynote speaker on entrepreneurship; and is the author of the cult classic book, The Toilet Paper Entrepreneur. His newest book, The Pumpkin Plan has already been called “the next E-myth!”

About TEDx, x = independently organized event In the spirit of ideas worth spreading, TEDx is a program of local, self-organized events that bring people together to share a TED-like experience. At a TEDx event, TEDTalks video and live speakers combine to spark deep discussion and connection in a small group. These local, self-organized events are branded TEDx, where x = independently organized TED event. The TED Conference provides general guidance for the TEDx program, but individual TEDx events are self-organized.* (*Subject to certain rules and regulations)

[richardrodriguezrodriguez]

Love this! And the best part is that this principle not only holds for profit in terms of money but as profit as satisfaction, in general.

[redcomic]

Wow Steve from Blues Clues turned into a savage businessman

[RadhaKrishnaMolluruCoach]

The formula I practice is:
Income - Savings and investments = Expenses

[bethanyniccum]

Love this book, Mike is fantastic!! Thanks for the inspiration!

[hvovpmf]

Makes a lot of sense. Will try that in my next venture. Thanks for your time.

[thetinojr]

Thank you for sharing your insightful journey and experiences. Your story is not only humbling but incredibly inspiring. It reminds us that resilience and innovative thinking can transform challenges into opportunities for growth and success. Truly grateful for your wisdom and encouragement!

[MattSteinman]

I need to re-read this book! Thanks, Mike!

[coachkenny]

This should have alot more views. Just read the book

[hazim]

this is always my formula in my life! take what you want and spend the leftover.

[flordaniellemalingin]

Wow. Watching this on a Valentines day.

[tonythaiger]

This is exactly like pay yourself first methodology. Gotta pay yourself first OR big corporations will jack your dough away instantly

[kuniyazu]

Simple and effective! And easy to remember .

[pcfradkin]

I feel like this would be great if I actually knew how to implement it. Managing my finances as a freelancer is hard enough as is, switching everything up feels super intimidating...

[itsmemasud]

started reading 'profit first'
and already created my profit account.
lets see what comes next :)

[nicholasolivas]

Hmm. What if sales change from month to month some businesses are seasonal? Some cost of goods sold go up as you increase sales.

[alexarima]

Estou lendo o livro Profit First, e fazendo uma busca, cheguei neste vídeo.
Acredito que o autor não tenha conseguido, em poucos minutos, explorar o conceito poderoso que está atrás do Profit First. Recomendo a leitura do livro. A palestra foi fraca.

[LaurenSho]

what account does the money for your expenses get put into?

[GA-nvjn]

Makes sense, just not the way he articulates it.

[blackjackool]

Thats how literally everyone does business. Isn't it?

[AberliteGrooming]

Great book, not that good presentation