Sophia Amoruso | 5 Money Lessons Learned From Author of #Girlboss and Creator of Business Class

I came across Sophia Amoruso during my research on female entrepreneurs.

She has seen the highest highs and lowest lows. And, she is someone who does not stay down for long.

She worked as a campus safety host to survive. Worked on her eBay store on the side. Pivoted and turned it into a globally recognized brand in NastyGal. Made it big. Wrote a bestselling book and then struggled to keep the company afloat. From there she went ahead and created GirlBoss Media.

Now, she is focused on her latest venture Business Class.

In this article, I am sharing five money lessons I learned from her words.

You can use these in your business right now. Just by reading you will strengthen your financial knowledge and get ideas to apply to your business.

5 Cash Flow Lessons Learned From Sophia Amoruso

Let’s start with the first lesson.

Lesson 1 | Money looks better in the bank, rather than on your feet.

It relates to how we view money in the business.

Oftentimes we buy stuff without thinking about whether there is money in our business bank account or not.

Because in our society, people buy things, with money they don’t have and to impress people they don’t need to.

If keeping money in business is your biggest problem, then selling more will not solve the problem. So behavior is more important than money-making skills in this case.

In one of my research one on one calls, a female voice coach told me that she would rather spend £150 on a pair of shoes, rather than doing some website tweaks because it makes her feel good instantly.

How about instead of impulsive buying, you instill financial discipline in your business and treat yourself, after reaching a milestone. It doesn’t matter how small or big a milestone is, it is still a milestone that motivates you to do more.

It’s like going to the gym and not seeing the result for two to three weeks, and feeling demotivated. Then suddenly, we start seeing some results, and we get motivated to do more. Before we know it, we have reduced from size 14 to 12 and then to 10.

For size drop, is a milestone and to keep the motivation going, we treat ourselves. That’s how our mind and brain works.

You can use the same approach in your business.

But if you’re just buying for the sake of buying and even when you don’t have enough cash in the business, then you might run into cash flow problems. So that’s lesson number one.

LESSON 2 | Learning how to control your finances is one of the most important things you’ll ever do.

Many creative female coaches and consultants do the opposite.

They deviate away from the idea of how to control their finances. They think it’s not their area of strength and expertise as I’m a creative female entrepreneur.

Or they think that money is the byproduct of what they do. They believe as long as they make an impact in people’s lives, they should be okay.

Or, they say to themselves:

“All my business problems will be solved as long as I can make sales. I don’t have to care about anything else. So I would rather focus on marketing and getting new leads, to get more sales.”

They have these beliefs around growing the business.

But here’s the thing.

If keeping money is your biggest problem, So, no matter how much you make it doesn’t mean anything. I say this all the time.

The name of the game is to stay in the game until you win the game. So keeping money in the business is equally important as making money.

LESSON 3 | Treat your savings account just like another bill. It has to be paid every month or there are consequences.

So many businesses struggle and fail despite being a well-known brand, Even when they’ve been in the business for long enough, and even when they are household names.

They struggle when they can’t make sales for a month or two because they don’t have a cash flow cushion for 1–2 months, leave aside the recommended buffer of 3–6 months of cash flow.

You build this cushion, this buffer by treating your savings account every month.

When you save every month, you create stamina to stay in business when times are tough.

And without this stamina, your business will suffer if you don’t make sales for a month or two.

If this lack of sales continues for a business without a cash flow cushion, that business is screwed.

That’s why 82% of businesses fail because of poor management of cash flow.

To not be among these 82% businesses, and stay clear of all cash flow problems, set up a savings account and treat it just like another bill as Sophia recommends.

And when you do that in no time, you’ll be covered for three and then for six months.

And in the process, you’ll build a healthy profitable, sustainable and scalable business.

Lesson 4 | The more you experiment, take risks, and make mistakes, the better you’ll know yourself, the better you’ll know the world, and the more focused you’ll be.

Female entrepreneurs deal with all kinds of fears.

• The fear of losing money
• The fear of failing in the business,
• The fear of judgment, what people think of them,
• The fear of success, wondering if they deserve the success.
• And the fear of rejection that holds tight.

As a result of these fears, they don’t take action. They get stuck in analysis paralysis, procrastination.

Imposter syndrome kicks in and they say to themselves that they are not good enough.

Here’s the thing. If you don’t take risks or experiment then you will not know what works and what doesn’t work.

If you are thinking, I feel trapped in my business. I’m not moving forward in my business. I feel like I’m stuck in the business. and I should be further ahead in a business.

And you are thinking someone I know, a friend of mine, was far behind but now she is ahead of me. I see her on social media and she is posting wins and I feel I’m left behind. Then stop for a moment.

Because you don’t know the whole story of this person. You don’t know what she has gone through, mistakes she’s made, risks she took, money she lost. Mostly we see a success story.

To replicate someone else’s success in your business, you need to experiment, take the kind of risks they took, and make your own mistakes.

More so because there is no such thing as 100% certainty, about anything that we do. The only thing certain is that you are bound to make some mistakes along the way. And remember, mistakes are not mistakes. They’re the lessons learned.

Lesson 5 | Abandon anything about your life & habits that might be holding you back. Learn to create your own opportunities. Know that there is no finish line; fortune favors action.

I’ve realized one thing about female entrepreneurs, through my research that lack of financing know-how holds them back.

Because of this lack of financial know-how, as a female entrepreneur, you don’t know what’s happening in your business in terms of where you are right now to where you want to be, and what needs to happen to get there.

This is a big problem. But there is another problem that is bigger than this.

It is not creating a habit of learning and educating yourself. This is crucial if you want to be successful in business.

This is also how you implement what Sophia said and I shared earlier in this article that learning how to control your finances is one of the most important things that you will ever do.

So, if you want to go far in your business and impact the lives of a lot of people like Sophia Amuroso, create a habit of learning, educating, and implementing habits that are crucial for your growth.

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If you like videos more than words, then I published a video with the same content, you might want to check it out below.