Property Management Growth with DoorGrow DGS 62: Property Management Accounting with Taylor Hou
Are you an entrepreneur trying to figure out what you’re going to do with your life? Going from company to company to make money and find something you enjoy? During your career journey, you can learn a lot and build a network of people who come to you one day and ask for your help. You may end up with too much demand and work 80 hours nonstop every week.
Today, I am talking with Taylor Hou, who faced some of the same struggles. Clients kept coming back to him. Why? He discovered that there is great demand for people to clean up businesses’ financial and accounting books. The majority of property managers aren’t bookkeepers or don’t have accounting backgrounds. So, Taylor realized that if clients were willing to pay him to do their bookkeeping as a service, he could start a scalable company. APM Help now offers several services to more than 25,000 units.
You'll Learn...[05:15] Property management industry’s accounting duties are regulated via bank reconciliation (bank recs) where every bank account transaction is in some software. [06:36] 3-way tie out accounts for uncleared deposits and checks, which are liabilities. [08:42] Instead of one bank account per property, property based accounting keeps track of property balances. [10:05] Financial diagnostics report lets you troubleshoot to identify where money should be; transfer money to your account - if you don't, it’s in the wrong place. [11:12] APM Help is currently only available for AppFolio, but offers a level of expertise needed to understand how to do everything compliance related. [13:40] Software makes bookkeeping easier, but bank recs need to be approved by a broker; software companies can’t take on such liability, but APM Help can. [14:19] Humans make mistakes; audit your checks and balances by using Google's Eating Your Own Dog Food methodology or an audit program you create. [15:32] APM Help’s tool goes into your software, grabs necessary data, and crunches numbers related to state compliance requirements. [16:00] Top issues and red flags include security deposits in the wrong bank account, unaccounted for tenant liabilities, prepayments, and commingling of owner funds. [18:50] Don’t do or control everything - prevents growth and ability to scale; outsource bookkeeping, accounting, and compliance audits. [21:42] Accounting and Product Software Expertise: APM Help knows what works and doesn’t to be able to make decisions that move clients forward. [31:45] APM Help provides three main services: On-demand consulting, daily bank recs, and full charge bookkeeping. [35:17] APM Help is a resource for those needing to buy or sell a company; performs an audit to determine the financial health of the business - what it's worth.
TweetablesIf you're not doing bank recs, you need to do them.
Pivotal 3-way tie out is the Holy Grail of where you want to start.
Humans make mistakes, but most don't have a gazillion checks and balances.
We eat our own dog food. We're always hiring great people.
ResourcesGoogle's Eating Your Own Dog Food
DoorGrowClub Facebook Group