A people and culture expert who gave up her leadership salary to launch her own consultancyApr 29, 2022
Kat Searson, the founder of workplace wellbeing consultancy Tula, on how her relationship to money changed when she founded her business.
What was your financial situation when you started Tula?
I took a huge pay cut. I’d gone from a high salary in a leadership position to less than the first job I had out of university, and I had to make a lot of personal sacrifices. I had to say no to hen dos, no to holidays, no to new clothes. And it did impact my relationships — I remember some friends not quite understanding how tight I was on cash in the first three to six months of starting the business.
I did save money to finance this. I’d given myself a six-month buffer, knowing that I was going to modify my lifestyle a lot.
How did you keep costs down while getting your business set up?
I was really fortunate to get a lot of support at the start — for example, a friend of mine is a videographer, and she made a video for me for free. I didn’t even ask for it. I also had three people offer voluntary support for the business, and there was a Unilever internship programme where they would fund interns, so I had support that first summer.
But a consequence of this was that because I felt people were being so generous to me, I felt the only commodity I had to offer back was my energy and time. That was a big learning for me — what’s the cost if you’re not paying people with money?
How long was it before you felt confident handling your business finances?
It was all quite crude for the first year. With my business being service-led, all new business coming from word of mouth, and launching just before the pandemic, one thing I found quite difficult to do was financial projections. For the first year you’re stress-testing, experimenting, trying to understand if there are seasonalities. But it did feel quite random, and this is still tricky in my line of work.
I’ve been working on productising what we offer, with a suite of workshops, including our hero sessions (the top five most popular sessions) which we now promote the most. This helps us focus on solving a collective problem rather than individualising our offering with every client, and making it harder to plan, predict and forecast.
What’s the most financially stressful situation your business has been in?
In October 2019 I had three major clients who were late paying me by about three months, and I ended up having to put the inheritance my granddad left into the business to pay people I was working with. That was really stressful, and it made me renegotiate my payment terms with clients.
I would say always ask for at least 50% upfront payment if you’re doing work where you’re having to pay other people, and then 50% within 30 days of delivering the programme at the absolute maximum.
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