There are two important considerations that esports business owners need to address: Financial Oversight and Financial Insight.
The first is the key to day to day survival. The second is essential for thriving over the longer term. Importantly, Financial Insight includes providing ‘fresh eyes’ that can discover opportunities, expose issues that are in plain sight and avoid the ‘financial tunnel vision’ that can occur when financial managers are too close to a business.
Financial Oversight starts with allocating someone in your organisation to take responsibility for your business financial affairs. If your business is newly founded, it’s likely to be you.
However, if you’re more at home on a keyboard than on the books, the solution will be to hire an accountant. Then as you grow, engage qualified financial management staff who will not only help you meet your operational obligations but set a course for a financially successful business.
Being financially organised from the very beginning is the key. Implementing the correct structures and systems straight up, avoids the time and money of back-tracking to correct business and financial matters that may have been overlooked.
In my experience the growth trajectory for esports businesses is usually rapid, and the advice required is not usually within the scope of generalist accountants who quickly find themselves out of their depth.
Financial Insight (a step up from Financial Oversight) is a higher-level approach to financial management. Day to day operational needs are attended to while proactive planning ensures the business can fund and manage expansion, take advantage of opportunities and survive unexpected setbacks that can be symptomatic of fast moving businesses.
For many start-ups, as well as maturing esports businesses, it is not financially viable for a full time senior accountant or Chief Financial Officer (CFO) to be on the payroll.
An alternative is to engage a specialised External CFO service.
This type of high level financial management service is new and best suited for esports business owners who must manage important compliance matters and navigate complex financial and tax matters but who do not wish to engage or manage an inhouse accounts team or CFO.
Over the past few years I’ve worked with esports business owners to develop a specialised External CFO service that is cost-effective and practical.
While a strong understanding of the accounting, tax and financial management needs that are unique to esports businesses is essential, technology also plays an important role in the service delivery. That is, cloud accounting systems must be tailored to meet the specific needs of each esports business. This ensures availability of accurate, real-time financial information that is then communicated via teleconferencing to esports business owners wherever they may be in the world.
Depending on requirements, an External CFO can attend to the day to day operational accounting, compliance reporting and strategy and for larger organisations, provide support for internal financial management teams.
As I said at the start, as an External CFO working for esports business owners, an important part of my role is to provide ‘fresh eyes’. I help business owners and their financial teams to avoid the ‘professional tunnel vision’ that can occur when they are simply too close to the business by bringing financial leadership and alternative thinking due to exposure to a wide cross section of business and financial management experiences.
Your next steps…
Review your systems and ask: Are they default systems or tailored to your needs as a specialised esports business?
Consider whether the business and financial management advice you are receiving will allow you to survive beyond the hype to become a financially sustainable and successful business that will allow you to enjoy personal wealth.
Understand and plan your Australian and international tax obligations in advance so that you pay no more tax than is necessary.
Implement quality financial management early in your business development so that your esports business can thrive in a rapid growth environment and survive any financial setbacks that may occur.
For more details about implementing a cost effective External CFO services that delivers specialised esports business financial oversight and strategic financial insight please contact me on shane@makecentsaccounting.com.au
For more information please read:
Read our esports Scene blog
Read our esports Business blog
Read our esports Tax blog
Read our esports Case Study
Read about me – Shane Kouros
