RKease Founder Journey: Musical Bookkeeping 2
- Rashidi Kabamba
- May 7
- 3 min read
"Making good judgements, when one has complete data, facts, and knowledge, is not leadership, it's bookkeeping." - Dee Hock
"Understand data to keep my books, to make great moves so I won't be overlooked." - RKease Company
It's been a couple of months, since I have wrote a blog because I have been busy with school, songwriting, and moving in to my own place. Nonetheless, I feel that it's important to speak on the importance of my bookkeeping experience and the insights that I have found from going through this process. I haven't submitted my tax return yet, but I will have to soon so that's crucial.
The bookkeeping software that I used in order to do my tax return is Wave Accounting because Wave is user friendly, has so many blogs which provide instructions and insights on how to navigate my bookkeeping endeavour. I literally spent about three to four months just on Wave's blogs learning and taking notes on bookkeeping to soak up all the information so that I can prepare for my tax return. After finishing my bookkeeping for the year, what I realised is that I am in the Valley of Death that many start-ups actually go through due to my expenses and revenue ratio. Before, I explain the Valley of Death let me explain my profit and loss statement.
When it comes down to my business, I only made an income of $2.01 and didn't have any cost of goods sold, but to operate my business, it cost me $920.91 in the year for my operating expenses. Now majority of my expenses are related to software and computer hosting, therefore it correlates to exactly what I was saying last time about Microsoft CEO stated, that "every company is a software company".
The majority of my expenses are computer related, therefore, with my insight I realise that I am a digital musician. Therefore, Satya Nadella's words seem to strike a chord with me, more than not because I realise that software is the main driver of my expenses, that I am paying for. Nonetheless, music technology is just as important as the music itself because even though you have artistry, technology brings you an infrastructure. Therefore, you need to invest in that infrastructure in order to develop your online presence, brand, and overall business as whole. Another concept, that I have learned is the "Valley of Death".
The Valley of Death is an important concept that every start-up or venture whether you're in technology or music is necessary to figure out. According to an article by Harvard Business Review, (https://hbr.org/2022/04/an-entrepreneurs-guide-to-surviving-the-death-valley-curve) the valley of death is, "The so-called “death valley curve” represents a crucial early phase of new ventures, when substantial work on a new enterprise has begun but no sufficient revenue has been generated." In order for a start-up or business venture to survive the valley of death, I think of this quote from economic history.
Adam Smith the father of economics stated in the Wealth of Nations that, "capitals are increased by parsimony, and diminished by prodigality and misconduct." Therefore, when you are building a business you must be lean and frugal with your finances and invest in revenue generating activities. If you are going to invest in something, such as technology, marketing, or any other assets it must produce revenue or lead to the revenue generating activities to keep scaling your venture. This is one of the reasons why someone breaks out of the valley of death because it's usually a 1-3 year period where you see no revenue, but you have to be adaptable, shrewd, and make many pivots so that you can your business can survive and eventually make it on top.
Starting this venture has taught me so many things about running, operating, and surving at business. Bookkeeping and finances are the foundation and engine which keeps the business going and with that it forces you to be frugal, lean, and add financial skills which will help in your personal or professional life. This experience has taught me patience, endurance, and adaptability because by starting the business I have learned skills which will reward me for the rest of my life. I hope you enjoyed the blog, and your day is full of rest, kindness, ease, peace!
Comments