This week, Maggie is chatting with Kelsey Sheehy, a small business expert at NerdWallet. In this episode, they talk about the challenges women entrepreneurs face when starting a business.
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Kelsey Sheehy is a NerdWallet authority on small business. Her work has appeared in The New York Times, USA Today and The Associated Press, where she writes a column about millennials and money. Kelsey has appeared on the “Today” show, NBC News and “ABC World News Tonight” and has been quoted by the Los Angeles Times, CNBC and MarketWatch, among other publications.
To learn more about Maggie and her coaching and speaking services, visit www.maggiegermano.com.
Maggie Germano 0:05
Hi, and thanks for listening to the money circle podcast. I’m your host, Maggie Germano, and I’m a feminist and a financial writer, speaker, educator and coach for women. I’m passionate about making personal finance less scary and more approachable so that women can improve their relationship with money and take control of their finances. Every other week, I will interview an amazing, inspiring woman to talk about the issues that impact our money, our health, our independence, and more. We will touch on the societal and structural issues that we need to work together to change and the actions that we each have the power to take in our own lives. If you’d like to learn more about me and the work that I do, visit my website at Maggiegermano.com or follow me on Instagram @MaggieGermano. Thanks again for listening and I hope you enjoy.
Maggie Germano 0:54
Hey there, and thanks for listening. I’m your host Maggie Germano. And this week, I’m chatting with Kelsey Sheehy, a small business expert at NerdWallet. In this episode, we talk about the challenges women entrepreneurs face when starting a business. Kelsey also provides details on the funding options available for women looking to start a new business and guidance around loan forgiveness for those who took PvP loans out during the pandemic. If you are a business owner, or you hope to be in the future, this episode is for you. Enjoy.
Maggie Germano 1:34
Welcome, Kelsey, thanks so much for being here today.
Kelsey Sheehy 1:38
Thank you for having me,
Maggie Germano 1:40
of course. So why don’t you tell us a little bit about who you are and what you do?
Kelsey Sheehy 1:45
Well, my name is Kelsey Sheehy, and I am a writer for The Personal Finance website NerdWallet. And I am the resident small business expert.
Maggie Germano 1:54
That’s great. And as a small business owner myself, I think having plenty of people out there who can give us information and help us make sense of being a small business owner, the more the merrier.
Kelsey Sheehy 2:07
Maggie Germano 2:09
So how did you find yourself in this line of work?
Kelsey Sheehy 2:12
so I’ve always wanted to be a journalist, something that I knew very early on. And I’ve just kind of gravitated towards roles where I can help people with complicated questions, specifically, money questions. I’ve been very fortunate in my career that if I’ve had a money question, it’s been my job to find the answer to it. And so it’s important to me to be able to, like give that information, those resources to other people.
Maggie Germano 2:37
Yeah, I love that. And I think with money, it specifically I mean, as a financial coach, myself, and someone who really likes to make money less scary for people more approachable, it is one of those topics that can be really overwhelming stressful for a lot of people. So I think being able to approach it in a way that you’re giving people the information they might be looking for in a way that is easier to understand, it really makes a difference.
Kelsey Sheehy 3:02
Absolutely. And even more. So when you’re starting a business. You know, getting your personal finances in order is one thing, but then you get into owning a business and running a business. And there’s a whole other level of financial questions. And you know, there’s just a lot more at stake. And so being able to break that down and make those choices easier for small business owners take just a little bit of stress off their plate is something that’s really important to me, and really important to NerdWallet.
Maggie Germano 3:30
Yeah, no, that’s great to hear. And so, you know, speaking of starting a business, and all the, you know, issues and questions that come up, what are some of the challenges that you see as people are first starting their businesses?
Kelsey Sheehy 3:45
I think the challenges particularly for female entrepreneurs boiled down to three things. The first is capital, women led businesses account for 40% of all privately held companies, but women run companies are significantly less likely to qualify for a small business loan, then businesses run by men. So that is a reality. Female business owners have to you know, work against and come up against. The other thing is legitimacy. And and this isn’t to say that women run businesses aren’t legitimate because they absolutely are. But women have to spend more time kind of proving their legitimacy to investors, to board members to prospective clients, and sometimes even to themselves. And I think that their thing is, is balanced. And we’ve seen this amplified with the pandemic, where women are leaving the workforce to run virtual schools and care for family members. And that’s something that especially if you have a family and you’re trying to start a business that you’re going to have to face and you’re going to have to work through how to navigate some some tough decisions and some trade offs and some compromise
Maggie Germano 5:01
Yeah, and that’s a lot of issues that cause complications. And a lot of it sounds like it’s outside issues outside of like ourselves, it’s not getting qualified for the loan or having a pandemic and being the one who’s kind of the default caretaker. So what are some tips you give women to help them try to get past that or, you know, overcome some of those?
Kelsey Sheehy 5:27
Yeah, you know, it does feel like there’s a lot of external forces that can work against you. But I don’t think women should let that discourage them from taking that leap if they feel really passionate about something. But some ways that you can kind of combat that some approaches you can take, my biggest tip is building relationships, relationships are so important when you’re starting a new business. And so we’re talking about relationships, building a relationship with your banker, you don’t want that to be just a transactional thing. You want your banker to know you to know your business and to know your goals. That way, when you need help, you know, whether it was PPP loans, or you need some help with a small business loan, you’re not just a faceless request. And so my advice to small business owners is if you don’t feel like you’re getting that relationship with your bank, consider looking elsewhere, you might find a more personal touch with a community bank, a credit union, those banks are also going to take a more holistic approach to lending. And so you’re not just going to be numbers on a sheet, they’re going to take into consideration your whole financial profile. So building relationships with your banker, but also build relationships with other small business owners in your community. Those people have been in the trenches, they’ve been in your shoes, and they know how to navigate establishing a business in your community specifically. So they can be really useful in terms of you know, who to talk to at, you know, in City Hall, or what banker was able to help them on a specific issue. But they’re also going to be just your biggest cheerleaders, there’s a ton of camaraderie around small business owners and a community. So they’re going to be up, whether it’s pop up events, or collaborating on a project, other small business owners are going to be one of your best resources, and your best ways to overcome some of those external issues like balance and legitimacy, because they can give you advice on how they will come in.
Maggie Germano 7:31
Yeah, that’s really good advice. And I think, for myself, as a business owner of one, you know, I don’t have any employees, I don’t have a partner in my business. And so having made connections with other business owners makes it so that I feel like there’s some, you know, networking that I can do as well as like that commiserating and feeling almost like I have unofficial coworkers like I have these monthly meetings with other women entrepreneurs, who, you know, where we talk about our businesses and our goals in those meetings. But it’s also a lot of just kind of, like, you know, talking about what is going on and asking for advice and like talking about wins and, and disappointments and all of that. And just like being able to have other people to kind of bounce things off of so that it feels a little less lonely because it can feel really lonely.
Kelsey Sheehy 8:21
Yeah, that is so important. I mean, owning a business, being responsible, whether it’s just for your own income, or having employees can be really isolating and really high stress. And so having somebody to bounce those ideas off of whether it’s, am I crazy for wanting to do this is this idea crazy. Having those communities whether they’re informal or formal, you know, there’s some great resources for mentorships IQ score is an organization that that I love, and they offer free business mentorship. And so you can get someone who’s who’s done this track, and who can really help you navigate those steps in your business, they can see your vision and they can help you get to your your end goal or pivot, which a lot of business owners have had to do and this last two years, and help you navigate all those changes. So you you feel prepared to have somebody to go to and you’re not just spinning internally on how to handle something.
Maggie Germano 9:19
Yeah, no, I totally agree. So what are some of the things that you wish that business owners especially women, kind of knew when whether they’re starting out or as they kind of go along in their business? What do you want to make sure people know?
Kelsey Sheehy 9:35
Well, actually, it goes back to what we were just talking about is that you don’t have to do this alone. You know, business owners wear a lot of hats, but you don’t have to wear every hat and know all the answers. So the biggest thing that I wish business owners would know is to ask for help when you need it, to seek out those networks and to seek out mentors to use you know, there are ton of free resources available to help business owners get established and grow and work through challenges. So whether it’s the SBA, the Small Business Administration, they have small business development centers, there’s also specifically women’s business centers. So there’s more, there’s run 100 of them around the country. And these are designed specifically to help women, start their business, grow their business, everything from counseling, to lending, some of these business centers actually lend themselves but they’ll help you find capital, if it’s not a business center that offers lending. In house, that’s really
Maggie Germano 10:39
great to know. And I know, for me, personally, the Women’s Business Center in DC, where I started my business was really, really helpful in just kind of helping me you know, brainstorm a business plan as well as, get helping me get through the being certified as a woman owned business for the government and those sorts of things. And like you were saying, If you don’t know where to turn for funding, or for other kind of support, being able to at least ask one place, instead of endlessly Googling and then kind of giving up, it’ll, it makes a big difference to have someone who actually knows what they’re doing.
Kelsey Sheehy 11:13
Yeah, well, and I think the thing also with being a business owner is, you’re, you’re great at the thing that you’re doing the business that you’re wanting to start, you might not be great at the accounting, or at the social media promotion, or the marketing and you don’t have to be, you can have people who help you along with that, or you can have those resources to teach you how to do that, you know, there’s so many webinars, I think, you know, things have gotten virtual in the last two years, so you have access to a lot more, you know, seminars and resources, then than you would have had maybe a couple of years ago.
Maggie Germano 11:49
Yeah, that’s great to know, too, because I think, with the pandemic, and you know, feeling even more and just being even more isolated in our homes, and not being able to kind of network as much just like recognizing that. Now, in a way, a lot of things are even more accessible, because there are a lot more virtual events and virtual networking, that maybe especially if you are parenting, and you have other kind of responsibilities at home that limited you from going to networking events, either during the day or in the evenings. You can have more access at this point.
Kelsey Sheehy 12:24
Yeah, there is some there’s a bit more flexibility around that. And you can have a wider reach of who you can connect with.
Maggie Germano 12:33
No, that’s great. So we’ve talked a little bit about the pandemic, and you mentioned finding funding and how a lot of people kind of didn’t, a lot of women owned businesses don’t always kind of qualify or get access to funding. With the pandemic, there was a lot of that, you know, pandemic relief funding out there for small business owners, including the PvP loan. So for those who received a PvP loan during the pandemic, what advice would you give to them for pursuing forgiveness? Because I know that that’s a big piece of it, too, that you know, being able to get it forgiven, so you don’t have to worry about paying it back. What kind of advice would you give?
Kelsey Sheehy 13:15
Yeah, the biggest piece of advice is don’t wait, you know, apply for forgiveness as soon as you’re eligible. And most cases, your lender is going to send you a reminder, they’re going to be on top of it and let you know, when your covered period expires, which is usually 24 weeks, but you can apply for forgiveness as soon as your loan funds have been spent. I think a lot of business owners that I’ve talked to thought that the process was going to be more difficult and more time consuming. And we’re really pleasantly surprised to find that it was as simple as kind of clicking a few buttons to get their loan forgiveness application submitted and that they had their funds returned to them within you know, a week or two. So don’t be intimidated. And really just apply as soon as you’re eligible to do so. The other thing that I would recommend with forgiveness is to keep a COVID file kind of have all of your records all of your receipts organized in one place. The nice thing is that most business owners don’t need to provide that information to qualify for forgiveness because most people borrow less than $150,000. But you want to still have that information on hand if you need it. If your loan gets reviewed at any point. It just kind of takes one stress element out of the process to have everything organized so you don’t have to go looking in different files and kind of searching around for the financial information that you need.
Maggie Germano 14:42
Yeah, no, that’s really good advice. And it’s it’s funny what you’re saying how people have been pleasantly surprised at how easy it is to get forgiveness. I mean, I had a PPP loan. Getting the loan was harder than getting the loan forgiven for me. So it was it was so funny because I had to apply more than once. And like the bank that I originally used totally, like screwed it up. So I had to go through a different one. And it was very frustrating. And so I was really nervous about the forgiveness part because it was like, oh my god, the way that this went, I just, I have no idea how this is gonna go. And it was like, you know, I got the email saying, like, Hey, this is the company that’s handling the forgiveness process, fill out this information. I went through the whole like, you know, process for filling in. And it was pretty simple. I didn’t have to even give very much information. And I had, like, you were saying all my documents that I thought that I would need. And I didn’t have to submit any of them. And they forgave it in like, two days. Like that was the easiest thing I’ve ever done.
Kelsey Sheehy 15:42
Yeah. So maybe and that, you know, that’s the case for the majority of business owners, you will hear some horror stories, or you’ll see reports in the media about people not having their loans forgiven, or it taking a really long time or being reviewed. But for most borrowers, it’s going to be that easy. And the application process was really complicated. And a lot of things change. It was a really fluid program, because it came together so so quickly, and was so massive, but the forgiveness piece of it really has been running pretty smoothly.
Maggie Germano 16:15
That is good to hear. And I feel like for things like this, it’s just it’s so surprising to me that it would be moving so smoothly, but I’m very happy to hear it. And I’m especially happy to hear that I’m not the only one that had it feel pretty easy. So are there any resources that PPP loan recipients should look into if they want a little bit more information on the forgiveness piece?
Kelsey Sheehy 16:41
Yes, absolutely. The best place to look is going to be the SBA website. There’s a lot of information on there. But the SBA also has links to find it counselors, you can talk directly to someone. They have webinars and training specifically for PPP loans and forgiveness, you can also work with the Women’s Business Centers or the Small Business Development Centers, those are going to be great places to go to have questions answered. Especially if you’re not getting questions answered by your lender, your lender really should be your first place your first point of contact, because they are the ones handling the process, shepherding this all through. But if you’re not getting answers from your lender, try the SBA, talk to an SBA counselor, reach out to some of those business centers that are available to you.
Maggie Germano 17:30
Yeah, no, that’s great. And I think I mean, something that’s kind of shining through with a lot of what you’re saying in this conversation is there’s just there’s a lot of resources out there, especially through the SBA and the Women’s Business Centers. There are people that want to help their resources, their support. And so the fact is, you do not have to actually be suffering through this alone.
Kelsey Sheehy 17:53
Yes, that is exactly right. There are so many people and so many outlets available to get help. It’s just a matter of reaching out, which sometimes can be difficult to do, or you maybe don’t know that, that that those resources are available, but they’re there and they’re ready to help you.
Maggie Germano 18:11
Yeah, so related to like, having it feel kind of difficult to reach out. Because I know some people, they’re afraid to ask for help. Or maybe they’re like shy, or they are worried of about asking the wrong question or something like that. Is there advice you would give to someone to kind of just allow themselves to ask for help or like, get that confidence in order to ask for help?
Kelsey Sheehy 18:35
Yeah, I mean, this is so true. And I think it’s something we deal with in all aspects of our life. But the you know, especially when it comes down to your business, the wondering and the worrying and the kind of trying to figure out it, figure it out on your own is gonna give you more headaches and take more time and more of your very limited precious resources, then asking someone for help. And so that’s the that’s my big piece of advice is that you always spend more energy worrying than you do actually getting the help. And it’s never as as big of a deal as you think it’s going to be I think we often go to the worst case scenario and then we realize like, Oh, that was simple like with PPP loans, you’re thinking it’s gonna be really hard to get it forgiven and turns out just refreshingly simple. That tends to be the case with with a lot of questions that we need to reach out to for help for
Maggie Germano 19:30
Yeah, I have found that too. And I think it’s it’s like the how people always talk about having, you know, the one thing on their to do list for weeks and weeks and weeks, and when they finally do it, it takes five minutes. And it’s like, I just suffered for weeks avoiding this thing. And now I feel better and it’s done. But I wasted all that time, actively and anxiously avoiding it. It’s the same kind of thing of like, worrying and worrying and worrying and not asking for help.
Kelsey Sheehy 19:56
Yes, it’s exactly that.
Maggie Germano 19:59
So I get that that takeaway is like, less time worrying more time taking the action of at least asking for help versus, you know, sitting back and wondering what could happen.
Kelsey Sheehy 20:11
Yes. And I think, you know, that’s that’s business owner, you know, that’s being a business owner is you have to take action, you don’t have time or money to waste. And so, you know, reaching out to experts and relying on other people kind of goes back to what we said before, about, you know, you wear a lot of hats, but you don’t have to wear them all. And you don’t have to have all the answers.
Maggie Germano 20:33
I love that I, I, I love that quote that you just said of like, you wear all the hats, you wear all the hats, but you don’t have to wear them all. Like, it’s it’s such an important thing to remember, I think, especially as a woman, I think that we tend to, I mean, whether it’s necessity, or our own pressure, but we tend to take on a lot more than maybe we should or maybe we can actually handle. And it can be really hard to remember, like, you have to drop the ball. Sometimes you have to pass off responsibilities to other people or, or reach out to the people that are actually the expert, like you were saying earlier, if you’re not an accountant for your business, why should you have to be trying to spend half of your time like figuring out the accounting side of your business, when you can ask somebody else for help if if you if it’s free? And also if you can afford to hire somebody?
Kelsey Sheehy 21:24
Yeah, that’s, you know, that’s exactly right. I think you’re speaking to my heart here. But in terms of just I think sometimes we tend to take on, you know, the bulk of the workload ourselves. And me personally, I’m not great at delegating. But when I do ask for help, when I do reach out and say, Hey, I need you to handle this, like, that’s just one less thing on my plate, that someone else can can do better than me. You know, that’s, that’s the other piece of it. So I think it’s it’s so important to remember that as a business owner, and just in life generally, you know, that’s would be one of the takeaways I have is to ask for help, whether it’s you know, asking, you’ve been friends and family member to like, pack orders, or, man, your social media account, or whatever it is that you need help with, for your business. Pull your community in, because they’re there and ready and willing to help you do that.
Maggie Germano 22:15
Exactly. I think we’d be surprised to know how many people want to help and are just kind of waiting for us to ask because it’s not like, you just someone knows that you need help. And maybe they’re sitting there being like, Oh, I wish I could be involved, like you said, like packing orders or doing social media. Like maybe maybe there’s a friend who wants to someday do social media marketing, but hasn’t had experience and wants to help but they just don’t know that you hate doing it and spend so much of your time doing it. So getting the courage and the confidence to actually ask people for help. I think we could be pleasantly surprised to see how many people want to help us.
Kelsey Sheehy 22:54
Yeah, you hit the nail on the head right there.
Maggie Germano 22:58
So is there anything else that we haven’t talked about yet, whether it’s about starting a business as a woman overall, running a business as a woman overall or PPP loan related that we haven’t touched on that you want to make sure listeners? Takeaway?
Kelsey Sheehy 23:14
Yeah, I think one thing that I would add to this conversation, and it’s not just for women, it’s for anyone who’s starting a business is, and this little sound really simple, but treat it like a business from day one, you know, take it seriously in all aspects. So get yourself a business bank account, keep those personal and business finances separate. Get accounting software, there’s a lot of free or really cheap resources out there to have your books in order and learn how to understand your financials, your cash flow, your your projections, your profit and loss reports. The other thing is to create a solid business plan. I think we’ve seen a lot of people who maybe started a side gig and then decided with a pandemic, I’m going to turn this into a full time, you know, I’m going to turn this into a full time gig. But now so that’s the time to really create a solid business plan. And you don’t map out what your long term your short, medium long term goals are, map out the financials, map out the challenges you expect to face along the way, that’s going to give you a roadmap that you can continue to go back to as you grow your business. It’s also going to show lenders that you that you see that you’re serious that you’ve thought this through, and you don’t want to scramble to kind of put that together when you need a business loan. You want to have that at the onset. So it can kind of be your navigating beacon along the way.
Maggie Germano 24:43
Yeah, that’s really good advice. I think, like you were saying it’s easier to start from the beginning. Even if it’s really small, you’re not making a lot of money. You’re not spending a lot of money as a business so it’s easier to kind of keep track from the beginning there. Then like when you’re full blown business and you need a loan, like you said, and it’s like, oh my god, where do I even start? I’ve been doing this for a year, and I am just overwhelmed.
Kelsey Sheehy 25:08
Yeah, and you know, the thing I hear over and over again, whether it was through PPP, or just from business owners, one of the best things that you can do is keep your books clean, which means keeping the personal and the business finances separate. So when you do you no need to, in a hurry, apply for an emergency, you know, lending program, you don’t have to sort through and find your business expenses from your personal ones. Yeah, it also makes tax time easier. And it’s a lot easier, like he said to do from the start, then to kind of reverse engineer your books and your processes to become more legitimate as your business grows. And you really need to have those things separated.
Maggie Germano 25:49
Yeah, that’s really good advice. I, I luckily, learned that very early on to and opened a business account right away. And I don’t always keep my accounting, like super clean and super organized. But at least I know nothing in my business account is a personal expense, or, you know, nothing in my personal account is a business expense. It’s like, I can just pull up my bank account, login to my business bank account. And that is where all of my business transactions are. And they’re stuffing, like complicated about that. So that is one thing I’m grateful to myself for, for knowing in the beginning, even if I’m not super great at keeping my accounting organized.
Kelsey Sheehy 26:30
Well, kudos to you for doing that. Because that is, that is a big first step. And you know, there, it’s, you know, maybe seems like a scary thing to have a whole separate business account. And you know, this is one step. But it’s actually it’s a really simple step. There are tons of free business checking accounts out there. That you know, and there are a lot of kind of, along with the theme, a lot of tools that these business banks offer to help you along the way. But just that small thing of having having your separate finances, having your business account separate, so come tax time, you can easily see here were my expenses, here’s my income, it’s all in one place for you.
Maggie Germano 27:10
Yeah, no, totally. And so are there any small or business bank accounts that you tend to recommend? I know that when I talk to people who are starting their own business, that’s something they kind of stumble, or it’s like, what where do I What, what bank Do I go to? And you know, worrying about fees and things like that? So are there any that kind of stand out that you recommend?
Kelsey Sheehy 27:32
Well, there are a lot of good options. I think one thing that we talked about earlier is looking at community banks and credit unions, they tend to have lower fees, and just that more personal relationship that you’re going to find maybe with a big bank, that said, you know, Chase has a great business checking account, if you qualify to have that fee waived. That’s the big thing. Your finances as a business owner are tight anyhow, you don’t want to be spending money on fees if you don’t need to be. And so NerdWallet actually has some great resources to help you find and you know, Dallas of our best free business checking accounts, and interest bearing checking accounts, even savings accounts. So if you’re curious about where to start, or where to look, nerd wallets, a great place to start that journey and find those financial resources.
Maggie Germano 28:23
That’s great. And I I’ve always really enjoyed NerdWallet of like just being able to kind of summarize those different things. Because again, like I said earlier, like you can google yourself till you’re blue in the face and still feel confused and lost. So being able to find a resource that distills that information into a way that’s easy to understand, and doesn’t kind of overcomplicate things, is really helpful. So I’ll link to NerdWallet, as well, in the show notes,
Kelsey Sheehy 28:51
we do that Google it until we’re blue in the face for you. So you don’t have to.
Maggie Germano 28:57
That’s good to hear. So how can people follow along with you and follow the work that you’re doing?
Kelsey Sheehy 29:03
Well, um, you know, you can visit NerdWallet. And that is going to be a place where you can follow my work, follow NerdWallet work, we’ve got a bunch of resources for small business owners to really kind of help you with all of those less than sexy financial decisions. They have to make everything from business insurance to payment processing providers, and business checking accounts. We’ve got kind of all that there, including, you know, some of those explainers like, what is the merchant processor? You know, do I need workers comp insurance? And so you know, if you want to follow along and learn more visit NerdWallet. We’ve got a lot of information to help you with your business.
Maggie Germano 29:44
Wonderful. And like I said, I’ll link to that in the show notes. So folks have easy access. But I wanted to thank you again for taking the time to chat with me today. I think you’ve given us a lot of really great advice and I think anyone who’s either thinking about starting Business are already kind of in the throes of it. This is going to be a lot of really helpful takeaways.
Kelsey Sheehy 30:05
Excellent. Well, thanks so much for having me. This was such a fun conversation. I really enjoyed talking with you.
Maggie Germano 30:10
Maggie Germano 30:11
Thanks so much. Thanks again for listening to the money circle podcast. If you want to learn more about my financial coaching services, my speaking and workshop offerings, or just to read my blog visit Maggiegermano.com. To get in touch with me directly email me at [email protected] You can also follow me on Instagram and Twitter @MaggieGermano. I look forward to hearing from you. Bye bye.
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