Why You Should Pay Yourself

Numerous small business owners, especially in the beginning, often forget to prioritize their own compensation. There's a perception that it's crucial to focus on getting the business off the ground and paying others first. However, it's essential to recognize that you are an integral part of the business, and compensating yourself is just as important as compensating others. Don't forget, your contribution as a creative deserves fair and deserved compensation. Treat yourself as a valued part of the success equation.

Is it true that investors will look at whether a business owner is paying themselves as a sign that they business is truly profitable?

Yes, it can be true that investors often consider whether a business owner is paying themselves as a factor in assessing the profitability and sustainability of a business. When a business owner pays themselves, it indicates a level of financial stability and success. It suggests that the business is generating enough profit to support not only operational expenses but also the owner's compensation.

On the contrary, if a business owner consistently neglects to pay themselves, it might raise concerns among investors. It could be interpreted as a sign that the business is struggling, and the owner is prioritizing the survival of the business over personal compensation. This might lead investors to question the overall financial health and viability of the venture.

Ultimately, how investors interpret the lack of owner compensation will depend on various factors, including the specific circumstances of the business, its industry, and the overall business strategy.