Leading Finance Expert Shares 4 Tips for Biz Owners as SVB Crisis Unfolds

Published by Zara Shepherd-Brierley at March 15, 2023

Tags

Marguerite Pressley Davis is a former Goldman Sachs analyst turned serial entrepreneur. She is the powerhouse behind Finance Savvy CEO, a unique ed-tech fin-tech platform that is helping transform the lives of small business owners around the world. This week amidst the SVB crisis, she offers up her wisdom to help businesses avoid a future crisis.

As the founding partner of business strategy and financial coaching agency Marguerite Pressley Davis Inc, she has helped thousands of business owners transform their companies into profitable enterprises.

Back in 2022, Urbangeekz partnered with Finance Savvy CEO to provide five scholarships to support women-owned and minority businesses. Earlier this year Pressley Davis come on board as a sought-after coach for the Geekz Ventures inaugural cohort.

As the Silicon Valley Bank crisis unfolds, Davis gives readers her hottest tips to help small business owners & entrepreneurs make better, more confident financial decisions. Amidst all this uncertainty, Davis reiterates four golden rules for business owners and entrepreneurs to live by.

1. Do not hold more than $250K in any one bank. Period. I live by this rule. FDIC only insures up to $250K! So if you have multiple accounts at the same bank, The FDIC is going to add together all single accounts owned by the same person (you) at the same bank and insures the total up to $250,000. Anything over that amount is uninsured. Anything uninsured is at risk.

2. Understand how much cash you have across your accounts at any given time. I joked a while back that I check my account balances every day, but seriously, I do. As an entrepreneur I want you to be comfortable checking your accounts and knowing how much is in there down to the penny. This is something that you need to do at a minimum weekly! In times like this when a bank is going through such a transitional period, it’s imperative that you know where your account balances stood and stand at any given point in time. Also, knowing when something is off in your account can only be noticed if you’re frequently checking.

3. Establish a cash reserve. A cash reserve is money that you’ve put aside that you’re saving for an emergency situation. (YUP, what’s happening with SVB would be considered an emergency situation for any account holder.) My goal for you is to have a minimum of a 6 months cash reserve sitting in a national bank that’s local to you, that’s easily accessible and easy to withdraw needed funds the day of. Meaning that if you needed to, you could fully cover 6 months of your operating expenses from your cash reserve. So let’s say your monthly operating expenses are $10K, well then ideally I want you to have $60K in a cash reserve account (6 months x $10K per month).

4. Establish banking relationships. I want you to have such close relationships with your business banker that they know when your next vacation is. These relationships are critical to feeling comfortable discussing your banking needs during challenging times. A relationship with your banker also helps them to provide a tailored account for your specific needs. There are many helpful business banks I recommend in the Finance Savvy CEO resource hub if you’re looking to build new relationships or simply diversify your accounts.

Davis’ latest round-up of advice and hot tips mark her commitment to helping business owners and entrepreneurs navigate the stormy seas of the current financial climate, build financial confidence, and make profit-driven business decisions. You can check out Finance Savvy CEO’s membership schemes here.