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I had a conversation with one of our team’s CPA the other day that genuinely pissed me off.
Not at him, at myself.
We were mapping out a new service offering, and he started walking me through what we’re now calling the profit waterfall. It bother me because it’s such common sense, I felt like a dummy.
It’s a method of finding more profit in your business by auditing your own P&L.
Here’s how it works:
Revenue: if you don’t have enough revenue, it comes down to 2 things: it’s either a pricing problem or volume problem.
Gross margins: are you selling the right product mix? Or is your lowest-margin stuff eating the pie?
OPEX: find duplicate subscriptions, overstaffed labor, and negiotitate vendor contracts.
Taxes: are you capturing every deduction or Government grant?
Every layer connects to every other part of the business. Pricing is a sales problem. Margins are a product problem. OPEX is a time problem. Your P&L diagnoses the entire business, but most owners ignore it, wasting 30% of profits every single month.
I've worked with hundreds of owners. $2M, $5M, $10M+ companies. These are smart, hard-working entrepreneurs, but when you talk about improving their EBITDA (for a higher future selling price), it is always treated as a future problem.
Unfortunately, “someday” doesn’t pay the mortgage. So we’ve started reframing the question. Instead of selling your business for 30% more five years from now, what if you had:
“An extra $15,000 in your pocket every month?”
We’re talking about:
Duplicate software subscriptions nobody’s reviewed in three years
Pricing frozen since 2019 while your costs went up 30%
Cash conversion cycles where you deliver in 30 days and get paid in 90 (hopefully)
Tax deductions you’re not capturing: the ****basic stuff, not Bermuda loopholes
Labor inefficiency: your $85K ops person spending 15 hours a week on tasks that AI can handle with 1 hour of set-up
McKinsey puts it at 30% of potential earnings left on the table for mid-market companies. If you're doing $3M in revenue, that's $50K+ per year just... evaporating.
So why don't people fix it? Present bias. The pain of changing systems today feels worse than some vague future payoff. "Sell for a higher multiple" is abstract. But "making an extra $10,200/month with a couple hours of work" is an immediate payoff that every entrepreneur should make.
I had a call this week with someone working with boomer business owners preparing to exit. She told me about a family business she works with runs their entire back office on paper. Yes, in the current year of 2026. You can only imagine the amount of profit that is being flushed down the drain in their business.
So that's what we built. The Exit Audit. You book a free call, our CPA-led team walks your profit waterfall, and we identify the specific areas where you're leaking money.
The guarantee: we will find you more profit in your business. If we can’t, we’ll give you $250 to take your spouse to dinner (even though you clearly don’t need the money).
Book your free Exit Audit: https://www.breakwaterma.com/exit-planning
How Jennifer Aniston’s LolaVie brand grew sales 40% with CTV ads
The DTC beauty category is crowded. To break through, Jennifer Aniston’s brand LolaVie, worked with Roku Ads Manager to easily set up, test, and optimize CTV ad creatives. The campaign helped drive a big lift in sales and customer growth, helping LolaVie break through in the crowded beauty category.
idea of the week 💡
Credit: ideabrowser.com
Problem: QuickBooks was built for businesses with one revenue source and predictable expenses. The creator economy has neither. A mid-size creator earns from ad revenue, subscriptions, digital products, sponsorships, and affiliate programs across different platforms — each with separate schedules and fee structures. A bookkeeper who serves creators spends hours just reconciling before the actual accounting starts.
Idea: Tenpay — a platform-connected accounting tool for content creators. It connects to creator platforms, imports transactions into reconciliation-ready books, and splits revenue from platform fees on every line item. Categorization rules learn from each transaction. Tax obligations update across income sources in real time. The bookkeeper's job shifts from chasing discrepancies to advising on them.
How it makes money: $49/month for solo creators, scaling to $199/month for bookkeepers managing multiple clients. A bookkeeper billing $150/hour who spends that hour on data entry sees the ROI on the first invoice. Distribution runs through accounting communities and CPA partnerships where reconciliation complaints surface daily. More transaction patterns means fewer manual corrections, which means more clients without adding staff. The tool that saves three hours a week becomes the system their practice runs on.
Why it might fail: Start with a single Stripe integration — most creator platforms route payments through it, so one connection captures a large share of transaction data without negotiating multiple APIs on day one. The real challenge: earning trust in automated categorization takes longer than building it. Recruit ten bookkeepers who each manage three or more creator clients and give them 90 days to break the logic. Success metric is reconciliation time cut in half.
workouts this week
at-home
EMOM (Every Minute on the Minute) for 20 minutes:
Minute 1: 15 push-ups
Minute 2: 20 air squats
Minute 3: 10 burpees
Minute 4: 30-second plank + 10 mountain climbers
Repeat for 5 rounds. Whatever time is left in each minute is your rest.
gym
Push/pull superset day. 4 sets of:
Barbell bench press: 8 reps + Barbell row: 8 reps (superset)
Overhead press: 10 reps + Weighted chin-ups: 6 reps (superset)
Dumbbell lunges: 12 each leg + Romanian deadlift: 10 reps (superset)
Cable flyes: 12 reps + Face pulls: 15 reps (superset)
Tips:
Rest 60 seconds between supersets, not between exercises
Go heavy on the compounds, controlled on the isolations
outdoors
1km jog (warm-up)
5 rounds: 200m sprint, 15 push-ups, 15 jump squats
1km jog (cool-down)
Finish with 2 minutes of stretching
tweet of the week
When I was in high school we sold coupon books for fundraisers… clearly we should have been selling diet pills instead
my plugs
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