Tag: firm management

What is EBITDA and Why Does It Matter to Software Development Companies

There are many ways to assess your company’s financial performance, profitability, and overall financial health. One of the most common is to look at EBITDA. EBITDA stands for earnings before interest, taxes, depreciation and amortization. In other words, it’s the revenue your company brings in minus standard operating costs like salaries. It’s helpful to look at this figure since things like interest, taxes, etc. are variable and can change over time.

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The Key to Growing Your Company? Knowing Your Company

Too often, companies that have the standard off-the-shelf firm management tools try to use all of the many metrics they provide to track, manage, and grow things like their revenue and profitability. That’s where we were many years ago — juggling dozens of figures without knowing which of them would have the biggest impact on our financial health.

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Profitability 101: What We’ve Learned Along the Way

If you’ve succeeded in growing revenue but aren’t seeing profitability keep pace, you aren’t alone. That was the position we were in for years, and it’s an issue for many companies today. In our case, we learned that relying on the typical, single-focus firm management systems for project tracking, resource scheduling, and other tasks wasn’t giving us the holistic perspective we needed to run our business effectively, grow profitability, and increase firm valuation.

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