Running a successful business isn’t just about generating more sales—it’s about managing cash flow, protecting profits, and making sound financial decisions before small problems become major crises. Yet countless entrepreneurs unknowingly sabotage their own businesses by confusing revenue with profitability, failing to forecast cash flow, and reacting to financial challenges instead of proactively planning for them.
In this episode of Build It to Billions, Brett Swarts sits down with Michael Barbarita, founder of Next Step CFO, to uncover why so many small businesses find themselves trapped in a constant cycle of cash flow panic despite growing revenues. Michael shares practical strategies for improving financial visibility, increasing profitability, and building a business that generates lasting wealth rather than ongoing stress. Whether you’re a business owner, investor, or entrepreneur preparing for an eventual exit, this conversation will help you understand how mastering your numbers today can create greater freedom, stronger growth, and a more valuable business tomorrow.
Episode Highlights Here:
Brett
Before we jump into this episode, I want to invite you to join our community to help you become a better steward, scale to billions, and ultimately give more or all of it away. All I want
you to do is to click the subscribe button right now. I love your support. It’s incredible to see your comments, and we’re just getting started. I can’t wait to go on this journey with you.
Thank you so much for subscribing; it means the world to me. Welcome to the Build It to Billions podcast, where we guide successful entrepreneurs and investors on their journey from millions to billions. We believe the key to scaling and compounding your wealth in life starts every single day with the mindset and practice of stewardship over ownership and applying billionaire biblical principles. Our ultimate goals have to scale and compound your wealth in life, so you can give more all the way to help MVPs. My name is Brett Swartz. In each and every episode, we’re joined by the world’s top entrepreneurs, millionaires, or billionaires, where they share their secrets, insights, and wisdom with us, so we can all compound and make a bigger impact. Hey, we’re also streaming on Capital Gains Tax Solutions podcast and YouTube channels. We also appreciate everyone watching out there. I’m excited about our next guest. He’s out of Massachusetts in the Cape Cod area, and you know he is here to help us find hidden profits, scale smarter, beat our competitors without the chaos cash flow panic that a lot of business owners are facing. In fact, we’re talking about solving cash flow overwhelm for business owners. We’re going to be diving into some CFO services and business strategy, and what you should be looking for in team members or consultants that you’re working for. Please welcome to the show with me, Mr. Michael Barbarita. Michael, how we doing?
Michael
Fantastic. Thanks for having me, Brett.
Brett
Excellent. For listeners getting to you for the first time, would you give them a little bit more about your story and your current focus?
Michael
Sure. So, all my life, I’ve owned retail manufacturing and service companies. The retail company I was I owned with some partners, and we grew the company from two and a half million to 8million in five years, basically utilizing some of the strategies that we’re going to talk about today. I then went into the frozen cookie dough business. That’s another business that I went into, bought and sold. And then I had a failure. I started an outpatient rehabilitation facility called Freedom Therapy Center, and I thought I, after having two successful exits, I thought I knew everything, and you know that’s the worst thing that can happen to a to a business owner that you think you know it all. And so, you know, it was funny because when I analyzed the whole thing after in the aftermath, when I was with the ski business and with the cookie business, I implemented business and financial strategies that my competition wasn’t doing, and then in the medical business that I went into, I did exactly what my competition was doing, and I tanked after five after like five years. So, I learned a lot, you know, as a result of that, and so that’s when I started Next step, CFO, because I just learned so much about success and failure that I thought it was a great opportunity to help other business owners. So that’s my story.
Brett
Hey, you’re best positioned to serve the person you once were or are, and I. It’s great that you’ve had successes and failures, and so that you can learn and help us to learn and not make the same mistakes, and we’re speaking with Michael Barbarita, and you can learn more about with him by going to nextstepco.net, nextstepcfo.net. Don’t say that too fast. But so, let’s dive right into this, Michael. Okay, so what’s the number one secret to solving cash flow overwhelm for the business owner?
Michael
Well, I think first of all you have to understand what the 8020 rule means in business. And so, for us, and when I was doing research for my book as well, I landed on what I call the seven-step pathway to profit formula, and what it is, what it represents is, to me in business, the 8020 rule is that 80% of your revenue comes from 20% of what you do every day. A little different from what most people now. The 80-20 rule is never wrong. So, if you if you think it’s 80% of your revenue comes from 20% of your customers. You’re right, so I’m not I’m not arguing that. I’m just saying that I think it’s more valuable for 80% of your revenue coming from 20% of what you do every day, and so I narrowed that 20% down to seven steps. One of them is leads. The second one is conversions. The third one is closing rate. Fourth one is client retention, which is very often neglected. By the way, client retention. We all, as business owners, we all like to think that once we get a customer, we get to keep them by default. Not the case. The fifth is average dollar per transaction. Fifth is the sixth is the free.
Brett
So, if you like this little, short clip of the interview I just did, click over here to watch the full interview, and please don’t forget to subscribe. Thanks so much, everybody.
Watch the episode here:
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About Michael Barbarita
Michael Barbarita is the founder and president of Next Step CFO, where he helps small and mid-sized business owners improve profitability, strengthen cash flow, and build more valuable companies through strategic financial leadership. With more than three decades of entrepreneurial and executive experience, Michael has founded, grown, acquired, and successfully exited multiple businesses across the retail, manufacturing, and service industries. His hands-on experience gives him a unique perspective on the financial challenges business owners face as they scale.
Throughout his career, Michael has served as a CFO, corporate board member, investor, and trusted advisor, helping companies transform financial chaos into sustainable growth. He is passionate about teaching entrepreneurs how to understand their numbers, improve decision-making, and create businesses that generate long-term wealth and freedom. As the author of Powerful Business Strategies and a sought-after speaker, Michael equips business owners with practical financial strategies that increase profitability while preparing their companies for future growth and successful exits.
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