Nic Gibbens is the CEO of Wellington-based mobile apps firm PaperKite, which he founded in March 2010.
Did you pay yourself from the beginning of setting up PaperKite?
I ran the company for the first year or so literally on nothing. I had $20,000 of savings when I started, which I used to pay my mortgage, and I managed to get enough jobs to keep me alive.I worked out of my spare bedroom and was single at the time so I just had myself to worry about and didn't have many costs.
I also managed to get clients to put 30 percent up front, and then I'd split the remaining fee over the duration of each project, which worked really well. I'd come from having a very well paid corporate job to pretty much earning nothing, but I'd never been happier, so I didn't mind.
So when did you start being able to pay yourself a regular amount from your own business?
About 18 months into the business I began paying myself a regular amount of a few hundred dollars a week. Things changed again in March last year, which was our third birthday, when I decided to remove all of our contractors. I'd been whittling them back over time and starting to hire permanent staff, and it was at that stage I moved everyone on to PAYE salaries, including myself.
I realised if our clients were going to take us seriously we needed to take ourselves seriously and bank on the fact we were going to keep growing and make more money. At that point there were five of us who went full time, including myself, on to salaries.
This year has been a non-stop amazing year; we've been busy all the time and everything has grown. So I think this coming year I'm finally actually going to take my salary up to match what it was when I left my corporate job - and hopefully beyond that by the end of the year.
Have there been any hiccups along the way in terms of being able to pay yourself regularly?
I have had points where I've had to put more money into the business and not get paid. We had two major contracts fall over in November last year, for example, which is disastrous for a company of our size because everyone goes away on holiday and no one signs off on any new work again until March. At that time I had to put more money into the business and not pay myself for six weeks so I could pay everyone else for that period.
The people who work for me do so on the belief that I've got their back. They've got their own mortgages, their own aspirations, their own things they need to do and their treaty with me is I'm going to provide them with challenging work and give them money for them coming to sit in my office. I take that very seriously, so if anyone is going to go without it's me and I'm happy for it to be that way because without them I don't have a business.
What advice would you have for others about paying yourself as a business owner?
I think entrepreneurs can often be quite focused on themselves. But the reality is that without everyone who works with you the chain just falls apart, and there isn't a business. So in my mind the people who work for me come first and I'll always take a back seat to that.
