Ep62 Control by Design, Not by Accident: Ownership, Succession & Exit Planning

In Episode 62, I sit down with attorney and founder strategist Scherrie L. Prince — host of the Play Big Faster Podcast — for a candid conversation about what it truly takes to protect a business you’ve worked hard to build.

Scherrie advises entrepreneurs and closely held companies at the intersection of business strategy and estate design, and she makes a compelling case that these two disciplines should never live in separate files. Drawing on her own path — from a Mississippi farm, through a probate dispute over an estate left with no will, a handshake partnership that unraveled, and the 2008 crash — she explains why control in a business must be intentional, not accidental.

Together, we unpack the idea of building a “moat” around your assets: the layered protections — documentation, corporate formalities, insurance, and legal structure — that keep a creditor from “piercing the corporate veil.” Scherrie discusses the coordinated advisory team every founder needs (CPA, attorney, financial advisor, insurance agent, and banker), the spousal consent most owners never consider, the four questions to ask before taking on a partner or investor, and why every founder should reverse-engineer their exit from day one.

It’s a practical, wide-ranging conversation with one reassuring throughline: no decision in business is fatal — as long as you surround yourself with the right people and plan ahead.

About the Guest

Scherrie L. Prince is an attorney who advises entrepreneurs, closely held companies, and founders navigating expansion, partnership changes, and succession. Her work centers on ownership structure, governance clarity, incentive alignment, and exit design. Unlike traditional advisors who separate business planning from estate planning, Scherrie integrates the two — helping owners align their operating agreements, entity structure, and long-term transfer strategy so that control is intentional, not accidental. She is also the host of the Play Big Faster Podcast, where she interviews founders and industry leaders on business, marketing, and the trends shaping long-term growth and leverage.

Connect With Scherrie

• Website
• LinkedIn
• Podcast: Play Big Faster — available everywhere you listen, and video-first on YouTube 

Transcript

SPEAKER_02 0:02

Welcome to Your Financial Maven, where we talk all about understanding your money. I'm so glad you're here. I'm Samantha Mitman-Besnoff, certified public accountant. I've been in the accounting field for over 30 years, and I absolutely love sharing my knowledge all about your financial empowerment. Enjoy the podcast. Welcome to the latest episode of Your Financial Maven. I'm so excited to have everybody here listening. I've got a fabulous guest with me today, Cherie Prince, who is an attorney. You actually work with entrepreneurs, with founders, small business owners on ownership, governance, succession, estate planning. And you work at that intersection where business strategy has to come into play for those things. And you help them with those transitions for any disputes, disabilities, even when they're going to sell their business. And you're also the host of your own podcast, Play Big Faster, which I'm so excited. I listened to a couple episodes and it's fabulous. So to my listeners, you should definitely go check it out. But I'm really gonna have Cherie really talk to us about what she does. So I want to kind of jump right into it. So welcome to your financial maven.

SPEAKER_00 1:19

I am so glad to be here and so looking forward to our conversation. Thank you.

SPEAKER_02 1:23

You are welcome. I'm looking forward to it too. So I'm gonna get started with what is money?

SPEAKER_00 1:27

It depends. If you have it, you may not appreciate it. And if you don't, it may be everything you thought you ever could have wanted.

SPEAKER_02 1:33

I love that. I love that. You're you're right about that, though. I think people who have money, maybe have that wealth, may not appreciate it as much as people that maybe don't have it, or vice versa, right? People who may not have enough money appreciate it because they've got to work a little harder to make it, you know, stretch and things like that. So I love that. I love that. So before we kind of get into really what you do for clients, I want to know your story about how you got started. You know, you're an attorney, but what led you to the business side and helping founders and small business owners kind of through this process of being, you know, making sure they're set up correctly, making sure that they are valuing themselves and their businesses properly.

SPEAKER_00 2:17

So there wasn't just one single thing. Okay. No, I started out as a little girl on a farm, literally in Louisville, Mississippi. Okay. Um, I grew up with my grandparents for a period of time on 150 acres. We had cows, we had pigs, butter beans, watermelon. Oh, I love it. Yeah, I drank out of a water hose. Okay.

SPEAKER_02 2:34

So did well, you know what? I lived in the suburbs of Philadelphia, but I still drank out of the water hose.

SPEAKER_00 2:38

Yes, and that was the best water, was it not?

SPEAKER_02 2:40

Yes, it was. Yes, it was. Okay.

SPEAKER_00 2:44

So started there watching Matt Locke and Perry Mason and still really didn't know that I wanted to be an attorney. Fast forward, my mom passed away at 16. Her parents that I lived with for a period of time passed away in my early 20s. Okay. Did not have a will or a trust. Wow. And, you know, some people just kind of lose their minds when they think that mom and dad's gone. I think I'm I want the lion's share of the estate. Right. Well, every state you live in, if you don't have a will or a trust, the state already has a plan for what happens to those assets. So we had a probate, you know, dispute on who's gonna get what and where is it gonna be. Very ugly. I'm sure it was you know, road bump number one. Yep. Number two, my first business was built on a handshake. Oh business was successful. But one day my partner's wife walked in because he had given her his 50% of the business and failed to tell me. Oh, jeez. And she was like, Well, I'm your new business partner.

SPEAKER_02 3:38

Oh terrible. I'm sorry. That to me, like you have to communicate with each other. Right. Yeah.

SPEAKER_00 3:45

You know, I was like, no, that's gonna be a negative on the 10 and the four. No, we're not doing that.

SPEAKER_02 3:49

Right, right.

SPEAKER_00 3:49

He bummed her too. And then in 08, um, I had a mortgage brokerage and I was a real estate broker. Okay, did not see the crash coming.

SPEAKER_02 3:56

Oh, geez.

SPEAKER_00 3:57

That was the crash. Yeah, I lost everything. So at that point, I have a six-month-old, three and a half year old decide to go to law school. Nice. Because one, I never want to be in a position where I couldn't not take care of my kids. I was a single parent. And two, I should have seen some of this coming. And once I figured it out for myself, I wanted to help other people. So there we are. That we're we're currently in 2026. I just got us caught up. Yeah.

SPEAKER_02 4:24

Yeah. No, I I love that. I mean, I think people have to understand that those real-world experiences can really lead us into areas. And I think you bring up very valuable points about being prepared. I'm also thinking of secession planning and having things in order because I work for myself. I don't have staff, I don't have, you know, that partner. But I think people getting into business don't necessarily think about those things until it's either too late or they listen and hear what you have to say and go, oh, that light bulb goes off. Like I need to get there.

SPEAKER_00 4:56

And even for the ones that do think about it, they don't prioritize it. Very true. It's like, oh, well, I'm young, I'm healthy, I'm married. You know, if something happens in my business, my husband or wife can pick the slack up. Right. No, like these are day one things, really day zero things.

SPEAKER_02 5:11

Absolutely. And I found this since COVID. I have found this since 2020, and people are getting into business, which I think is great. They don't think about these things because either they don't know what they don't know, or like you said, they know they're supposed to do it, but they're working on the product, they're working on their service, they're they're pushing through. And then I'm sure you see it. I get people come to me when their books are a complete mess or their taxes are a complete mess. And then I'm like, okay, let's take a step back. What did you do? And this is what we need to do. I'm sure you see it all the time.

SPEAKER_00 5:43

I do. And, you know, it's it's so interesting that you're CPA because I get questions all the time about strategic advisors. And even the difference between a tax planner, a tax advisor, and a tax preparer, because they just think, oh, she's an accountant, she can do it all. Right. Maybe there are some people that that provide all of those services. Yep. But you're wondering why you have this huge tax bill because you have someone who's just preparing a report of what's happened in the past and you're not planning for the future.

SPEAKER_02 6:12

Correct. And they also think you're a financial planner, too, which I am not. Sure, I can tell you, sure, you can go make investments, but I don't do that side of the finances. And that's a whole nother world in and of itself.

SPEAKER_00 6:23

It is. People think also, because I help you build a mode around your assets and I can set up your legal structures, then I'm supposed to give you tax advice, like, you know, what is this going to do for my taxes? And there are things that I know, but I don't give anyone tax advice. So you have to have those strategic partnerships and people working with you as your village, your business village.

SPEAKER_02 6:44

Absolutely. And I agree with you. I don't give legal advice, but what I can say is, oh, this is a legal structure. Go talk to a lawyer. I do not and will not set up businesses. I will not help them figure out what their structure will be. I'll give them the idea of what are the business structures and what are tax related, what are legal. But then please go talk to a business attorney or a tax attorney or a lawyer that can help you because I am not going to sit there and figure out what is the state gonna do.

SPEAKER_00 7:13

Okay. And so I love that you brought that up because each time I work with someone, I make sure that we identify who their accountant or tax person is up front. And I've gone as far as I don't even get people's EINs anymore.

unknown 7:27

Right.

SPEAKER_02 7:27

You know they can get them for free.

SPEAKER_00 7:29

Well, yeah.

SPEAKER_02 7:32

Right.

SPEAKER_00 7:32

But I want to make sure that people understand that you need a relationship with the person who's gonna be preparing your books.

SPEAKER_02 7:37

Right.

SPEAKER_00 7:38

Anything that has the word tax associated with it, they think that if you do it, you're responsible for it. So any like stuff like that, I just send them straight over to an accountant.

SPEAKER_02 7:46

Yeah, I love it. I love it. I love it. And in fact, that was actually my first question to you. And we kind of let into it about how do you work with businesses and helping them, you know, the rules or the things that you say to them, this is what you need to do to get started. Because there are business structures that are also tax-based. And there is the inevitable LLC that is only a legal structure. And inevitably, when I have someone come to me, like, oh, I set up an LLC, that is great. How do you file your taxes? That is what I ask them next. How do you file your taxes? Because most people with LLCs don't understand that. Or they've created, let's say, an S corporation and don't understand there's got to be potentially payroll involved in that and other legal things that they they talk to their friend in the same business and they told you right, they told them to do this. Please don't do that.

SPEAKER_00 8:39

Don't you love it when somebody just has LLC and they they're they're paying themselves payroll, but they don't have an S election? Right. Oh yeah. So, yeah, like okay, so part of what I do, of course, being an attorney is a license activity. Absolutely and the license is tied to the state that you're giving the advice in. Right. So I coach people all over the world, and I don't do it as an attorney. Okay. I'm a founder strategist. I don't give them legal advice. I'm like the quarterback for your advisory team. I put together a strategy for all your advisors, your CPA, your financial advisor, your tax planner, your insurance agent, your banker. I put together the questions that you need, the relationships that you need, and how they all need to work together to move your business forward without providing legal advice.

SPEAKER_02 9:24

And I actually I'm an independent life insurance agent also. And so I do work and try to tell my clients, let's talk life insurance also, right? It's important. And oh, my husband has it through work. And then I have to explain to them that it's not portable, that if they get fired or they leave, they lose their life insurance. And you have your own business and life insurance is important. So I think that's fabulous that you're giving them the strategies and saying this is what needs to be done.

SPEAKER_00 9:54

So when you talk about it not being portable, same thing with health insurance, right? And I tell entrepreneurs from day one, even if you're an entrepreneur and you may have part-time employment at a college or you may have some other consulting that you do that's considered W-2 income and not contract work, in my opinion, it's so important to carry your own insurance because over time the cost increases. So if you ever, you know, decide to get rid of it and then pick it back up, it may be more. Your your claim status may be different just based on issues you've had medically. And then if you if you do it properly, it's a tax write-off. Who doesn't love tax write-offs?

SPEAKER_02 10:33

Right. I I know, I know. But I think going back to that also is understanding how you structure your business affects that, the financial pieces of it. How you report your financials, whether or not you pay yourself payroll, which if you are a sole proprietor or in a partnership because it is self-employment, there is no payroll.

SPEAKER_00 10:51

Right.

SPEAKER_02 10:52

Like that kind of stuff.

SPEAKER_00 10:54

So I will not even finalize an estate plan until I met with the accountant for my client.

unknown 11:00

Nice.

SPEAKER_00 11:00

And if they just refuse to get an accountant, I have them sign a waiver because I can make the most beautiful estate plan for you and you know, and put together a legal structure to, you know, to protect your assets. But if I don't know what your tax situation is, you know, there's always more than one way to do something. Right. If you tell me that Jane Doe has, you know, 10 years of returns that have not been filed, and she's likely gonna have a huge tax liability, and she may be a licensed real estate agent, but she's married and her partner can qualify as a real estate professional and maybe offset some of these. Like, I don't know what options we have for you. Right. So I always try to talk to whoever their tax person is and say, hey, let's put together something that's gonna serve them holistically. And that's why it's so important to merge your business plan with your estate plan.

SPEAKER_02 11:47

Yeah. Is there any stories you can share or clients that you've dealt with that they came to you so frazzled and and maybe they've already created their business structure, but now they're trying to either unravel it or um fix it. What are the things that you do to help them, you know, take that deep breath and then kind of help them move forward? Samantha, how much time do you have? I think we have an hour and a half, so I'm just kidding.

SPEAKER_00 12:13

A series, okay?

SPEAKER_02 12:14

Yeah, yeah. We we could, we could tell me this story. Yeah, I agree. I agree. Uh-huh. Yeah.

SPEAKER_00 12:21

So one story that comes to mind is a family business. You have the mom who's like the matriarch, and they've had a gas station for years. Wow. She's been the face of the gas station, she's the primary person that works there in a very small town. She does all the banking. Well, her name is on everything, no one else's name. Mom gets sick and passes away. Now, at the gas station, they take benefits from you know different government subsidized entities. Well, now that mom has passed away, they don't have access to the checking accounts. And like, even though the people know them at the bank, their name is not on anything. They've never had meetings. So you have a company with multiple partners, which are family members, you don't have any meetings, there's no operating agreement. We had to basically go in, have a meeting, take a vote, produce minutes, do resolutions, and get all that stuff cleared up.

SPEAKER_03 13:14

Yeah.

SPEAKER_00 13:14

Um, and then put together a succession plan so that if someone else passed away or became incapacitated, the business would not stop.

SPEAKER_02 13:22

Right, right. And and it's a very important part because, like, like I said, I'm a solopreneur, but I've given my husband access to everything. And I'm in the process of getting him added to my bank accounts for the business, which if you're doing a business, please make sure you have a separate business bank account. That's another thing that I come across because I want to make sure if something does happen to me, he has access. Exactly. And legal access too, right? It's not just here, it's can he have access to getting those accounts squared away, what needs to be done, et cetera.

SPEAKER_00 13:55

Here's a phrase that some business owners may know, but I hope you would never have to personally get to know this phrase. Piercing the corporate veil. That's where someone has filed a claim against you, you are possibly in litigation, and they're trying to reach into your personal pockets. Right. You're saying that your business is not a business, it's just a hobby. And whatever relief they get against you in court, they should also be able to go into your personal bank accounts, not just your business, but your personal. And how does that happen? It happens from a lack of documentation, a lack of observing formalities. Right. And you never want to become personally acquainted with Pierce and the corporate veil.

SPEAKER_02 14:33

No, you do not. You do not. No, you do not. And and I think that that, you know, yes, you, you know, businesses should make sure they have liability insurance. And like I have professional liability assurance, and then I have business insurance because I'm working out of my home and I want to make sure that something I don't have clients come to my home, but if something were to happen, like if a client had to drop some stuff off, I still have their documents. Now I keep them in a very secure safe because I don't want anybody else rifling through the paperwork, but I also have it so it's protected. Because if something were to happen, like I mentioned to you before we really started, I live in South Central Pennsylvania in Lancaster PA, and we just had horrible storms run through. And half of where I live, the power is just coming back on for people. The trees are still blocking roadways. It has been a nightmare. And several homes have been condemned. So now if you have a business in that home, it's condemned. You can't necessarily get that stuff out. So I think it's important to understand those things and how to protect yourself.

SPEAKER_00 15:33

It definitely is. And you know, we talked a little bit about life insurance and health insurance. Yeah. But I love a good umbrella plan.

SPEAKER_02 15:41

Yeah.

SPEAKER_00 15:42

If you don't know what to get, grab an umbrella plan until you figure it out. Especially if you're a solopreneur and so much of what you do is interconnected.

SPEAKER_02 15:50

Yeah.

SPEAKER_00 15:50

Or, you know, depending on if you have a public-facing business, maybe you work from home, maybe it's virtual. You just need a way to cover certain risk. Yeah. Now, just because you have insurance does not mean that you're fully insulated. You still need those legal protections. You need to follow formalities. There are so many different layers, and that is your moat. Um, you know, if you've seen anything that I've done, I'm always talking about build a moat, build a moat, build a moat first. Well, that is part of your moat. Insurance is not 100%. You have to do those other things as well.

SPEAKER_02 16:21

Right. And like you said, and and you say you work in conjunction with everybody because it's important. And I think, you know, I have a lot of small business clients that have come to me or people that I've talked to that, oh, I don't need an accountant right now. I, you know, I don't need to talk to that lawyer. I've got my financial planner. Well, that's great. But what if you have something legal happen? What if, you know, do you know there are changes? There are things that have to be reported to the state of Pennsylvania. Do you know sales tax? Sales tax is to me one of the biggest issues, I think, for any business owner. And especially now that there's Nexus where you can be selling things all over the United States. You should be still collecting sales tax, but now do you have to remit and pay that to other states in addition to the state that you're in? Um, I had a client uh several years ago, she was collecting sales tax. She also had a part-time W-2 job. She had her own business. She was collecting sales tax, but never remitted it because she thought her W-2 taxes were part of the sales tax. So when she hired me, I got her all cleared away and I said, listen, there's still going to be some penalties and some interest, but you can talk to the state and explain the situation. You still collected it, you can show that you collected it. And some of the interest and penalties were abated, were refunded. But she had three years worth of sales tax she had to pay. And she did it, she filed everything, she did it. But it's those things, not having those people in place to help them with that.

SPEAKER_00 17:46

Yeah. And that's something like when we talk about risk and insulating yourself, that is an internal risk. That's not someone from the outside suing you. That's not somebody walking into your business and tripping and slipping and falling. That is something that you have created that can put your entire business in jeopardy.

SPEAKER_02 18:04

Yeah, it certainly can. It certainly can. And and from your perspective, you know, you're seeing the legal side of it. Are there things that business owners just completely maybe just don't know anything about that you say to them, hey, have you thought of this? Or make sure you're doing this as you're creating and building your business? Because at some point, businesses are either going to continue, they're going to get investors involved, they might sell, they might walk away. So again, besides protecting themselves, are there anything else that you see or that you, you know, recommend that they look into or do?

SPEAKER_00 18:39

The number one thing that I see founders overlooking is a spousal consent. Okay.

unknown 18:46

Okay.

SPEAKER_00 18:47

Sharia was a spousal consent.

SPEAKER_02 18:48

Right. Just gonna say, what is that?

SPEAKER_00 18:50

Yeah, basically, it is like a prenup between your spouse and your business. Okay. You are giving them full access to the business plan, the books, the pro forma, everything that the business is going to be when you before you start the business. They are waiving certain rights in favor of shareholders, investors, your partner. And you are determining when you first get in the business whether or not, you know, the spouse or you know, your state is gonna have first right of refusal to your interest in the business, management decisions and things like that. Because honestly, if you had a partner, something happened to you, they may not want to be in business with your spouse. Right. Right. You know, we're gonna make sure that your spouse gets what it's equitably yours in terms of the value of your interest, but they may not want to be in management with your spouse. And so a spouse of consent is something that they do not think about. Also, what does a divorce look like?

SPEAKER_02 19:48

Yeah. Very true, right? Yeah.

SPEAKER_00 19:51

So, you know, you're getting a divorce. Does that mean that your wife may get 15% of our business because you didn't plan for that, or maybe it's not in our operating agreement, our partnership agreement?

SPEAKER_02 20:02

Right. That's that's a very valid point. I have worked with clients who who weren't in business for themselves, but were still going through some really nasty divorces. And that thought process of if they had a business, then what? Right. And if they don't have that, so I would have never even thought that, oh, maybe you need to add that too, you know. And I guess would that go for if you are single, you don't have a partner or spouse, but like there's a family member that might want to get involved. Like, you know, having that person be your backup, but then protecting the business as well.

SPEAKER_00 20:36

Okay, that is a perfect example. I'm gonna have to add it to my future podcast.

SPEAKER_02 20:40

Yeah.

SPEAKER_00 20:42

Like, that is why you have to merge your estate plan with your business plan. Because if you are a single person, no kids, and you have a business, okay, you may have employees. Can the business survive without you, or is it gonna come to a halt because your estate, which has value, is in probate? So you need to have either a will or a trust set up so that a trustee or a third-party receiver can keep the operations going. What if Sam Walton did not go public and did not have a will or a trust? Would Walmart still be standing, or would they have to close the doors until all of his kids were fighting it out in probate court?

SPEAKER_02 21:18

Right. That's a good point. And now, of course, I'm going, oh my goodness, I've got to write these things down for myself because I think these are some things I may be contacting you after this because there are things that, you know, yes, as an accountant, a CPA, I know certain things, but I don't know everything. And I've been doing this for 13 years almost. So, you know, when I started out, it was that that side business. It was being flexible home with the kids so that I could be there for them. But in the last, you know, six years, I'm like, oh, this is really going somewhere. So it's a good point. I'm I'm gonna have to contact you after this is over.

SPEAKER_00 21:49

Well, and you know what? The good news is, and I tell founders all the time, you don't have to know at all. You just have to know who to call.

SPEAKER_02 21:55

Right. This is true.

SPEAKER_00 21:57

Yeah. If if your books are a mess, call Samantha. That's No, if your doc if your legal documentation is a mess, call Cherie. Right. Or you know. So you just need to know who to call.

SPEAKER_02 22:07

Right. You're right. And and it's interesting because the accounting field in general is shifting to more advisory service work. You know, AI is coming in and doing things, which I'm not not, I am a fan of AI to a degree, using it to help me with things, but not using it to take over what I do. But it's shifting to more advisory and in this capacity of, I can do the work, but can I help you understand what you're planning for, what your phases are for? You could be just starting out in business or you could be in business for 13, 14 years. Sometimes you need to take that step back and reevaluate where you're at. And I'm sure you run into that a lot as well on the, you know, the legal side or the planning side of things.

SPEAKER_00 22:50

Definitely. And here's the thing about AI AI is a tool. It is. We use it at our firm and in our consulting practice for speed, right? For instance, we have a huge part of our practice that does just transactional stuff. So we're not typing legal descriptions anymore. Right. We're feeding those into AI. They're, you know, they're, they typed them, we proof them, and it saves us so much time. There are certain form documents that we produce all the time, like releases, cancellations of deeds and things like that. We're not typing those things. We are mass producing those. So you really just need to know where it's appropriate to have AI. And you also need to understand that all of these different language models are different. So, and some of them are like echo chambers. You put one thing in and then you disagree. Oh, yeah, you're right. Right.

SPEAKER_02 23:40

And I think it's interesting because we've been talking about this in the CPA world, is, and we say this, and I'm sure you agree, do not put your financial or legal information into AI. You can ask general questions, but don't feed it everything. And I think part of that issue is I did not see it during tax season, but several CPAs that I'm connected with, clients put their stuff all into AI and it spit out their tax return and said, you get a refund. And they took it to the accountant and the and they said, we're getting a refund. So here you just fill it out and give me my refund. And then it turns out it's either less than what AI said or they owe. And it's because people don't know necessarily the questions to ask and continue to ask. And I think not just with AI, I think in general with business, you don't know what you don't know, but you have people there to ask. And I think that's important too.

SPEAKER_00 24:32

And when you talk about the shift and your services becoming more advisory, so okay, AI said you get a refund this year. But if you were actually talking to a real person, you could have reminded them, well, don't you have this expense plan or don't you have a kid going to college? Right. Don't you have, you know, a note maturing or certain lumps, you know, these are things we need to consider down the road. So let's plan for these now. And maybe let's not take the refund now, let's apply it to another year. Right.

SPEAKER_02 25:01

Right. 100%. And I think in general, not just personal, but for businesses, we need to be more aware of that. And it's okay to ask for help. It's okay to go to that attorney or the CPA and ask those questions because you need that expert advice. And sometimes you might know it, but you still need to that sounding board. And I'm not saying it's not okay to talk to your friends or your people in your network group that's part of the similar like business that you're in, but you also don't know what their CPA said or did they talk to a professional. So I think that's important too when setting up a business and running a business.

SPEAKER_00 25:39

And also the thing about AI, it only knows what it knows. So its knowledge base may be limited to a certain period of time. In Mississippi, we have a lot of changeover of laws on July 1st every year. So we always have these updates. So today, you know, we're recording this, it's the beginning of July. We just had a lot of new laws go into effect a week ago. So you're talking to AI and their knowledge base is through two years ago. Now they're three years behind because we've just had another law update.

SPEAKER_02 26:09

Right. And I'm sure, as in with tax work, what the federal law might have been passed does not mean the states agree or will do what the federal government is doing at their level. There could be a credit, let's say, for a tax return on the federal side, PA is not necessarily going to give it to you. Or your state might give you some relief that the federal government isn't going to give you relief for. So that's important to be aware of as well.

SPEAKER_00 26:35

There's nothing like a live person. Exactly. And who wouldn't want to call and just talk to you and just you know?

SPEAKER_02 26:41

They're not scary. I'm I'm telling you, I'm not scary. Sheree's not scary, but like if you have to call the state or call the federal government, I know it can be frustrating, but they're not scary, I promise. They really aren't.

SPEAKER_00 26:53

Well, and you know what? They're they're people. Yes. They're people. And if you're calling, you know, it's likely that you want to cooperate. You want to do the things that are going to put you in good standing. And so they will help you. Oh, yeah. The problem comes in is when they're calling you and dropping by your house and you're not responding. That's true.

SPEAKER_02 27:11

Although the IRS does not stop by unless it is so far gone, right? Like it's always going to be a notice. Although they're trying to shift things to more online onto their website. There, you can create accounts to see your stuff on the IRS website, but they're not going to call you. They're not going to text you. And I think that's something important too, is scamming and phishing. What are the things that you see, or how do you help your clients understand? Like to take that breather before they click on something or answer, you know, they answer that phone call and give information. How do you help them kind of navigate that? Because there can be legal issues with that as well.

unknown 27:45

Yes.

SPEAKER_00 27:46

And, you know, part of what I teach is information security and backups. Because, you know, we do store some things at our office, but we do not keep any originals. So when you leave, you're leaving with your originals. We do scanning documents. We have a document retention system that, you know, we say we keep it for X number of years, but we keep it way beyond that.

SPEAKER_02 28:06

I was going to say same here.

SPEAKER_00 28:08

Yeah, way beyond that. I just don't need you calling me in 20 years. Where's that one-page contract you did 20 years ago? Like, I yeah.

SPEAKER_02 28:15

Yeah, that I'm not going to find.

SPEAKER_00 28:17

But um, no, document security, passwords, like, you know, biometric use of passwords and stuff. Because here's the thing: you may have an assistant who has access to certain information, who may have check writing privileges, who may be a signatory on an account. What happens if they embezzle money? What happens if they make an error? That's an honest error, but you did it out of an account, out of a restricted account. Right. All of that stuff, you know, puts the business at risk.

SPEAKER_02 28:46

100%. And I tell my businesses that I work with and then the workshops I do, people I talk to in networking. It's great if you have an internal, let's say, bookkeeper or someone in human resources, you know, they're doing that, but you have to still monitor that. You still have to check in. You can't just say they know what they're doing and leave it, because you just don't know. Could that person be embezzling? Could that person have made a mistake and it was an honest mistake, but now it's messed up this account or this part of the business? And could it pierce the corporate veil? Could it cause an issue that if liability or they get sued or something happens, now what? I think that's important too for small businesses. Yeah.

SPEAKER_00 29:26

I have one client, they provide medical services. And they had someone in-house who was doing their medical billing and just honestly, as far as we can tell, did not understand how to do the billing. And so now they have a multi-million dollar Medicaid clawback. Wow. Wow. And Medicaid. Medicaid is going to get its money. Oh, yeah. Oh, definitely.

SPEAKER_02 29:50

They will get it.

SPEAKER_00 29:51

Yeah, they're going to get it. But the fact that how do you prepare for something like that? Right. And so those are the types of like the check-ins that you have to have, the standard operating procedures, the look back on things, the training.

unknown 30:05

Right.

SPEAKER_00 30:06

It's all part of your moat.

SPEAKER_02 30:07

Yeah. So as part of that, you talk about there are four questions that every small business owner really needs to ask, really, when it comes to bringing on that partner or that investor, when it comes to financing the business potentially. So what are the things that you tell business owners they really need to ask before they get involved in something like this?

SPEAKER_00 30:28

The main question is: are you making a long-term decision to a short-term problem? So maybe the issue is that you are cash-strapped. So the answer is not taking on a partner because you don't have money. It may be getting a line of credit. It may be taking on an investor who does not take on management, but you know, provides you with funds for a certain period of time. Because what happens when you take that partner? And so this is a long-term relationship now. It's like a marriage. Right, right. What does it look like outside of that 90 days that you really needed the money and now day 120, that partner's still there, and you don't really respect that person. You just needed them for that period of time. You know, is this something that an employee can do versus a partner? Some people take on partners because, of course, they can't afford an employee. So they figure, well, this person can do the job, but I don't have to pay them. They're not well suited for management and for ownership.

SPEAKER_02 31:23

Right. But they still get a part of the money as ownership. And I think that's right, they don't get paid wages, right? But they still get a distribution potentially. They still have to, you know, file their tax return and take part of that profit if the business has profit as self-employment. So it it is, it's a very valid point.

SPEAKER_00 31:43

Yeah. Another question is am I moving this company in a direction that is morally aligned with my vision and values? Oh, I love that. I love that. Because even as you take on employees, partners, and investors, if they are not morally aligned, then that's a problem. And then the fourth question that you have to always consider is how is this going to affect the continuity of this business? Because if you have employees andor investors or partners, everything that you do personally goes right back to that company. If I get a divorce, if I found personal bankruptcy, if somebody sues me individually, what am I out here doing in the marketplace that, you know, when Samantha comes to work, does she have to worry about is she going to have a job? Because I just got a DUI and kill somebody. Right. And so now they're taking all my stuff, including the shares of my company.

unknown 32:35

Right.

SPEAKER_02 32:35

And it's hard because now social media comes into play there because we have keyboard warriors who now, don't get me wrong, I have responded to some people like, what? Like, you know, but but I do try to keep it civil. And I think that's what we're lacking, the civility of things, because you can hide behind that keyboard. And I don't think people realize you can still get caught. Right? Someone's going to recognize you and say something, and that could affect your business. It could affect the employees. And I think we have to be more cognizant and aware of these things and try to not necessarily hide behind the keyboard. If you feel a certain way, that's fine. But you you have to know there are consequences to that.

SPEAKER_00 33:20

We definitely have a council culture. Yeah. And now, with there being access to so many of the same types of services. Like if someone does not desire for me to be their attorney, there are attorneys everywhere. They have legal Zoom, they have all these other alternatives. And a lot of people are using AI for the, you know, for legal stuff.

SPEAKER_02 33:41

They are. And they, but again, they still need to talk to a person because it's just like with accounting and and and legal, it's fine to ask the questions into that chat GPT or Claude or whatever AI you're using, but you still got to check.

SPEAKER_00 33:57

You have to check. Yeah. But, you know, as people that provide a public service and are public facing, we have to just be so careful because there are other people providing the exact same service. And so what makes us different? Right.

SPEAKER_02 34:10

Right. And I think that's important too, as these businesses maybe are taking on an investor or wanting to get finance is, you know, what are we projecting? And like you mentioned, the ethics, the morals, if it's not in alignment to what they want to project, you know, maybe it's not the right way to go. And maybe that's where they need to take that step back, talking to an attorney, talking to someone like you, Cherie, that does this to help them kind of go, oh, I didn't even think about that. It's quite interesting. Um, so I'm sure, you know, part of my thing is financial empowerment. And I know that you talk to businesses about building that financial independence. And what are some things that you've talked to your businesses about to help them get there? Because one of the things I say constantly is revenue does not equal profit. And I understand a lot of people don't understand that. And and rightfully so, because they look at a financial statement and they see the revenue and the expenses, and then, oh, I have a profit or sometimes a loss, maybe in that month or that year. But how do you help them understand that financial independence and get beyond that and realize, you know, what do I need to succeed besides just bringing in the money?

SPEAKER_00 35:24

So a lot of it, and I try, oh, I try so hard not to use the word money. Okay. I try not to use the word wealth, finance, financial, tax. And I do that because so much of what I do, even though I'm an attorney and I provide legal access, resources, and I'm the quarterback for your advisory team, a lot of it's mindset. Yeah, very true. Can I be a millionaire if I don't believe that? And what sort of beliefs do I need to get to that next level to build that mode around my assets? So, in order for me to have financial independence without telling you, go have financial independence, um, we talk about reserves. We talk about limiting liability, we talk about reducing risk, we put together systems to do that. What does that look like? That may look like a series of disregarded entities, a C Corp, an S Corp, depending on what your, you know, what your goals are. Um, your partner may not be a part of your business, but what does their situation look like? Do you file joint returns? Are you business partners? What are your other partners doing? So much of what I do is about reducing risk and putting layers on things. One thing that I do, I share with different founders, we talk about equity stripping. Oh, interesting. Yeah. So, you know, if you look like a fat cat that I can just go sue because you have all this cash in the bank, I know you're flush with insurance, and you have all these assets, you are a likely target.

SPEAKER_02 36:52

Probably.

SPEAKER_00 36:53

Yeah. Yeah. What can I do on paper, ethically and legally, to help you look like, you know, there's nothing in the well. The well is dry while preserving those assets so you can be financially free. Interesting. Interesting.

SPEAKER_02 37:10

That and that equity stripping, that's very interesting to talk about how, like you said, doing it legally, doing it in the right manner, but it's a way to protect you, like you keep saying, building that moat around your business. And I think it's important. And I think that, you know, we're not here to try to scare away people who want to start businesses or who are in businesses and are like, oh my gosh, what am I doing? We're trying to provide this information because it's so important. And to say to business owners, if you're in a position where you're going, oh my goodness, I hadn't thought about, you know, working with these three different kinds of advisors and doing these liabilities and doing the quote unquote prenup with the partner or working with it, the estate planning, it's not too late. Like you can still go out and do that.

SPEAKER_00 37:52

And here's the thing: even after you do it the first time, you still need to do a checkup. 100%. Minimally once a year. I tell folks to have your advisors, you know, jump on a Zoom once a quarter.

unknown 38:04

Right.

SPEAKER_00 38:04

It may be 30 minutes because think about it, getting four or five different professionals in the same room. It's very hard.

SPEAKER_01 38:09

Right.

SPEAKER_00 38:10

So it's like the first time may be difficult, but then it's like, hey, this is a recurring appointment. Every three months on the last Friday at noon, you know, bring your lunch, eat while we're on Zoom. Let's talk about business.

SPEAKER_02 38:22

Yeah. And I try really hard on a monthly basis, but maybe I need to switch it to quarterly, getting my clients that I do work with to talk with me. Just sit down for 30 minutes. Let's see where things are. And it's very hard to try to get them to do that because they're so busy. And I'm like, I get that. But if we don't review this stuff, even at a monthly or quarterly or annual basis, we're not going to be able to plan to make sure your tax return is correct or to make sure if you're going to go get financing or talking to an investor, that you're in a good place. So I do think that's a very valuable point. Uh, are there any other insights or tips? I mean, this has been so wonderful. Like I've just been enjoying this conversation, but anything maybe we haven't touched that you think my listeners should understand and know.

SPEAKER_00 39:07

Well, actually, one thing that you just said about how important this is for financing.

SPEAKER_02 39:11

Yeah.

SPEAKER_00 39:11

Because you may have a great business, you're turning money over hand and fist, making deposits every month. Yeah. But you're not having meetings. You don't have resolutions. You have not done the things to keep a creditor from piercing the corporate veil. Those same documents help you when you need a line of credit, when you need financing. And even as you're planning an exit, um, Stephen Covey, begin with the end in mind. Okay. Every single time I talk to someone who's very early in the journey, we talk about reverse engineering their exit. Interesting. And an exit is not just selling your business. Maybe it is you passing it to the next generation. It could be a bankruptcy reorganization, right? It could be a merger where you just maybe stay on for a couple of years and then you phase out. So, what does your exit look like? And that's one thing that I think that we don't talk enough about. It's kind of like the insurance conversation. Yeah, I agree. If I talk about insurance, I'm gonna die. Well, guess what? You're gonna die anyway. So let's talk.

SPEAKER_02 40:09

Right. Like we, it's not a great subject to talk about, but you have to protect yourself, whomever your family is involved in it, the business that's involved in it. You know, and I know businesses that have just walked away. My in-laws walked away from their business years ago, but they were also a C corporation, which they really shouldn't have been. So it just the accountant that they worked with for many, many years, they just they worked with him because he was just somebody they trusted, but he wasn't good at planning. Now, I understand in that time frame, accountants not necessarily CPAs, not necessarily did that, but yeah, they they walked away from the business and I just cringed because they lost so much. And they they were fine. I mean, they they they're okay, they're they're great, but like they just took a hit when they walked away from the business without a plan. And it's hard because you don't know, you know, should I talk to somebody, should I try to sell it? I mean, it it was it was hard to see that.

SPEAKER_00 41:11

Well, and and here's the thing even with planning an exit, you don't do it a month before you stop operating. It may take years to get your books together to get the value because in your mind, I have a multi, you know, million-dollar business, but on paper is valued at $100,000. Right, right. You know, I had one client passed away. He owned his own HVAC company. Well, he was the business. Right. He did not even have an LLC, he was a sole proprietor. And his wife thought she had all this money from a business. And I like, no ma'am. No, no.

SPEAKER_02 41:45

I mean, that is something I am an LLC. I I say I'm a solopreneur, I work for myself, I have no staff, but I am an LLC. Partly was pushed into it with the podcast. Um, how I started with the podcast was you really should be an LLC. And I did my research, and you know what? I feel better that I did. I feel protected. But at this point for me, I'm gonna stay where I'm at. But I do have a lot of businesses and clients that then take it to the next level, again, without maybe knowing, now you got to review everything. Does it make sense to become a partner and S corporation? You know, what is what is that planning? Because, like you said, if you planned your exit strategy as reverse exit strategy, and now you're changing it, you got to go back and replan that.

SPEAKER_00 42:27

Well, and and here's uh a hack for you. Say, for instance, you started a company, you started out as a corporation, and maybe that's not what you need it to be. You don't have to live there forever. Right. You can strategically phase that out. You can do an asset purchase of the assets from that company to the new company. I mean, there are just so many ways that you can get on track. So no decision in business is fatal. Right. Right. You can always make a pivot.

SPEAKER_02 42:55

100%. And I think that that is important. And I think it's important to have the people in place to help you make that pivot. You know, that attorney, that financial advisor, the CPA, you know, whomever else might be able to help you with that. You know, and I do get the, especially with the ones starting out, but I don't have the money yet to do that. I understand that. But these are things you have to plan for, and maybe you have to take that leap of faith and have that all in order before you get started.

SPEAKER_00 43:21

And you almost can't afford not to do it. Right. Because by the time Yeah, by the time you figure it out and you've made a mistake, you know how expensive that's going to be to hire an attorney for litigation versus planning.

SPEAKER_02 43:32

Yep. I listen, I get it. And, you know, and I and the clients, some of my clients over the years that have had some tax issues and, you know, the IRS has sent them stuff. I'm like, all right, let's take a breath, let's figure this out, let's let's contact them, let's, let's explain what's going on. We can work through these steps together. And then they're like, oh, but nobody told them. No, or they just didn't understand when people were telling them why it's important to have those people in place.

SPEAKER_00 44:00

And the one great thing about working with someone like you is that, you know, nobody knows who's going to actually get audited. But if you do get audited, you have someone who understands your books and they have a defensible plan, like, okay, this is why we took this deduction. Right. Here's the paperwork that supports why we thought, you know, this was categorized like this versus this. Right.

SPEAKER_02 44:23

And I do. And it's an important point. I always tell my clients if you can support and defend the position of why you took that expense and have the support for it, most likely nine times out of 10, it'll be fine. But you have to be able to defend that position.

SPEAKER_00 44:40

Right. We don't need to be looking for receipts from three years ago. Right. That is not a good place to be in. Right, right. You know, I love the fact that now you have so many CRMs and just other programs and accounting programs that encourage you to upload receipts as you make journal entries.

SPEAKER_02 44:56

Attach it to attach it to the transaction. And I try to do that as much as possible with my clients, but I don't always either get the receipt. But I do have a client portal that's very secure. And I always tell them, please, any financial questions, do not email me. Put it in the chat in the portal that's in your in your portal that is secure. Put upload the documents there. Do not text them to me. Do not send them via email because I can't guarantee the safety of that. And now you have a place that is available to you while you're still my client. And then I, you know, if I have to let go of a client or they let go of me, you have so many days to download your, you know, I give them a couple months, take all your stuff that you need. I archive it. I still keep everything, like you said, you do too, but I don't give them access if they're no longer my client after a certain period of time. You know, and and I've had unfortunately clients reach out to me. I'm like, well, I can open up your portal, but it's archived and it's gonna cost you a little bit because I've got to, you know, it's it's time, it's it's trying to get it all restored for you. But oh, I didn't download it three years ago. I have it, but sorry. It makes a difference, yes. It does make a difference. So anything else maybe that you thought about while we're chatting that you'd love to share uh before we uh finish up on the podcast?

SPEAKER_00 46:13

Really? And I I know this is gonna sound so cliche, but play big faster with your business decisions. Don't be afraid to play big faster. Yeah, um because nothing is fatal. No, you know, don't be afraid of making a mistake. Make the mistake, learn from the mistake. That's right. Hire competent people to be around you and to help you navigate those things.

SPEAKER_02 46:33

Yeah, I love it. I love it. Sheree, this has been fabulous. Where can we find you?

SPEAKER_00 46:37

Okay, the best place that I hang out is LinkedIn. Okay. I try to provide content that helps folks. If you're just in the area, you want to talk, have questions, or just get some advice about some things as Cherie speaks.

SPEAKER_02 46:50

All right, and I will have all those links in the podcast notes. So when anybody comes to listen, they'll see that. Also make sure that you go to listen to Cherie's podcast, play big faster. Um, I'm assuming we can find that anywhere pretty much, or are you on certain on certain uh platforms?

SPEAKER_00 47:07

Well, no, we're everywhere that you listen to podcasts and we are a video first production. So I love for you to come to YouTube and see all the great founders that stop by and you know share those nuggets with us.

SPEAKER_02 47:18

I love it. Thank you, Cherie, so much for joining me on your financial Maven.

SPEAKER_00 47:22

Thank you for having me.

SPEAKER_01 47:30

Follow, like, and subscribe to your financial maven wherever you listen to your podcasts. And make sure that you leave your money stories or questions for me at www.yourfinancialmavenpodcast.com. I cannot wait to hear what you have to say about money. The purpose of this podcast is to provide general information on the subjects discussed. It is for educational, informational, and entertainment purposes only. It is not meant to resolve your specific financial needs or situations. Please consult with your CPA, tax, or financial professionals.

SPEAKER_02 48:11

Your financial Maven is hosted and produced by Samantha M. Besnov CPA and your Financial Maven LLC. Editing is done by Chris Zarnock of KMZen Creative. Music is written, composed, and performed by Daniel Shore.