Synopses & Reviews
Although many people are taking the entrepreneurial route in todays market, very few understand the inherent responsibilities and intricacies of opening their own businesses. Entrepreneurs who are experts in their fields are still struggling to survive due to the complexity of legal, tax, and other financial issues that come with starting a new business. This comprehensive guide focuses on the financial issues that matter most to entrepreneurs and their advisors.
This book gives you the knowledge and insight on how best to advise your entrepreneurial clients through every stage of their journey. From the pre-start analysis to the initial public offering of a business, the role of financial advisor is clearly defined throughout each chapter. In breaking down the key elements of starting a new business, Advising Entrepreneurs will teach you how to advise your entrepreneurial clients on:
The easiest and cheapest way to start a business
How to deal with venture capitalists and locate other sources of financing
Ways to measure different tax treatments
Risk management and shielding assets
Compensation for the entrepreneur and employees
Marc Lane, an active attorney and expert financial planner, analyzes the profits and pitfalls of starting a business. Strategies for receiving start-up capital, protecting assets, lowering taxes, managing capital events, and much more are all outlined in detail. Learn how entrepreneurs can stand apart from their peers by offering specific compensation packages to management and employees. Protect your clients interests by making sure they remain with their company should they decide to sell it. These topics and many more are all discussed so that you, the financial advisor, may advise entrepreneurial clients on what is best for them and their new business venture.
Financial advisors and entrepreneurs alike will find this volume an indispensable source of reliable and up-to-date information.
Review
"The entrepreneur is faced with decisions throughout the life of the company that have significant repercussions on the enterprise as well as on personal financial exposure. Addressed to financial advisers, Advising Entrepreneurs discusses the financial implications and pros and cons of decisions from the start of the business plan, through the formation of an entity, financing, operations, and eventual harvest of the company. The book maintains a useful middle ground between the superficial and the highly technical. Financial advisers will come away with an increased appreciation of entrepreneurial behavior, while entrepreneurs will be able to better manage the risks and financial assets of their businesses." (HBS Working Knowledge, Pub. Date: Oct 1, 2001)
Synopsis
"The successful entrepreneur must confront and overcome legal, financial, and business obstacles. Marc J. Lane has done a wonderful job of addressing all of these in one very readable and sensible book."Thomas Morsch, Director, Small Business Opportunity Center, Northwestern University School of Law
Advising Entrepreneurs helps you address the special needs of your entrepreneurial clients. With the growing interest in starting small businesses, entrepreneurs are looking for expert advice and guidance to help them overcome the legal, tax, and financial challenges they face.
This book outlines solutions and ideas that you can use to steer your entrepreneurial clients through the rough waters of starting a new business. From getting a business on its feet to preparing for an IPO, you will learn the different strategies and options available to your clients.
The role of a financial advisor has expanded in scope and importance with the growth of new businesses. Take this opportunity to broaden your financial planning skills and learn how to advise your entrepreneurial clients in the best way possible.
Synopsis
This valuable book helps financial advisors address the needs of their entrepreneurial clients. Most people opening their own businesses are experts in their fields. But when it comes to the vital intricacies of running a successful business, many entrepreneurs find themselves struggling to survive.With more and more people starting their own small businesses, a growing need has developed for expert guidance to help today's entrepreneurs face their new legal, tax, and financial challenges. Advising Entrepreneurs helps financial advisors address the special needs of their entrepreneurial clients. It provides a comprehensive approach to growing wealth, shielding business assets from liabilities, lowering taxes, and much more by promoting prudent risk-taking.
Marc Lane (Chicago, IL) is a business and tax attorney. He is a Master Registered Financial Planner, Registered Financial Consultant, and Certified Investment Specialist. He has authored thirty books, is an Adjunct Professor of Business at the University of Illinois College of Business Administration's Institute for Entrepreneurial Studies, and an Adjunct Professor of Law at Northwestern University.
About the Author
Marc J. Lane is a practicing business and tax attorney in Chicago. He is a Master Registered Financial Planner, Registered Financial Consultant, and Certified Investment Specialist. He has authored thirty books and is an Adjunct Professor of Business at the University of Illinois College of Business Administration's Institute for Entrepreneurial Studies and an Adjunct Professor of Law at Northwestern University Law School.
Table of Contents
Preface.
Part One: The Financial Advisor's Role.
CHAPTER 1: The Regulatory and Ethical Environment.
Duties of a Fiduciary.
Initial Interview.
Compensation Approaches.
Engagement Letter.
Conflicts of Interest.
CHAPTER 2: Financial Management and Planning.
Pre-Start Analysis.
Entrepreneur as Manager.
Evaluating the Enterprise.
Eventual Harvest.
Part Two: Shaping the Venture's Financial Structure.
CHAPTER 3: Using the Tools of the Accountant.
Break-Even Analysis.
Forecasting Models.
Analyzing Financial Statements.
Managing Cash.
Managing Receivables.
Managing Inventory.
Managing Liabilities.
Managing Capital Assets.
CHAPTER 4: Entity Design Choices.
Tax Considerations.
Sole Proprietorship.
Partnership.
Corporation.
Limited Liability Company.
CHAPTER 5: Private Placements.
Federal Exemptions.
Private Placement Memorandum.
CHAPTER 6 Venture Capital.
Venture Capital Marketplace.
Business Plan.
The Venture Capitalist's Valuation Process.
Venture Capital Agreement.
Employment Agreement.
Shareholders' Agreement.
CHAPTER 7: Bank Loans and Debt Alternatives.
Characteristics of Debt.
Sources of Debt Financing.
Creditworthiness.
Types of Loans.
Leasing.
Working Capital Funding.
Selecting a Banker.
Negotiating a Bank Loan.
CHAPTER 8: Government Funding.
Federal, State, and Local Funding Sources.
Small Business Administration.
Other Federal Opportunities.
CHAPTER 9: Joint Ventures and Strategic Alliances.
Alliance Strategies.
Licensing.
Identifying a Strategic Partner.
Working toward a Strategic Alliance Agreement.
Part Three Protecting the Entrepreneur and His or Her Assets.
CHAPTER 10: Risk Management.
Organizational and Operational Considerations.
Developing a Risk Management Agenda.
Insurance Principles.
Insurance Strategy.
Property Insurance.
Liability Insurance.
Insurance Benefits for Employees.
Self-Insurance.
Director and Officer Liability.
Indemnity.
CHAPTER 11: Valuing the Entrepreneurial Venture.
Evaluation Methods.
Valuing Assets.
Valuing Liabilities.
Determining the Purchase Price.
CHAPTER 12: Buy-Sell Designs.
Buy-Sell Agreement.
Triggering Events.
Funding the Buyout.
Stock Redemption or Entity Agreement.
Avoiding Dividend Treatment.
Stock Attribution Rules.
Redemptions to Pay Death Taxes.
Alternative Minimum Tax.
Accumulated Earnings Tax.
Split-Dollar Redemption.
Disadvantages of Redemption.
Cross-Purchase Agreement.
Trusteed Cross-Purchase.
Partnership Cross-Purchase.
Split-Dollar Cross-Purchase.
Wait-and-See Buy-Sell Agreement.
Employee Stock Ownership Plan.
Estate Tax Deferrals.
Premium Allocation.
Valuation.
Transfers for Value.
Combining the Life Insurance Retirement Plan and the Buy-Sell.
S Corporation Buy-Sell Issues.
CHAPTER 13: Asset Protection Strategies.
Ethical Obligations.
Exempt Assets.
Gifting Strategies.
Choice-of-Entity Implications.
Part Four: Compensation Planning for the Entrepreneur and His or Her Employees.
CHAPTER 14: Cash and Deferred Compensation.
Bonuses and Deferred Compensation.
Constructive Dividends.
Company Retirement Plans.
ERISA Compliance.
ERISA for Deferred-Compensation Plans.
ERISA for Split-Dollar and Executive Bonus Plans.
Related Issues: Age and Sex Discrimination.
CHAPTER 15: Equity-Based Compensation.
Stock Options.
Incentive Stock Options.
Nonqualified Stock Options.
Restricted Stock.
Phantom Stock Plans and Stock Appreciation Rights.
Part Five: Managing Capital Events.
CHAPTER 16: Buying or Selling an Entrepreneurial Business.
The Client's Objectives.
Financial Information.
Guidelines for Reviewing Standard Accounting Opinion.
Contracts and Continuing Obligations.
Leases and Properties.
Federal Taxes.
State and Local Taxes.
Internet Domain Names, Patents, Trademarks, Trade Names, and Copyrights.
Permits, Licenses, and Franchises.
Liens, Judgments, and Deeds.
Employee Benefit Plans.
Unemployment Compensation Rating.
Stock Certificates, Options, and Records.
CHAPTER 17: Succession Planning.
Federal Tax Rules.
Tax-Deferral Opportunities.
Valuation Strategies.
Income-Shifting Techniques.
CHAPTER 18: Initial Public Offering.
Public Life.
Preconditions.
Registration Team.
Registration Process.
Nontraditional Alternatives.
Index.