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A Wealth Advisor for Entrepreneurs Will Add Value to Your Start-Up Business.

As a CEO, Founder, or Entrepreneur, you face unique challenges in financial planning. As a start-up business owner you must overcome conflicting goals:

Protecting your capital while growing your portfolio.

Compared to those who work for a publicly traded company, an executive in a start-up business must place survival as their top priority.

Being an experienced professional in your specific industry may not always entail knowing the ins and outs of maximizing and preserving wealth. A wealth advisor who specializes in businesses with inconsistent income can help here by evaluating all provisions and calculating potential impacts, all while keeping an aim placed on your long-term goals.

Here are some ways wealth advisors can add value to your start-up business.

A Wealth Advisor will help with Personalized Investment Strategies

Investment portfolios differ from one client to the next. A wealth advisor can create a personalized investment strategy based on your start-up. Factors a wealth advisor will consider when building a customized investment plan include the following:

  • Risk Tolerance - What is your comfort zone when investing?

  • Timeline - How quickly do you expect to see results? How long do you plan to stay with the company?

  • Liquidity & Exit Plans - What do you expect to gain from your business when selling? Are there specific ways to mitigate the tax liability and maximize the take home?

After understanding our client’s risk tolerance, timeline, potential liquidity, and exit plan, a wealth advisor can begin to personalize a diversified investment portfolio. A portfolio with diverse investments faces fewer risks than a portfolio or concentration of wealth with one theme of investments or asset class.

Equity Compensation Plans

Many start-ups will offer their employees equity compensation. Equity compensation is an ownership stake in the company provided to employees who meet the internal vesting requirements.

There are many types of equity compensation. A wealth advisor can analyze the provision of the different equity compensations and determine the best option for your start-up and employees. Various equity compensations offer multiple incentives for the business and the employee.

Some types of equity compensation a wealth advisor might suggest to a start-up include restricted stocks.

Restricted stocks are stocks with provisions or rules for the receiving employee(s).

  1. Restricted Stock Award (RSA) – An employee offered an RSA is an immediate shareholder with voting rights. The employee is not obligated to provide payment for their equity compensation but must meet specific performance requirements to avoid forfeiting the award.

  1. 2. Restricted Stock Unit (RSU) – An employee offered an RSU is not obligated to provide payment for their equity compensation. However, the employee is not an immediate shareholder. An RSU can be an incentive for long-term employees.

When it comes time to make crucial decisions for your start-up, having a wealth advisor at your table will make all the difference. Many factors are at play when maximizing a start-up business, and a wealth advisor analyzes all possible outcomes to provide you with the best answer.

Park City Wealth Advisors specializes in the unique challenges our clients face. We understand the demanding lives of CEOs, Founders, and Entrepreneurs. Ensure that your start-up’s financial health is constantly cared for, no matter how busy your day is.

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