← Escaping the Drift with John Gafford
Escaping the Drift with John Gafford
Navigating Tax Strategies and the AI Revolution with Neil Jesani
00:52:27
Loading summary
Transcript91 lines
- [00:02]
A
We're spending more than ever. I hate my job. The price of everything has gone up.
- [00:06]
B
AI is threatening my job. It's crisis after crisis.
- [00:09]
A
Nothing is working out.
- [00:10]
B
I can't find a We're one disaster.
- [00:13]
A
Take control of change. I need a change. Disruption is the force of change. Stop the chaos. Stop the madness. Take control. Read James Patterson's Disrupt Everything and win. Hey, it's John Gafford from the Escaping the Drift podcast. And big news. My new book, Escaping the Drift, is coming out November 11th. You can pre order it right now at thejohngafford.com There are tons of bonuses, tons of giveaways. Get the book. If you are somebody that feels like you might be drifting along, this is for you. If you know somebody that feels like they might be drifting along, this is for you. Available everywhere, all bookstores, everywhere, Amazon, Barnes and nobles, the whole nine yards. But pick your copy up right now at thejohngaffer.com and get a bunch of the awesome bonuses I've thrown out because I promise you, I put my heart and soul into this thing. I want it to help you change your life. Pick it up everywhere. I'm going to back up on that story because you said something I was a little more a little interested in. Which was number one. What was the book? Do you remember? And now, Escaping the Drift, the show designed to get you from where you are to where you want to be. I'm John Gafford, and I have a knack for getting extraordinary achievers to drop their secrets to help you on a path to greatness. So stop drifting along. Escape the Drift. And it's time to start right now. Back again. Back again for another episode of like it says in the opening man, the podcast that gets you from where you are to where you want to be. And today, beaming into the studio, we are lucky to have somebody that has been a consistent considerator, all kind contributor to all kinds of places like the Wall Street Journal, cnn, Forbes, cbs, NBC. Every. I mean, l, everybody. This guy's got an opinion. He wrote a great book back in 2008 called Win the War for Money and Success, An Investment Guide to Long Term Savings, Financial Growth and Retention. And we are lucky to have him beaming in the studio today. Ladies and gentlemen, welcome to the broadcast. This is Neil Giussani. Neil, how are you, sir?
- [02:17]
B
Thank you for having me, John. It's always pleasure to talk to you.
- [02:21]
A
Yeah. So before your life is a tax expert, you were in the entrepreneur game. So walk me through your. Your ventures. How'd you get started, what'd you do and what happened?
- [02:34]
B
So originally from India, came into this country in 2000 and you know, I started working with firm in you know, New York City. It was, you know, tax and financial planning firm. I really enjoyed it. This is what I did. But you know, I was very, very fascinated by technology and you know that I had some entrepreneurship as well. So that actually when I got my green card and you know, my actual work permit, I started my first in actually 2007 and since then my entrepreneurship started. So I started the first company. Then I ended up starting in actually HR software company. Obviously I'm not the kind of actual technology guy, but I always had kind of actually co founder who are technological and I'm more kind of business finance guy kind of things. While building the HR software company, I stumbled upon actually cyber security idea. I built the cybersecurity service and product company and we ended up getting exit in 2008. And then actually I moved to Florida. I had no desire to really do anything except work out from my home and actually workout clothes. I came in over here and actually fast forward. Today I run successful tax and accounting firm. We are close to 60 people with three dozen or so tax returns, attorneys and you know, CPAs and so on so forth. So you know, sometimes God takes you, you know, where you have no idea. So but it is all good so far.
- [04:14]
A
It will back up a little bit because you talked about moving here from India. Tell me about your growing up in India. Tell me about that.
- [04:22]
B
So I grew up in average family. I was, you know, I grew up in a very small town in India, you know, western part of India called, you know, Gujarat and you know, that other. But I was, you know, actually, you know, actually very good at education. So happened to be at right place, right time. Even though I was probably second in my family to get the college degree. But as I happened to be a bright student, happened to go to the good school and I ended up, you know, getting the great education. And then, you know, before moving to us I went to Dubai. But that does actually India part. I was there until I guess, you know, until my age 25. And then I moved out of India.
- [05:02]
A
Were your parents wealthy people or not wealthy people?
- [05:04]
B
No, they were. They were just healthy people, nice family. But it was hardworking. But no, there's no money. In fact, I used to laugh, John, you know, actually when you're asking, you know that actually I used to laugh and I would ask people that, do you know how many people used to die in my town in a car accident, and people will throw some numbers. And I said zero, and there was no cars.
- [05:29]
A
The reason I bring that up is because, you know, coming to this country from India, when you were a boy, growing up in that. In that, you know, not necessarily destitute, but, you know, seeing what you saw every day. Did you ever dream that you could have the success that you got by moving to this country?
- [05:44]
B
No, I had, you know, I had no vision. You, you know, you grow up as like a normal things because that other, you know, you grew up in average family and that. I think these are very, very important questions which we can touch upon in the other context as well. But so many a time, the. Where you grew up does matter. So that there. So there was no vision. There was nothing, you know, that there, you know, there was no guidance by the parents, even though it was a great family. But they can tell you that, hey, son, you know, I should work hard and go to Harvard or actually Stanford or do this one or something like that one. So, no, there was essentially nothing. It just happened.
- [06:23]
A
The reason I say that is because I think, especially since COVID like this level of apathy that runs through people in this particular country, that there's some sort of systematic force that's holding you back, and the system is designed so you can't succeed. I imagine coming from the situation that you came from to this country, you just have zero tolerance for that type of thinking.
- [06:45]
B
Oh, absolutely. It's so funny you're saying, John, this is what something is very. I tell sometime people that people who are. Are born in this country, they don't understand the value of this country. How fortunate is to be American, basically? So that other. No, that other. I don't have any tolerance for that one. You need to really work hard. There's a tremendous opportunity. Look at the guy who comes from India, you know, those kind of things, you come over here and you build. So this country rewards as long as you are, you know, hard working. I'm not sure you know, Chet Holmes, but, you know, Chetholm used to say that anybody can make a decent living by working half day and half day, meaning 12 hours, right? So that the meaning. Meaning that actually you need to work hard. And if you really become good at what you do and if you have your ethics in a place, I think, you know, you can achieve whatever you want to achieve in a life. And at the end of the day, goal is to be happy. Obviously you want to, you know, try to make, you know, the Tax or decent money that you could. But end of the goal is to be happy in a life. And as long as you do the right thing, I think everything falls into place.
- [07:56]
A
How do you break the thinking? How do you break the thinking of people that are stuck in that kind of rut to think that way?
- [08:02]
B
I think my, you know, John, my fundamental theory is hard work solves all the problems. I think problem is probably the hard work, you know, so that other, as long as you're putting the efforts, you know, you will get the result, right? I mean that we have, you know, since so many times the average people, you know, putting the efforts and they will go far in a life versus, you know, brilliant people, but they are bozo lazy will not go far, right? So that I would say somebody has to tell these people that hey, put some more efforts, you know, and that other, you know, actually once you put the right efforts, you know that this country there are many people who will recognize your efforts. So if you're busting your chops, somebody say, hey, this kid or you know, this guy is working hard, you know, I need to take care of the him. If I'm not taking care of him, somebody else will take care of him, right? So better I take care of him and you will get to the places. So I think, I personally believe that other, you know, hard work and ethics, I think it is, you know, very, very important.
- [09:09]
A
When you first came to the country, did you find somebody that you would identify as a mentor and how did you do that?
- [09:15]
B
So that other I, you know, it was actually great question. So that there when I came into this country, I work in, you know, New York City for almost seven years before I started my own. That place happened to be a great place. We had some, you know, three floors, you know, 300 people, you know that they're, you know, they gave us a training of, you know, working at least 12 hours a day. So I used to reach office at 7:30 and never left before 7:30. So in that scenario and that actually quick story, I think this is going to help you. So you know that actually my boss at that time gave me a book and said that Daniel, why don't you read this book? So that he said, how much time do you need? So I said maybe week, 10 days. So you know, at that time I used to sit in area. So he came in to me after 10 days. He said that, can I have a book? I said sure. He said that. So he took the book in his hand and then he said, Neil, did you read it? I said, yeah, absolutely. It was very nice. So he said, you know, by the way, I forgot Neil, when I gave you book, every time I give the book to anybody, I did also ask him to prepare a one pager on a book for me. So have you prepared the one pager? I said no, I was not aware. So he said that I'm going to be here. Why don't you, you know, write, you know, that other one pager. So obviously he knew that I was bullshitting that I haven't read the book. Long story short that he said to me, he said that don't give me bullshit ever. This is for you if you want to read and fast forward today, you know that after that one I used to read 50 books. It was a tremendous learning. You can get it. So on that way that other, you know that you will get many mentors, but especially that other I had that actually a few mentors who helped me to get where I am. And that other I that you're actually constantly seek for advice from the right people because as I'm building the company, even though it's natural to me, I build multiple companies and sold it, but still that if I'm building, you know, that actually half a billion, billion dollar, five billion company, you need to have a different level of advice. And obviously you need to have those mentors.
- [11:28]
A
Well, I want to. I'm going to back up on that story because you said something I was a little more a little interested in which was number one, what was the book? You remember, right?
- [11:36]
B
I don't remember. I think it was maybe think and grow Rich or something like that. One of those kind of book was there, but it was very, very eye opening.
- [11:45]
A
Well, here, well here's. Well here's the second question to that, which was what do you think it was about you that didn't make him just say this kid's a bullshit artist and move on to the next person. Why did he make the effort to say, okay, I'm going to take this as a learning and continue to mentor this kid. What do you think it was about it?
- [12:03]
B
I think they seen that other. I was actually genuine guy. I was, you know, kind of. But, you know, never really understood the value of, you know, reading the book. And that other. It is also so funny. I used to read many books in India because, you know, I went to the great school and all those kind of things. And then I went to Dubai and I lived in Dubai for four years. And I can tell you, Dubai probably I Read maybe three or four books in total in four years. So probably I lost my habit. Bit of probably, you know, reading the good books. But when this. That actually I came in over here, this guy probably seen the talent in me, but probably thought that other. I need a little bit slapped in my back, I guess.
- [12:44]
A
Yeah, there's little lessons. It's funny, I have a couple little idiosyncrasies that I use in my companies. Like, for example, if I'm interviewing for a position here and I know when the interviewee is coming in, I had the receptionist take one piece of paper crumpled up and set it right outside the front door on the ground. And I want to see if they step over it or not. It's these little things like that.
- [13:09]
B
Absolutely.
- [13:11]
A
Yeah. I think the truth with people lies in the fringes and not so much in the resume. And I try to get as. As good a view into the peripheral as I can. So that's. So I can see why he would probably call you on that and maybe push you to the next level. So you read 50 books a year. What's your method for absorbing information like that?
- [13:29]
B
So it's. It's so that, you know, I used to do maybe I read 25. Listen. 25. You're actually audible at the time. Remember that one we used to do? Nowadays, you know, you actually transition from books to more kind of podcast. And you know, that one. Our actual consumption has changed still. I try to make a habit because, you know, we become habituated to our, you know, smartphone. So somehow you try to put it away and, you know, try to read actually physical book. But you know, that either way, either you listen or you, you know, read basically. But somehow it gives you. Now obviously now I'm at the stage that it is actually went down of the 50 books, probably went down to 15, you know, 20 books. But still, you need to keep yourself up to date because, as always, you can learn new stuff.
- [14:17]
A
Are there any of those books that you go back to?
- [14:20]
B
Yeah, absolutely. So that there's about, you know, actually think and grow rich. I asked, you know, actually Good to Great or, you know, Built to Last by, you know, Jim Collins. Those are some of the guiding principles that, you know, that are all of my hiring. You know, actually, you said about hiring and it is, you know, I use that one literally every day. What actually, Jim Collins says, right. It is a who before what Normally we, you know, that you should come up with the, you know, job description and try to match that one with person. He said, no, no, no, it is other way around. If you hire the right guy, then they will figure out what to do. Basically that's been said. Certain job requires a certain qualification. But end of the day that actually whenever I hire, it is all about people. And I guess that, you know, yes, you need to have a systems and processes. But I learned very earlier on it's all about people, people, people.
- [15:18]
A
Yeah, that's a shift that I made in my businesses a while back when we went from, you know, because some of our businesses are pretty niche and there's not a lot of people that work in those industries. And when you hire people that are available in those industries, they're available for a reason. And so we were like, okay, no more industry experts. Let's just hire the smartest people we can find and we can teach in the industry. And yeah, you can teach a smart person anything. You can't teach a lazy person to work hard.
- [15:43]
B
No. And that and that other. The idea also the another one, John, is that, you know, I tell people also I don't want to build the horizontally very fat organization. You want to have that the small number of people, but highly paid and highly, highly educated. Basically, that's where the money is that you want to hire the people those are extremely talented, you know, pay them way more than the average. Basically. You know, somebody said to me very earlier on, if you will pay peanuts, then you will get monkeys. So you need to decide actually what you want.
- [16:18]
A
Yeah, that's. That's very true. That's good. When you're building out your teams and you're trying to create culture in your companies, what do you do to make sure that the culture is steady and creates an environment where people want to stay?
- [16:34]
B
So that is actually very, very important question you ask. And this week actually I was at the CEO meeting in Orlando and we talked about the culture. And so I said that, you know, that actually one of my. So that so far we are in 10,000 square feet office over here in the texture Miami and we are feeling more tight. So I'm actually negotiating 30,000 square foot office. But at the same time I was thinking that I might be needing some more also that even though we are in actually Miami, our 60% client are in California. So they are in Pacific time zone.
- [17:16]
A
I guess if you're going to do taxes fish where the people are getting taxed the worst.
- [17:20]
B
I guess, no wonder, right?
- [17:24]
A
Help us, help us.
- [17:26]
B
So, so, so, so that actually, I said that actually what if I build the, you know, that other more kind of you know, remote team in Pacific time zone. But the one of the concern I had, the biggest concern I had, I was not worried that if they are remote, they will not work. Because at the moment I have a few people remote that maybe, you know, around 20 people are remote and you know, their performance is equally same. So I do believe again that boils down to the first principle. If you hire the right people, irrespective they are sitting in front of you or they can be anywhere, they will produce basically. So that other. But. But that my worry was that one that if they will remote, they will not get the culture aspect basically. So that is what was my biggest worry is that because the kind of culture we build in office. And then by the way, John, if you are going to me, Neil, how did you do that one? I don't think so. It's my smartness. It just happened. In a certain time you get lucky and you know, if you. If you hired the right people, it just happens. So it's. It's a lot more fun. But now I build it. Now I understand the value that I want to give this one. I don't want to lose this one. So that was my worry that if I build the remote, I will not have. And that this, that. Actually another CEO gave me the idea. He said, Neil, he said that I run 175 people company, all our consultant and all of them are remote. And our culture is as powerful as it gets, basically.
- [18:56]
A
Yeah, that's so interesting because like, you know, Simon Sinek and I subscribe to this too, who says, you know, the magic is in the hallways. That the magic is in the hallways, how they interact with each other. And I just. Man, I know with COVID we went to a work remote thing and I think a lot of the big companies are calling people back to the office now because they're feeling that loss. So that's really exceptional that you guys have been able to maintain that. Let me ask you this. Is there a metric that shows your turnover lower on in office employees versus remote?
- [19:26]
B
No, it is, it is, it is, it is the same. Because that other. As long as you take care of the people. So that actually what I did is that other we, you know, that they're higher more kind of, you know, that an actual VP of culture basically. And that person is more like a relationship manager for internal style. How we have a relationship manager for a client who works for a client. But this is, you know, checking on you. John, you are there. So John, how are you doing? You Know how is your day going? Anything that you need from office, any constraint, you know, any, anything work wise, you know, HR side anything, you know, that invite to the office for a week when come over here, set up some dinner with appropriate people. You know, get on a boat, you know that actual company on the boat, you just, you know, take them over there or something. So in that one, even though that person is far, that person feels that hey, I'm you know, more kind of integrated, yes, I'm that value, you know that I know these people and so on so forth. So I personally don't see. But that's been said certain position you can have a remote and certain you actually cannot. So that other we made a conscious decision. So we understand this position would work remote and which position needs to be office. So so that actually certain that's a position like an RM for our, you know, client in actual relationship managers. We want them in the office. You know, some of senior advis. You know, we want them in that other office basically so that certain position would work in office. Certain position can be removed.
- [20:58]
A
How do you balance your old school 12 hours a day with the new workforce? Freedom of work time philosophy. Is that something you wrestle with with yourself or what do you. How does that work?
- [21:10]
B
No, because the other I think it is again bolts down. So if you hire the right people they will figure out so that in fact in our office there is no micromanagement, there is no bullshit there. You know that the fluff either you're with us, you're not creating value and you know, making lots of money for yourself and you know that actually making money to a company and you're with us or you're not with us so that we don't ask them. But they will know that other people are working hard, you know, other people are actually creating that other, you know, that kind of value. So essentially system will reject you, you know, so I don't need to let that person go. The office will reject it. So that person will, you know, get out quickly. Or you office say that Neil, that actually whom did you hire? You know, those kind of stuff.
- [21:58]
A
Yeah, I heard, I heard an interesting concept the other day about the difference between outcome and output. And a buddy of mine runs his stuff and he's like everything we do is on outcome. Like I, I don't care what your output is. Like, I don't care if it, if it takes you 3 hours to do something or 14 hours to do something. All we care about is the outcome. And as long as the outcome moves the needle financially for the company, then we're good. We don't care when you come and go. I don't care what you do. I'm just everything is based on outcome.
- [22:25]
B
Absolutely. And that actually what you said, John, that I learned in my school, in my management class is the responsibility and authority is two sides of a coin basically. So meaning if you are giving somebody responsibility then you need to give them authority as well. It doesn't work one way. So meaning if you are expecting somebody to work hard and that guy or that girl has a right of flexibility as well. So you know, if you choose to work from home or you say, hey look, I'm feeling a little lazy, I'm going to go to office 11 o' clock today, that's fine. Just, you know, that actually figured out.
- [23:05]
A
Just as long as the outcome is the same, I don't care.
- [23:08]
B
I don't care. You know, let me.
- [23:10]
A
I'm assuming that all of your employees are incredibly empowered to solve problems as they come up on behalf of the company. That's not obviously something you have baked into your culture. Culture, I'm assuming.
- [23:19]
B
Absolutely. So if you look at, even on our website base, you know, we're you know, recruiting or you know, your career page, you will see word, it's all of our people carries the designation called pps. It's called professional problem solver. So we call them, they are professional problem solver. We get paid. Right. You know that I think it was a Jim Ron said that when you get paid in a marketplace in a direct proportionate debt problem you solve. So if you want to get paid more, solve the bigger problem. So that's what it is. So it is the same that other, you know, our philosophy is that we get paid to solve the people's problems. So the same way they understand that they are here because they are solving the problem. So yes, that they are problem solver and that's why they will be here.
- [24:08]
A
Well, let's talk about people that work for you that give you problems and I don't know if this has happened to you, but in this day in the age of social media where everybody gets to have an opinion on everything all the time on their social media. Do you guys at your company have some sort of a social media clause to protect your brand based on views that may not align with anybody and have you ever had to enforce that?
- [24:32]
B
So so far no. That other lucky you don't have any policy. But again that we are not that big as well. Right. 60 people it's not that big that once you become certain size, it's going to come. But, but at the same time I'm of the opinion that you should have a freedom up to some extent to express yourself. That is what this country is all about. Yes, you need to be mindful and you need to be very sensitive. But at the same time it is okay. Similar way, even I'm okay sometimes because our kind of firm that you don't get a lot more Google review because our client, I'll tell you something, that is what you're going to like, John. So you know that I do have the actual marketing guy who manages our ad, but I do look at as well and I do understand. Guess what? Whoever completes our calendar booking, meaning who schedules the call, right? Those people never likes our ad. Meaning they remain totally anonymous and that whoever likes our ad, whoever likes those are never booking to our, you know, those kind of things. So. Meaning our clients are very secretive. You know, they don't put any reviews, those kind of things. So we don't really care. But certain times, you know, some clients are happy or unhappy put the review and at certain times some employee comes to me and say, hey Neil, somebody put, you know, that other not so nice review. I said, you know, sometime it is a good idea, you know, because that people should have a right to, you know, post that one, you know.
- [26:02]
A
So my, my EA this morning she was going through my email. Yeah, here's a, here's a, here's a spoiler alert. If you send me an email, it's not me reading it, it's my executive assistant. But I do craft responses when I need to. But she, somebody had emailed this morning and said, you know, one of our brands had a one star review on it. You're talking about hundreds of reviews on our brands and had a one star review. And this guy was offering for $300 to remove it. And she came and said, hey, what about this? This seems like a good idea. And I was like, no, it's a terrible idea because a, if you pay somebody to remove a bad review, you're gonna start having a bunch of, you're gonna have a bunch more bad views mysteriously start popping up that they can remove again. But I said number two, I think you kind of want to have a couple of bad reviews because it makes the five star ones look genuine. I mean if all your reviews are five star, that doesn't look real.
- [26:48]
B
Exactly, exactly.
- [26:50]
A
People that are, that are nuts in.
- [26:52]
B
There that said something and that I feel certain Time. It is better for you to do business with me knowing my, you know that are actually witnesses, you know that it's okay everybody. I think, I think this was Anthony Robbins or something. You know that he said that whenever I should work with somebod or indulge into the business relationship, I will have the PI work on them. That private investigator will go after that one and say that I will give you opportunity to give you a response, but I will do that one. So that's fine. I mean that people have a right.
- [27:26]
A
Yeah, I mean, sure. So that's interesting because your business is tax is your business and wealth management's your business and obviously trying to save Californians is a big part of your business from the tax code there. When you have such a business like that, that's so niche, you said like you're running online like Google stuff. But what's your biggest driver of business? Is it referral? It would have to be, right?
- [27:51]
B
It is a referral, you know, because that other. We deal with a very small number of people, right? So we, that I said to you, we are almost 60 people. We are just probably cross the 500 client basically. So you're dealing very small number of client, you know, highly, highly educated, you know, very highly paid people. You're dealing with that one. So it is majority time, we get the actual referral. But at the same time you need to do some, you know, advertisement as well. So I think that's where we do Google, you know, LinkedIn, you know the transaction meta. We do some here and there, small, small stuff. So you spend a little bit money here and there.
- [28:28]
A
How do you. So when you're so niche, when you're so niche down on high net worth clients, which obviously that pays very, very well. I mean tax preparation for those people, I'm assuming when they come to you, you go back and recast old returns to look for places where they made mistakes. And I mean are you doing that on a fee basis, an hourly basis? Are you doing that on a percentage of recovered funds? I mean how are you, how are you, how's your business structured in that, in that aspect, Right?
- [28:53]
B
Yeah, so. So, so that in our industry there are, you know, actually multiple ways you can do something called hourly, something called value, you know, value pricing basically. So that our one is kind of hybrid. So what we do that we will give you certain, you know, bundle pricing. So you are our, say that actually CFO client and we will charge you based on your complexity or the opportunity, the X number of dollars basically. And that at a certain amount we will have out of scope work. So let's say you come to me and you say Neil, I do have actually multiple company but I do have partners and I'm not sure they would be ready or this one or that thing or that. I like my CPA but on my personal side I make $5 million. I'm paying too much in taxes. I would like to do something. So we will do the personal engagement with you and we will put the other work as out of but the hourly basis. So meaning so that we work with you and you say Neil, you know that actually working with you looks like, you know, I want you to take over my business as well. I want you to do my quickbook, I want you to do my, you know, this kind of thing, you know, entity planning or this one or that thing. So those are the out of scope work. So we have the attorney hours that are actually we charge, you know, CPA hours we charge. So those are hourly base. But otherwise we would be able to give you you know, bundle pricing basically. So you pay one price for one year. That is engagement irrespective how much. But you know, whenever you have a client you are going to save many fold than what you are paying. That's why otherwise we will not take you as a client. If you're not helping you save lots of money many fold and what you're paying to us then probably you don't need us. You are, you know, already dealing with somebody.
- [30:30]
A
What's your, what's your plan to scale? You're at, you said 500 clients now 60 people. You're growing. What, what's your, I mean do you, I mean are you going to have a hockey stick moment do you think or do you think it's just going to be a steady and inclined.
- [30:41]
B
No, that hockey stick moment. I think the way we are that you know that actually personally there's a lot more opportunity that what we are doing and we can see the demand and people needs it, you know, those kind of things basically. So I think we are having the hockey stick moment. So if that everything goes well, who knows you can take this baby to public in you know, that other four or five years. And the reason I'm saying public is generally professional services firm, do not go to the public. You know there are few, you know, handful but you know, the big four if you look at they are still, you know, partner owned and so on and so forth. So why public? Reason. Public is the kind of culture we are building. If that, let's say PwC is going to, you know, buy me, either they are going to fire me after six months or I'm going to fire them. So I would like to run this place. I would like to maintain the culture. So if I take it to the public, I can, you know, still we have some little, you know, exit event and you can have, still you can run the place, basically.
- [31:41]
A
Is that why, because you're so concerned about the culture, is that why you don't try to grow through mergers and acquisition like other firms?
- [31:48]
B
Yes, exactly. I'm just going to grow organically. That's been said. You know, we might buy in a year or two something very complimenting to us. So let's say, you know, you buy some extra billion dollar business, you pay them, you know, your quarter billion dollar, you know, three quarter in the stock and so now you are, you know, debt action, enhancing the value of your entire organization and that's what you can do. But otherwise the normal accounting or wealth management firm, I would never buy them or never merge with them.
- [32:19]
A
Yeah, because if you had an interest to go public, I mean rolling up like businesses into a spac, even though that's lost its shine a little bit, I think that's still a vehicle that can make that happen. When you're dealing with, with people that need tax help. Right. When you're looking at that, what's the biggest mistake that you find that they're making? If you had to just say one.
- [32:41]
B
So most people. So I think, you know, we can put the people in a two category. One is a high W2 earners basically. And that when I say high W2 earners, meaning, you know, anybody making more than $2 million in W2, basically. And that other, you know, California technology firm.
- [32:58]
A
Terrifying. Terrifying. That much money on W2.
- [33:01]
B
No, no, absolutely. So, so, so that is what is actually one bucket. Other bucket is obviously very successful small business owners. Right? So let's go over the high W2 the mistake. It's not essentially mistake, but they've been brainwashed by their CPA or the general public that nothing can be done because you're a high W2 earners. So nothing can be done. So that's wrong. In fact, we can do magic and we can, you know, you know, that help you quite a bit in terms of reducing your taxes. So I think that is what one mistake you see. And the second mistake is on the very successful small business owners. I guess they are also somehow stuck with the smaller stuff. So in their mind, the deduction meaning hiding more people spending more money on advertising or some equipment or Augusta or that are the actual home office deduction or business mail or business travel or those kind of things basically. But there are so many other strategies can be done which is very high end obviously that it requires lots of efforts and you require really smart group of people behind you basically. But I think that is what the mistakes we see normally and they tell actually when they come and there's an aha moment occurs. Most of the clients say Neil Gus, I would have met with you five years back and how much I would have saved that certain time. But you know, that is all good. But I think that is what the mistakes we see certain times.
- [34:35]
A
What do you think the best vehicle is for tax savings?
- [34:39]
B
So that other there. So. So.
- [34:41]
A
And I don't mean Range Rover. That's not what I meant. If you're listening to this, I didn't mean go buy Range Rover. Yeah, yeah, you know, £6,000 or £7,000, whatever it is.
- [34:49]
B
Right. You know. Yeah, no, that does actually, you know, we do use many, many strategies but just to give you some high level ideas basically so that we use use kind of depreciation based strategy. So meaning so many people has the real estate basically so that you can use that one and that you understand the real estate well.
- [35:12]
A
Cost segregation, two of my favorite words.
- [35:15]
B
Exactly. That's the second one we use is we use actually heavy construction equipment basically. So it is the same thing. But now that you can get 100% depreciation rather than even with cost segregation study it is 20, 25% of the value of the real estate. So here you can get 100%. So meaning you don't need to buy that much real estate, you can buy 1/4. So that could be very complementing to the real estate basically. Other things we do is that the many, many strategies based on extra charitable donation you can become very, very creative. You know, especially if you have some highly appreciated assets and so on so forth basically. So that I think that would be the another strategy we do some of the enterprise risk management based strategy. Some of the different that are actually entity planning and you bring the different tax bracket that actually basically you will have a different level of the exit that are actually planning. So these are many, many strategies you do. But these are some of the big one and that actually these are. We are talking. Those are actually strategies end up in millions of dollars of deduction. Obviously these are so many normal stuff. You're actually putting your kids on a payroll or you know, other stuff. Those are all, you know, actually given.
- [36:33]
A
Basically at what point Because I, I think it's so funny. I run into people and a, a friend of mine, a guy that came up pretty fast and does extremely well and you know, all of a sudden he was writing checks for like 2 million to the US government every year. And it was just like. And just he got around a different group of people, us and they started introducing to people. And then he bought an 80,000 square foot building in Atlanta and started doing all of the things that you should do with cost segging and you know, right off the old roof as it comes off in that cost sag and all of these things that we know through real estate investing. At what point do you think like say your average taxpayer, at what point do you think you write a check to the US government? You really need to get somebody knows what the hell they're doing. I mean is it the first dollar, is it 10 grand, is it 15 grand, is it 100 grand? At what point?
- [37:26]
B
Right, yeah. So, so, so, so, so that I personally believe that you know that everybody should ship, everybody should pay the fair share of their taxes basically because even though we like it or not and that I'm in a business of saving taxes but you know that the majority of the revenue comes from a taxes. So if everybody does the tax planning then how the government is going to run we might not see this kind of road and all those kind of things. Right. So basically so that actually everybody needs.
- [37:58]
A
It'S going to run because of tariffs. Don't you watch the news, Neil? It's tariffs.
- [38:05]
B
I personally actually big. You're actually big proponent of the actual tariff as well. And you and I can talk a little bit more about that one. But actually coming back to your question, so normally I would say the, that if you're self employed then you can do tax planning at any level. So meaning even though you make an extra $50,000 from your side gig, you would be able to do that one. But let's say if you are W2 earners there's not a lot more things you can do. So for the W2 earners I would probably say once you cross three $400,000 maybe half a million dollar then you can start doing some of the real estate kind of things, cost segregation and so on forth basically obviously we take client who makes at least $2 million a year but at least they can use any other advisor and they would be able to help you do that for business owner. They can do it at the early stage. But that, you know, certain time I that also tell the people, let's not tell wag the dog. Let's not be your, you know, decision based on only taxes. You know, certain time you are growing the business. Just grow the business. Don't worry about the taxes. You know, that is what you can deal with later on. Because if you are so much focused on the taxes but if you're not growing the business. Hey, you missed the bus.
- [39:17]
A
Who knew, right? How is, let me ask you this, how is age AI? How are you using it now and how are you projecting it's going to change your business?
- [39:26]
B
Sure. So AI that, so that actually this is what I say. I think it was, you know, Bill get said that one, that we overestimate the impact of technology in a shorter run but underestimate over the longer term period, basically. So I'm, I'm a strong believer in that one. And if you look at the history, you know, Internet, if you look at when it came in and we had Internet bubble and fast forward, some of the companies survived, they are actually trillions of dollars worth today. Right. Basically. So I personally believe that AI is really, really big and that other, you know, that even though there's a big hype, I think it is going to go down. But you will see the real impact maybe after 5, 7, 10 years. Basically you are going to see the real winners in the AI and real impact in the AI unless I'm wrong. And you are going to see it sooner. Basically.
- [40:19]
A
Yeah, I got to, I mean look, I think you're going to see a massive elimination of jobs, low end jobs in this. I think one of the mistakes I had my friend Michael Ruckman on not too long ago who is a change, he's a change specialist for major corporations around the globe. He comes in and helps them with change. And he said something I thought was so smart, which was if you look at how AI is built, it's Kirk and Spock, let's nerd out and talk Star Trek. Right? Because as humans we start with emotion and we're trying to get to logic. But AI is starting with logic and can't get to emotion. It's empathy. So there's this disconnect and major corporations are trying to eliminate the lowest hanging jobs from their workforce which in most cases are the most customer front facing. So you're putting something that is not equipped to have an empathetic conversation with a customer on the front line. And I think the thing for me it's not Even this country that I'm worried for. No, if you look back three, four years ago, the amount of outsourcers that we hired through upwork that were in India that would do basic research, basic tasks, all of these things that they were doing for us, we don't hire any of those people anymore because that's all done by AI now. So I mean I think you have a unique perspective here being how you grew up there. What is it? What does a country like India do when so much of the workforce is dependent on outsourcing from other parts of the world? What do they do?
- [41:48]
B
Great, great point. And that, that is what I said. This is good thing basically because I you know, I that also use the word which is most people don't so that we use the word AI which is artificial intelligence. But there's another word is hi human intelligence. So if you look at that one that it has been said that the human is the God's finest creation. And what is something makes us the US the finest creation of a God is is we have intellect which is other living creature does not have. Right. Basically. So meaning human brain is so much powerful. So so far, if we were doing the menial job, we shouldn't be doing that one. We are capable of doing so much, much more intellectual work. So meaning certain time we become so complacent of doing answering that phone and transferring that phone to the appropriate person or sending them, hey, go here, do there. You know, those kind of things that can detection via AI. Even though I might feel and that I'm going to lose my job now and I might feel for a moment, hey AI, you actually displace my job. But it might force me to learn something new. And guess what? Earlier I was making $18 per hour, but now I might make $60 per hour, $80 per hours. If you look at that actually, you know, AI factories. If you look at the some of the people they hire, the you know, electrician kids from a high school, they paid them $80,000, $100,000. Those people trained them for the six month and now they don't need the college degree and those kind of things. So I personally believe that you are going to see quite a bit shift in the actually human intellect basically. So even though it might make us lazy at the front end, but over the longer term period and that the actual reason I'm saying that one John and that you might not agree, but if you look at was I have a counterpoint.
- [43:49]
A
I have a counterpoint. No, no, no.
- [43:52]
B
The Actual reason I'm saying that one, I was at, you know, actually all in summit that, you know, actually la. You know, that other guys that, you know, they had actually AI Summit in dc. So that other, you know, I. I was there all of that when I looked at, basically. So that other. All of them, yes, that other. It might impact at the early stage, but if you look at that one, the history shows have, you know, that earlier we used to, you know, handle the machine, right? Basically, now we, you know, came way past. I mean, the same thing in India. And that I love about India is that, you know, thank God somebody showed us that, you know, hey, this is computer. And we were educated and we were able to do the work, basically. Otherwise, if you look at that one, the China at our lunch, basically. So if you. India was a manufacturing economy, right? We were very big in actual textile and all of those kind of things that, believe or not now India import quite a bit stuff from China. So that is essentially China at India's lunch, thank God. Just imagine if that somebody would not have showed us computer in India, right? So I personally believe that this is. So as India knows English well, as India has a highly educated people, and that India knows the computer, I think they will figure out some other work to do, which is more intellectual than, you know, the menial job that at the moment, we are outsourcing Fair, you.
- [45:26]
A
Know, and I have probably have more faith in the people of India to figure it out, honestly than this country. I feel like. I feel like we're going through this great dumbing down of America. Almost like the birth of social media is making. Like, there's a movie called India Idiocracy. I don't know if you've ever seen it before. It's like a dystopian view of the future, and I feel like every day we're a little bit closer to this. I feel like, you know, people get in their echo chambers, and they just want to be tribal and just want to repeat whatever they heard that their favorite pundits said and be. And that's it. And now you're like. And no offense to the ufc, because obviously we live in Las Vegas and that's one of our home teams. We're about to have a UFC fight. A UFC fight. Dudes in cages beating each other up at the White House. Like that. Is anybody else looking around at this? Like, this is like, why this is nuts, right? I just. And all I can think about is that movie Theocracy. And we just. It seems like we're just getting dumber and dumber and dumber in this country and I just don't know what's gonna change that.
- [46:33]
B
But you know, I'm, I'm probably way more optimist about the future than I was you know, six months back, year back.
- [46:42]
A
Okay, so why, what happened?
- [46:44]
B
Right, so, right. Yeah. So I personally believe and that other you know, irrespective which side of political view you are in but I think there's a lot more great things are happening, you know that are if you look at historically the Americans even though we say that, you know, actually we started that you know these people are not working hard. But if you look, look at the, you know, globally Americans are hardest working people basically, right? These people, they are hardest working people. They want to do the right thing. I think somebody probably needs to point them, you know what to work and where to go. So I guess that is what is happening. So that I personally believe that other with this kind of foreign direct investment coming to USA this manufacturing and they tell the, you know, actually whenever we are talking about the manufacturing now the current manufacturing is happening. It is all AI driven. It is very, very sophisticated basically. So it's not that you know, you would have seen some funny video that, you know that other, you know, that American, you know that are doing the, that actual manual work. No no, no. This is very sophisticated work. We are looking. So I personally believe that it is going to change people's mindset when they are going to see the power of that one. When you are seeing actually if you look at that one, the our growth has improved and that does actually whatever this card basin is saying 333 basically. So if going to see that kind of growth I think America, I personally believe that the bright days are ahead of us.
- [48:16]
A
Amen. I, I hope so. I, I, I genuinely do. I think that you know, I, I, I genuinely hope that's true. I'm trying to give as many people a road map to save themselves as I can. I don't think. I think waiting around for somebody to come by and teach you a skill set is going to be a losing profession. You need to invest in yourself and, and, and do that. And that's part of the mission of this show and a mission of my book that's coming out Novemb Things is, is save yourself. One more question, which is this, which is it's been toiled around with that the current administration would like to get rid of income tax. So if they did that, what would.
- [48:55]
B
You pivot to so you know what I worry about that one. So that there, you know that does actually attorneys in my office, they laugh and you know that I do believe in the deep down in my heart that you know tax code is not going anywhere. It's not going to happen. Remember that other I think the earlier Trump, you know that one there's actually one pager tax return majority of our client not majority but many of our clients tax return are more than thousand pages basically more than thousand pages. So meaning we deal with those kind of people. So that other, you know your point is that other you know it's not going anywhere and that other you know actually with the you know lobbying effort and special interest, you know there's a lot more opportunity But I do worry about that. Why? That's why our business is very very diversified. Meaning even though we do the individual tax strategies but we do for the mid market, you know the tax businesses even though tax goes away they will still needing the accounting services. They will be still needing the CFO services. You know we do have actual wealth management arm. So meaning if that other you know in income tax goes away meaning you have more money to invest meaning you have more money to you know we have more products to sell you product to sell you. So I do worry about that one because you know that John this is actually great question and that other you know I tell you know to the other people in the office as well I don't take myself as the owner of a company. I take myself as an investor in a company basically. So I think from the investors that actually point of view if you are buying my stock tomorrow, let's say I go to the public it's IPO. If you are buying how would you think about NJA? Why while you have another 5,000 company to invest your money. Right. Basically. So I think in this manner that how the investor will think so no that other it is actually great question and that I do worry even though nothing is going to change but yes that I do prepare for myself well.
- [50:59]
A
I'm going to make one assumption about if anybody steps in to buy your company, your balance sheet is clean. I'm going to make, I'm going to give you credit and make assumption that you have a perfect balance sheet. I'm going to make that absolutely. Well Neil, if they want to find more about you and connect with you, how do they do that?
- [51:15]
B
Absolutely they can go to neiljasani.com n e I l j e s a n I.com and they would be able to get all the information from there.
- [51:26]
A
And there you go. Well, thank you. It was a fascinating talk. I appreciate your time and having me. Yes, sir. So if you listen to that today, you know, look, the robots are coming for all of us. It's just the way that it is. Who knows? Go watch UFC fight in the White House. Who knows what's going to happen? But the one thing I do know is you've got to take charge of your own. We'll see you next time. Hey, it's John Gafford from the Escaping the Drift podcast. And big news. My new book, Escaping the Drift, is coming out November 11th. You can pre order it right now at thejohngafford.com There are tons of bonuses, tons of tons of giveaways. Get the book. If you are somebody that feels like you might be drifting along, this is for you. If you know somebody that feels like they might be drifting along, this is for you. Available everywhere, all bookstores, everywhere, Amazon, Barnes and nobles, the whole nine yards. But pick your copy up right now at thejohngaffer.com and get a bunch of the awesome bonuses I've thrown out because I promise you, I put my heart and soul into this thing. I want it to help you change your life. Pick it up everywhere. What's up, everybody? Thanks for joining us for another episode of Escaping the Drift. Hope you got a bunch out of it, or at least as much as I did out of it. Anyway, if you want to learn more about the show, you can always go over to escaping the drift.com you can join our mailing list. But do me a favor, if you wouldn't mind, throw up that five star review. Give us a share. Do something, man. We're here for you. Hopefully you'll be here for us. But anyway, in the meantime, we will see you at the next episode.