The Liquidity Event Podcast: Episode 69
Episode 69: Fresa con Crema
Gobble gobble, turkey fans! It's the special Thanksgiving episode of the Liquidity Event Podcast! Join AJ and Shane as they discuss the scarce IPO market, Tinder's recession-proof service, a run-through of headline hot takes, and a moment of gratitude--which makes this the all-time sweetest podcast episode ever. Happy Thanksgiving!
Read the Full Transcript:
Speaker 1:
This podcast is for informational purposes only and should not be considered tax or investment advice.
Welcome to The Liquidity Event, a show about all things personal finance, with a laser focus on equity compensation, hosted by AJ and Shane of Brooklyn FI. Each episode will take you through the week's news on FinTech, IPOs, facts, founder wins and fails, crypto, and whatever else these nerds think is interesting. Learn more and subscribe today at brooklynfi.com.
Shane:
Hello and welcome to The Liquidity Event. We're your host, Shane-
AJ:
And I'm AJ.
Shane:
And this is episode 69, nice, of The Liquidity Event.
AJ:
Nice.
Shane:
Surely, going to be one of our silliest episodes of all time. Episode 69 being recorded on November 18th 2022, heading into Thanksgiving. This is going to drop on Thanksgiving. Just a heads up, listeners, we have not read any of the articles this week. We are just going to do hot takes on the titles of the articles.
AJ:
Shane and I just got in a huge fight because I was like, "Oh, we are just going to hop in here and riff." And he got really mad at me. So, now, we're just going to riff for the rest of the episode.
Shane:
Yeah. So we also pushed this forward a few hours because you're a psycho about getting to the airport 14 hours early. So we're not going to read the articles, we're just going to-
AJ:
Oh, I'm sorry. Anyway, no IPOs this week, continues to be a desolate wasteland. Actually, that's not true. There's been a little bit of... November had its first $100 million IPO, which was cool. But, yeah, it's a dead week in terms of news. So we do have some interesting articles to talk about. I also thought, Shane, we could take some time, at the end, to just talk about what we're thankful for. It's Thanksgiving week, and we could maybe just slow down a little bit and reflect.
Shane:
For sure. I'm a reflection guy. Everyone knows that about me.
AJ:
Anyway, first up, we've got Tinder. An article from the BBC. Love our friends across the pond. More pay for dating-
Shane:
Why did you say BBC right after Tinder? I'm sorry, keep moving. You don't get that one? All right.
AJ:
No, I missed that one.
Shane:
Not a kids' show.
AJ:
Anyway, more pay for dating apps, despite cost of living crisis. I actually did read this one. And I think you did too, based on this note I see here. Basically, the premise here is that, even in a recession and cost of living going up and inflation happening, the world over Tinder is doing quite well. Dating apps are actually not one of the first things that people cut in their budget. People cut things like therapy, and grocery bills and, potentially, good financial planning. But they're not going to be cutting their dating app subscription. Thoughts?
Shane:
Yeah, I don't think, when people think about cutting discretionary spending, they think about cutting sex out of their life. Imagine being too poor to have sex. I don't know. Anyways, yeah, I read this article. And it's all about Match Group.
AJ:
I don't know what to say.
Shane:
That seems like an essential. You got to eat, you got to get shelter. These are things that don't-
AJ:
Episode 69, folks.
Shane:
These prices are inelastic. All right. And Tinder always knew that. Yeah, and this is classic venture capital funding. And you get market share with Tinder, everything. I remember Tinder being free. It still can be free. And then-
AJ:
Wait, Tinder's not free?
Shane:
I think it's free, but most of the things that you want to do on Tinder now require payments. And I was on there earlier this year, earlier in the summer, for a little while, before I met my new, current girlfriend. And it's a lot different. Yeah, I remember paying 50 bucks a month or something. But Tinder is...
AJ:
Back in my-
Shane:
There's a lot of apps, and most of them are owned... Back in my day of-
AJ:
Back in my day, Tinder was free.
Shane:
Yeah. I met my last girl on Tinder. My sister met her husband on Tinder.
AJ:
I love the online dating.
Shane:
Yeah, did you know that Match Group, who owns Tinder, was founded in 1986? It's a 36 year old company. Before the internet.
AJ:
Amazing, amazing.
Shane:
What the hell were they doing back then? Classified ads?
AJ:
Yeah, mail in. Yeah, mail in your ad. Yeah, match.com is wonderful. I think it's a great service. It's like putting science and algorithms behind trying to meet your soulmate. Love it.
Shane:
Yeah, they did $810 million last quarter in revenue.
AJ:
Wow.
Shane:
Wow, that's big.
AJ:
Wow. That's a big pile of matches, isn't it?
Shane:
That's a spicy meatball. All right. Now, the rest of these articles we haven't read, dear listener, so we're just going to riff on them. 529 and charity deadlines... Oh, this isn't an article. The hell? AJ's just slipping in deadlines. What the fuck? All right, okay, PSA, you have a deadline of December 31st.
AJ:
Whoa, whoa, whoa, whoa, whoa. Let's just take back a step, take a step back.
Shane:
What?
AJ:
Yeah, so we have these... Let's talk about what this deadline means. On December 31st, that's our deadline.
Shane:
That's what I was going to do.
AJ:
Okay, go for it.
Shane:
So to contribute to 529s, and to contribute to charity, for the tax year of 2022, so your government... Yeah, so you can't make contributions for 2022 in 2023. So if you're trying to make sure that these deductions show up on your tax return, such as charitable contributions on your Schedule A, of your 10 40... Which you can generally only take if you own a home with a lot of interest on that home being paid throughout the year. Then, yes, your deadline to contribute to charities is December 31st, whether that's cash, or furniture, or comic books, whatever you're contributing. And then if you've got nieces, nephews, sons, daughters, [inaudible 00:06:16], what have you-
AJ:
Yourself.
Shane:
Yourself, yes, good point. That you want to fund their education for, you can do that via tax-advantaged account called a 529 plan. This is if you do live in a state that has income tax. So those of you in Texas, or Tennessee, or Alaska, or New Hampshire, or Washington, you won't get a tax break. But the money will grow tax free in the accounts. Yeah, anything else you want to add, colorwise, color, flavor?
AJ:
I love 529 plans, and I think my favorite, as we're heading into the holidays, thinking about-
Shane:
Are they one of the things that you're thankful for?
AJ:
They are one of the things I'm thankful for. We live in a consumerist, gross society. I love the holiday season. Thanksgiving, to me, is when that season starts. But it does get a little gross with the consumerism, and Black Friday, and all these deals, and you got to buy stuff. And I've always loved the 529 plan. It's like, "Hey, I'd like to send my kids to college at some point." They have this thing called a You Gift code. So if you set up your own 529 plan, they'll actually give you a short link that you can send to your friends and family. And be like, "Hey, this year, instead of getting Billy some Hot Wheels trucks, or whatever you get your 6-year-old, why don't you make a contribution to his 529 plan? Hey, it's a tax deduction for you, Aunt Sue." And Billy gets 40 bucks, 100 bucks, 1,000 bucks in his 529 plan. And that will, potentially, pay for his college.
So I love this idea of intentioned giving, and being thankful for what you have and who you love. As we're heading into Thanksgiving, and end of year financial planning tips, I don't know, I've always loved this idea of... It's like a gift registry. Let's get our families and friends more involved in the good stuff. As opposed to like, "Ugh, I got you this $67 candle." Actually, you can't even find a nice candle for $67, they're $90 now, as I learned last night when I was starting to buy some gifts.
Shane:
Yeah, right on. Yeah, two other things there, if you are, with layoffs coming up on the horizon, if you know someone that gets laid off and they want to go back to school. Instead of making a direct payment directly to the college, they can put it into the 529 plan first, and then make a distribution to the school. Same outcome, except you get a tax break.
AJ:
I'm feeling icky about Black Friday, and all this buying, with inflation so high. And it's, potentially, heading further into a recession. I just started to think about... Our clients have been asking like, "Hey, should we be belt tightening? What are the things we can do to prepare for a recession?" And I was thinking like, "Oh, maybe we could start with the holidays. And let's just spend time together and let that be enough." Let's not all use our Christmas bonuses for buying shit we don't need. Let's use our Christmas bonuses for IRA contributions or 529 contributions. I feel like the fucking Grinch right now.
Shane:
Wait, what do you mean, you feel like the Grinch?
AJ:
I don't know, it's like take away your kids' toys.
Shane:
The Grinch hates Christmas and spending time with people.
AJ:
Right, but that's what I mean. But I mean more like, "Take away your toys and put it in a money account." I feel like... Sorry, Scrooge, not the Grinch, while Christmas hating.
Shane:
No, you are being a nerd, for sure. But, yeah, Black Friday has always been terrible. But it is one of the last connections I had with my mom. My mom's still alive, just so everyone knows. But my mom and I used to go, she would wake me up at 4:00 in the morning to go do Black Friday. And we would go stand outside of a Walmart or a... I don't remember, probably Target or something, and-
AJ:
Circuit City, to get the new TV, to get your laptop. I bet, as a kid, Shane, I bet you were outside that Circuit City at 6:00 AM, trying to get the new Dell laptop because your old one was fried.
Shane:
No, I didn't get a computer until college. But what were the hell... It was probably video game stuff. I was like, "I'll get $10 off of Nintendo," or something, I don't know. Or a sick TV. But, yeah, Black Friday's weird. I haven't done it... People still do it. When was the last time you went to a physical store on Black Friday?
AJ:
Well, a couple years ago, my husband and I decided to... It was the Thanksgiving before we got married, and we decided to go upstate and escape. Well, we actually went to... There was nothing open. Yeah, it was Thanksgiving, so pre-Black Friday. And the only thing open was Walmart.
Shane:
I think I remember this.
AJ:
So we had Thanksgiving dinner in the Walmart, basically. And they were getting ready for Black Friday. They had TVs piled up to the ceiling and aisles roped off. Talking about the economy, Black Friday is typically a banner day for businesses, both big and small. This is when a lot of prices are slashed. Q4 is, potentially, when we're going to, hopefully, recover some of the profits that haven't materialized this year. Didn't Amazon just say that they're slashing their... Didn't they say Christmas is canceled? Did you see that headline from Amazon? They cut their Q4 projections by a little bit. And some journalist was like, "Amazon says, 'Christmas is canceled.'"
Shane:
No, I missed that one. I don't know that one. They did have a bunch of layoffs this week though, didn't they?
AJ:
Yeah. It's a weird time right now. It's getting colder, we're hearing lots of news of layoffs in tech and elsewhere.
Shane:
Yeah. Shall we do our-
AJ:
We got this article here... What, sorry?
Shane:
No, go for it. No, I was going to pull up a visual on the layoffs.
AJ:
Oh. What you got?
Shane:
I'll have to do some scrolling and get... Let me get back to you.
AJ:
Okay. All right, all right. We have this article, "401(k) plans now let workers put retirement money into cryptocurrency." So something that's supposed to be not volatile, like a 401(k), which is supposed to last for a really long time and not make you sweat and not have you watched the balance go up and down. Well, now, you can eradicate all that and you can gamble away your retirement savings by putting them into cryptocurrency. This has been around for a little while. This is not necessarily a brand new thing. I feel like, Shane, we were talking about this a year ago. But it's made its way to the Wall Street Journal, which means it's made its way into the hearts of the American people. I really don't like this. I think cryptocurrency is a really neat technology, and I'm interested to see where it goes in the future. But I do not think that 401(k)s are a place to put alternative assets. I think we should go straight up stocks and bonds and good old boring S&P 500 in our 401(k).
Shane:
Yeah, no, I'm with you there. I don't even think that it's necessary to... Most Americans' 401(k)s, retirement accounts, most Americans are not prepared for retirement. And to introduce something that would make us, very arguably, less prepared for retirement is not my favorite policy decision. There's, obviously, billions of dollars in VC money being dumped into crypto. And trying to open up doors and reduce legislation to make it more accessible. So that those investments do become more valuable, thanks to greater liquidity and greater adoption. At the end of the day, crypto is smaller than the size of Amazon, when you add up all of its market share. So I don't know if this is going to have a huge impact on people's retirement accounts, to play the other side of the coin. But I don't like the idea of something that is only useful from a speculative angle to be a part of people's retirement plan.
AJ:
Seems like a future candidate for bailout by the government. Like, "Oh no, someone sold me an investment I didn't understand, and now I have no money in my retirement account." Well, who's going to pay for that? Probably other taxpayers via the US government, as we've seen before.
Shane:
Yeah. Speaking of struggling in the crypto and bailout space, I have the visual on the layoffs over the past month. We got Meta at 11,000, which was 13% of their workforce. Amazon was just 3% of their workforce, was 10,000 people. Twitter was 50% of their workforce, 4,700 people. Crypto.com, which is the relevancy here, laid off 30% of their workforce, which was 2,000 people. I imagine these numbers are going to go up as the FTX debacle continues to ripple out through the other exchanges. Stripe laid off 14% of its workforce, which is only 1,000 people. Yeah, so this is not getting any better. I don't know, maybe this will save them. Maybe this is exactly what they need.
AJ:
Crypto in the 401(k)s.
Shane:
Finally.
AJ:
Finally. I have a question.
Shane:
Sure.
AJ:
What are you thankful for?
Shane:
Huh, well, we have already talked about online dating, which has introduced me to my last-
AJ:
I'm thankful for 69.
Shane:
Collectively, about four and a half years of relationships. Not always the best at times, but introduced me to people I never would've met before. And opened up really incredible doors for me, that helped me with self realization and growth, for sure. What about you?
AJ:
I am thankful for the ability to travel the world. I'm very thankful for the opportunities I have to do that, both with time and money. And I didn't realize how, during COVID, not being able to do that, I didn't realize how much of a break on my spirit it was. And how confined I felt. And I have the ability to, pretty much, go anywhere I want in the world, at any time, which is such a crazy, big thing to think about. And I think I take that for granted a lot. And I'm just very, very thankful for that ability. I'm thankful for-
Shane:
Where are you heading tomorrow? Let the listeners know your agenda for the next couple of weeks.
AJ:
Well, if you would let me get off this podcast, I could make my flight and go to Italy.
Shane:
Bro, your flight is in four hours. I don't know what to tell you.
AJ:
It's in three and a half hours, and it's at JFK, which is an hour-
Shane:
Am hour from your house. I don't know what to tell you.
AJ:
Listeners, you know what I'm talking about. There's an accident that just happened on the BQE. Anyway, no, I'm very excited. And, I don't know, just thinking big picture, yeah, that ability, I feel very lucky that I can do that.
Shane:
Yeah, building a company like the one that we have built. Every time I meet somebody when I'm abroad... I've been in Mexico for a little while now. They always ask what you do, and I get to explain it, and they're always very jealous. So I am thankful for you for helping me to build this company that we've built, that allows about 30 people to live wherever they want in the world. And be super flexible, and still do really great work, really challenging, deep work. We get people that come from Big Four accounting firms or giant RIAs. And they come here, and they're surprised by our youth and our vibrance.
But, also, the depth of the work that we have, and the quality of the clients that we have. I'm also thankful for our clients for trusting us. We're not even five years old, and we've got a few hundred early adopters that pay us a lot of money to do this great work that we really enjoy doing. That, I think, is making a huge impact on their lives. I bet you're thankful for some of the life planning that we're able to do for our clients.
AJ:
I am thankful for the life, yeah, that was my... How did you know that was my next? Well, I'm thankful for life planning in general.
Shane:
Oh, let's do both of those things, yeah.
AJ:
Life planning, for those who are not familiar, is a school of thought led by a man named George Kinder. And it's a philosophy that financial planning cannot happen if we don't explore happiness and what makes you tick, for lack of a better term. And so Shane and I got life planned about four years ago, literally right before the pandemic, which was a really interesting time to do some soul searching. And the idea with the movement is, what makes you happy? What if you had all the money in the world and no restrictions, what would you do differently in your life? And the answer can be very surprising. And the answer for both Shane and I was surprising, in that it was like, "Oh, we should just do this. We're doing the right thing." We need to make some tweaks in our personal lives, and there's some goals that we need to achieve. But, for the most part, doing financial planning, and running a company that helps others become financially independent, is very fulfilling. And that's right where we're supposed to be.
So I'm grateful for life planning for myself. For our clients, having done this 100 times with various families and individuals, watching a client's face light up after you've told them it's... Well, not told them. You've listened to them and you've repeated their words, just right back to them. To hear them say, "I'm unhappy in my job and I want to go travel the world." And then you can say, "As your financial planner, well, I have great news. You could do that tomorrow. So let's figure out how to do that." And just giving them... They had the answer all along. It was buried somewhere in there. They needed to say it out loud. We repeat it back to them. And then we do a financial plan and we make it happen. And they have that... Once they say it out loud, and once they have a trusted accountability partner, a trusted financial advisor, tell them it's okay, they have that permission. They're buying plane tickets and going on amazing journeys.
So I'm very grateful for how that makes me feel. I'm very grateful that they get to do that. But it's pretty cool to go through that experience, over and over again.
Shane:
Yeah, how often do we get tears on those conversations?
AJ:
75% of the time. It's often.
Shane:
Yeah. I think I'm overdue for a life plan myself.
AJ:
Are you ready? Shall we do it live? All right, let's go.
Shane:
Well, it's every two years, right?
AJ:
Oh, we're way overdue, yeah.
Shane:
Yeah. We were January of 2020. We're coming up on January of '23.
AJ:
Way overdue. You want me to light your torch right now? It is episode 69 after all.
Shane:
We'll cut it in post.
AJ:
Anyways, what else are you thankful for?
Shane:
I was just thinking here about my sisters. And I'm thankful that they're wonderful mothers to my nieces and nephews, who have grown up to become incredible friends of mine, in my adult life, that I look forward to. My nephew came to New York for a week this summer, and I'm planning on... We had an amazing time. I fell back in love with New York City, trying to show it to somebody younger. Going to the museums, and taking him out to eat, and going to parks, and all that, which was really rad. I needed that. I've been in New York 10 years, and it's tough.
AJ:
Over it?
Shane:
Yeah, kind of. So it's helpful to get that spark back again. And then I'm trying to plan something with my niece, maybe internationally, I'm not sure.
AJ:
Oo, fun.
Shane:
His twin sister, yeah. She's a lot boujeer than him, so it might require a passport to impress her.
AJ:
And your boujee concierge over here.
Shane:
Yes. And, dear listeners, the Spanish slang for boujee is fresa, which is strawberry. So if you want to call your business partner, for example, who is muy fresa, that one's on me. I'm thankful for Mexican slang. Anyway, yeah, no, my sisters are amazing.
AJ:
I'm thankful for all the hard work that I put in to be able to be boujee. Thank you very much.
Shane:
All right, all right, all right. They're also mothering my dear-
AJ:
This fresa wasn't built in a day.
Shane:
Exactly, exactly. It's built over 38 years of hard work. Huh, huh?
AJ:
Huh? That's fine.
Shane:
She's not 38, everybody. She's younger than that. Are you not thankful for Blackpink?
AJ:
Sure, I'm thankful for Blackpink. Yeah, look at my Blackpink nails.
Shane:
Oh, shit, fire.
AJ:
Yeah. Yeah, thank you. Blackpink is one of my favorite K-pop bands, who I got to see... I would call it a once in a lifetime experience, this week, in New Jersey. And it was an incredible experience.
Shane:
You know what I'm not thankful for?
AJ:
What?
Shane:
Ticketmaster.
AJ:
Taylor Swift?
Shane:
The worst company that has ever, ever been blessed to merge and create the most vicious monopoly. Up there with fucking the barons of the 1870s. Worst company of all time, dare I say. Give me a worse company than Ticketmaster?
AJ:
I mean-
Shane:
I don't know, some Nazi company.
AJ:
I was going to say, Mercedes-Benz in 1934. Anyways.
Shane:
I didn't know about that until you brought it up. Or was that Ed that brought it up? Our tax manager, that's also Jewish.
AJ:
Oh, you mean the Jews who-
Shane:
Jews in general.
AJ:
... grandparents told them, yeah. We'd never, ever own Mercedes because they were Nazi suppliers during the war.
Shane:
Oh, I didn't know this podcast was going to go down that rabbit hole, did we?
AJ:
Well, it's episode 69. Here we are, folks. You know what else I'm thankful for? Our employees. I had to say this one. But I really am. Every day, I'm just completely blown away, Shane, by the people that work with us. And show up, and do their work, and are interested, and excited. And their enthusiasm is incredibly contagious. And I think they've been through a lot this year at Brooklyn FI, in the market, in general. And their smiling faces just... I was very overwhelmed today saying goodbye to some folks and wishing them a happy Thanksgiving.
Shane:
Yeah. Yeah, you're not going to see them probably until 2023. So I imagine you're feeling like you're missing them already.
AJ:
Yeah, I am missing them already. It was a weird... Yes, I'm excited to unplug, and I very much need a true week off. But I'm also weirdly going to miss that energy. I think, you and I, running a business, there's a lot of... You are needed constantly. You and I, all day long, are getting pulled in so many directions. And we could complain that that's stressful and we don't have enough time. But, at the end of the day, I'm very thankful for being needed and having a purpose.
Shane:
Yeah, that is a blessing. Because the alternative is very dark, very dark indeed, which leads to depression. Yeah, yeah, I'm also thankful for our employees.
AJ:
Well, thanks for listening. I'm just kidding. One more fun thing you're thankful for, before we wrap it up?
Shane:
I'm thankful for America's national parks. No, I'm good, I'm good. I think this is a nice, heartfelt, little, short episode for people's holiday week. If you're celebrating it with family, I hope you're thankful for the people that are in the room with you, or in the room that you've locked them out of. If you're getting some alone time, listening to podcasts, like I always do during holiday breaks... My sister found me in her closet, on the ground, with the lights off, one time during Christmas. It's like, "What's up?" "Getting some alone time."
AJ:
I feel like we also call each other a lot, when we're home with our families. We're like, "Oh, I got a business meeting with my business partner." I'm like, "What's up?" And you're like, "I just need to talk for a little bit."
Shane:
Yeah. Well, big shifts in the people you surround yourself with are really tough. And suddenly becoming so vulnerable and being so out of your typical element. You're probably not in your New York City apartment, but out at some family member's apartment, or giant house in the suburbs that you don't know where the light switches are. And you don't have your own room or whatever the hell it is. It's an adjustment.
AJ:
And you're sleeping in a twin sized bed, for sure.
Shane:
Your autonomy has been truncated, for sure.
AJ:
Indeed.
Shane:
Yeah, we're right there with you, listener. So thankful for you for listening.
AJ:
Well, it's 420 on episode 69, so I'm going to have to call it. And say, thank you, folks, for being awesome listeners. We're grateful. I'm thankful for all of you for listening to The Liquidity Event. Hope you had a great Thanksgiving. We'll see you next week.
Shane:
Take care.
AJ:
Bye.
Speaker 1:
Thanks for listening to The Liquidity Event, hosted by AJ and Shane of Brooklyn FI. Head on over to brooklynfi.com, where you can subscribe to the podcast or YouTube channel. Or if you want to learn about their full service financial planning, tax, and investment firm, specializing in tech professionals and creatives on the path to financial independence. We'll see you next time on The Liquidity Event.