The Liquidity Event Podcast: Episode 83

 

Episode 83: Breaking News: Business Owners Surprised at How Easy it is to Make Money Struggle to do Basic Business Things

On this episode of the Liquidity Event podcast, we cover Amazon's $3.49 billion deal for One Medical and why we are surprisingly excited about it. AJ asks our listeners to vote on the next book she reads, so don’t let her down. In other news, companies tested a four-day workweek and decided they don't want to stop, proving that work-life balance is a myth and we just thought you should know that Delta AmEx cards offer a permanent 15% off on travel booked with miles. We learn why emojis count as financial advice and ponder the impossible question of how to make accounting cool.

And finally, we have a New York Times whine-fest of digital creators owing taxes after going viral, proving once again that money can't buy freedom.

Read the Full Transcript:

Presenter:

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, SPACs, founder wins and fails, crypto, and whatever else these nerds think is interesting. Learn more and subscribe today at brooklynfi.com.

Shane:

Hello, hello, hello, and welcome to The Liquidity Event. We are your hosts Shane Mason...

AJ:

And I'm AJ.

Shane:

And this is Episode 83 of The Liquidity Event, coming to you on March 3rd, 2023. AJ, it's March. Just like that.

AJ:

Happy March.

Shane:

Out of nowhere. It's March.

AJ:

The Ides of March are coming soon. Thanks so much for joining us on today's program. As you can tell from my new microphone cover... What are these called? Pop filters? For those of you tuning in via audio and not video, I have a snazzy BBC 4 radio pop filter because my pop filter escaped my bag on an airplane, so it was lost.

Shane:

Oh no, did it fall off-

AJ:

Yeah, I was-

Shane:

the built-in one?

AJ:

I was James Bonding it back from Palm Springs with no luggage because I hurt my back, and I stuffed all the important items into a little purse, which were: my laptop and my podcast microphone and my favorite lipstick. So I borrowed my husband, who does a lot more impressive podcasts than I do, so I stole his BBC 4 mic cover.

Shane:

Very cool. Very cool. Very cool. I left my Kindle on a Delta flight about two months ago and they just let me know that they found it.

AJ:

Really?

Shane:

So another good reason to-

AJ:

Oh, we've got some-

Shane:

Now I have two Kindles, if you need one.

AJ:

Oh, actually I do need one.

Shane:

Yeah.

AJ:

I'm back on the ebook train. We have some Delta wins to talk about later, as well.

Shane:

That's true. That's true. On this week's episode of The Liquidity Event, we have Amazon purchase of One Medical. We've got a lot of antitrust stuff going on. We're going to try to convince you guys that accounting can be cool. And then, TikTok and taxes are all up in. It's tax season, y'all. It's a phish tax season, so a great episode today. AJ, your name on today's episode is "Fuck Spectrum" and you're coming to me from an iPhone. What's that all about? What's going on there?

AJ:

Yeah. I live in Clinton Hill in Brooklyn, and my internet right now is about the speed it was in 1994 when I was going to the Beanie Babies websites and you would see the page loading one at a time, and I was trying to look up the value of my Princess Diana Beanie Baby. That's what I'm experiencing right now. Actually, going to our website-

Shane:

The original Bitcoin?

AJ:

Yeah, exactly.

Shane:

Do you remember when you could choose between... It would come in all at once, but grainy? Like pixelated.

AJ:

Yes.

Shane:

Or you had to wait for it to load the top 20%, second 40%, next 60%-

AJ:

Yes.

Shane:

...at pristine... Yeah. What kind of person were you? Were you grainy or 20, 40, 60, 80, 100?

AJ:

Oh, I was 20, 40, 60, 80 obviously. Only psychos would want grainy stuff. Yeah, it's very frustrating to not have internet. It's one of the last frontiers of problems you can't fix with, I don't know, an app. We've solved transportation, food delivery, medical delivery, which we'll talk about, prescriptions. I can do so many things, but I can't do anything because my internet sucks.

Shane:

We've come so far.

AJ:

I can't take a break and watch TV. Yeah, it's very frustrating.

Shane:

We've come so far. You know me, man. I want to throw a Starlink on every roof and just pipe it down as a backup.

AJ:

Geez.

Shane:

I don't know why we can't do that. I was watching Instagram and they rolled out a new Starlink that you can throw on a sailboat. If it works in the middle of the ocean, it'll work on your Brooklyn rooftop.

AJ:

Really?

Shane:

Yeah, man, it's pretty nuts. Your boat will be bobbing around and it can still pick up signal. It works on RVs and everything.

AJ:

Sick.

Shane:

You know my standing for stars.

AJ:

Speaking of bobbing around, I finally finished the goddamn Three-Body Problem, the book that I've been reading for two months.

Shane:

Oh, we're not in the book club anymore. You're done.

AJ:

I finally finished it. You're still going?

Shane:

I put it down to read all seven Harry Potters in a row, and I'm three-quarters of the way through book three. I'll pick it back up after I'm done with the Potter boy.

AJ:

All right. Favorite professor at Hogwarts quickly. Go.

Shane:

Well, I'm only through three books. So

AJ:

You've met all the professors at this point, except the Defense Against the Dark Arts professors. But you've met most of them.

Shane:

Lupin is the new one, and I like him a lot. He's the Defense Against the Dark Arts professor. But he's probably not my favorite. I have a feeling McGonagall's going to be... Or Snape.

AJ:

I feel like are Lupin.

Shane:

Oh yeah.

AJ:

Oh my God, you are Lupin.

Shane:

Tight.

AJ:

Oh my God.

Shane:

Shabby clothes. Good at his job. Moving on. Let's get into the podcast.

AJ:

Disappears at the full moon. Wait, wait, wait. I know you don't like surprises, but I have a surprise.

Shane:

Oh.

AJ:

It's not that big of a surprise.

Shane:

Wait, I like surprises.

AJ:

You don't like when I do surprises on the podcast. You're like, "Where are you going, AJ?"

Shane:

Oh. Well, yeah, I don't like when we have a plan and then you go off the rails, but what is this?

AJ:

Right, right, right. Okay. Now, my plan is: Okay, so I just finished this book, and I don't know why it was so hard for me to go through it. I was reading it for two months. So I want to have an interactive podcast. Obviously this is not live. But I want our readers to vote on what I should read next. So the two books that I've picked from my huge stack next to my bed that I'm not going to get through are: The First Tycoon, which is-

Shane:

AJ's holding up two huge books to the screen.

AJ:

Big books.

Shane:

Yeah.

AJ:

Love big books.

Shane:

Yep.

AJ:

I've got big books and I cannot lie. The First Tycoon, which is The Epic Life of Cornelius Vanderbilt by TJ Stiles. How many pages we got here?

Shane:

Big fan of that one.

AJ:

Eh, let's call it 560. Won the Pulitzer Prize, so this is going to be good, right? It's going to be a biography of... It's not just of the man. It's of the city. New York City, right?

Shane:

Hard to follow.

AJ:

So that's our non-fiction. And then, we have Harlem Shuffle by Colson Whitehead, who is one of my favorite authors. So this is going to be fiction, and I believe it's also about New York City. It's got music and the Harlem Renaissance, so I'm kind of into this one, too. So what should I read next, dear listeners?

Shane:

Great question.

AJ:

Let us know.

Shane:

Great question.

AJ:

Speaking of listeners, also a new segment that I want to throw out there, which is a listener shout out. So this week I want to give a personal shout out to our bud Eric Rodriguez for being a cool dude. He's a newer friend of ours. I'm told he's an excellent golfer and he is a Liquidity Event stan. So shout out to you, Eric. Thanks for being such a great dude and listening to the pod. All right, let's stop yammering and get into some articles. So Amazon says-

Shane:

We have a lot of articles. Yeah.

AJ:

I know, I know, I know. Yeah, we might have to rapid-fire through some of these headlines, because a lot of these are just like... We got to talk about it. But this first one, Amazon says it has completed a three-and-a-half billion dollar acquisition of One Medical. Have you ever been to a One Medical?

Shane:

I have not yet. I did a lot of research on this and I'm excited about it. What are your thoughts on the acquisition or the product?

AJ:

I'm not familiar with the product personally, but I've also read a lot about it. Very intrigued by anything that can fix healthcare or is attempting to fix healthcare. The US is a very large company with a lot... A large company. Large country with a lot of unhealthy people, so the current healthcare system is super broken. So whatever we can throw at the problem to see what works, I am basically in favor of. So Amazon has fixed shipping and fixed home delivery through their mastery of logistics, so let's see how they do in the healthcare space.

Just for those who are not familiar with One Medical, they are physical... Sort of like an Urgent Care, if you've ever been to one of those, except this is for your primary care physician. So instead of going to a doctor through your insurance that you have to find, you just walk into a One Medical and say, "Hey, I need my annual physical," or some medicine to get rid of your flu, or give you some stitches. Whatever you need there. And Amazon just bought them for their network, for their footprints, for their tech. I have a feeling there's a lot of tech involved in One Medical's success and patient processing. I think one of the biggest costs in the healthcare industry is accounting and bureaucracy and paperwork, so if they can eliminate that, that's a big win. So I am in favor of this acquisition. There's not going to be an antitrust challenge here, so that's cool. What about you, Shane?

Shane:

Yeah, I'm on the same page. The announcement I think was in September-ish that they were going to buy it, and FTC's decided not to challenge it. Yeah, I didn't really look into One Medical, I'm kind of embarrassed, until that Amazon decided to buy it. I'm excited for them to enter the space. A lot of predictions that they would get into medical eventually. I mean, it is a multi-trillion-dollar business, and at the size that Amazon is, it has to have a huge target market in order to do big acquisitions. Otherwise, it's just not worth the time and energy. I went to the website. There's a funny hassle-free primary care comparison between One Medical and a typical primary care practice. Apparently, it's 24/7 virtual care, which is great for someone like me that's always moving around, sometimes out of the country. These days, I'm just paying Mexicans cash to take care of me in person. What's up?

AJ:

Quick note there though: Because of certain privacy laws, I've noticed that when I'm out of the country, sometimes you actually can't log into certain video chat or medical apps. I log into NYU's MyChart, and you literally can't log in overseas. So just watch out for that before you sign up. Pro tip.

Shane:

Yeah. Or get a VPN for $0 a year.

AJ:

Sure.

Shane:

Yeah. Come on. Come on. Get a little VPN situation. Express VPN's really good. We're big fans of that one. Appointments start on time, which I feel like is super low-hanging fruit for a comparison to a primary care physician.

AJ:

As-

Shane:

Yeah. You've been going to the doctor a lot lately.

AJ:

Yeah. I go to the doctor all the time, and yesterday they squeezed me in because I had an emergency, and I waited for 45 minutes, which is fine. They squeezed me in. I was appreciative. But, yeah, going to the doctor is an ordeal, so if they can make it easier. And most people don't need to go to the doctor, right? They just need a check-up. How's my vitamin B12 levels? Do I have cancer? Et cetera. Like I said, this is trying to solve this huge insurance problem of the people who are generally healthy and just want to make sure they're okay, it's cheap to service those people. My fear here though is that this does take away potentially from... And by the way, this does not replace insurance, right? They do take insurance, so you can use your insurance premium to pay for this. It's just a better way to have access to doctors so we can leave the physicians to that sort of high-level, "Let's cure diseases. Not give someone a prescription for cough medicine."

Shane:

Yeah, I mean speaking of that, the last two things: As long as I'm not receiving bills in the fucking mail anymore, I'll pay the $200 a year for the One Medical app. That apparently is one of the benefits. Also, they have onsite labs, which is another thing that drives me crazy is when you go to the doctor and they're like, "Oh, yeah, we need to send you to the lab," which is six boroughs away. And you go all the way there, and that's another two hours of waiting to get your blood drawn. And then, you got to wait four weeks, and then it's another bill in the mail that goes to God knows where before it shows up on your credit report. So, yeah, I mean, this industry's ripe for disruption. I'm excited to see Amazon take this at scale.

AJ:

For sure. To pull a page out of Sesame Street's handbook: Speaking of the number four, after testing it in the UK, companies are potentially excited about moving to a four-day work week. So about a year ago, we heard about this study that was commencing. It was, what, 61 businesses in the UK, AKA England, who are going to try out this four-day work week.

Shane:

Say that to some Scottish or Irish people.

AJ:

No, this British. It's 61 British businesses.

Shane:

AKA England.

AJ:

Clarifying that it was in the British Isles. Anyway, it was 61 businesses and, what, 2,900 workers, and they tried it out. And essentially, the results were pretty positive, right? 46% of the companies in the trials said their business productivity had remained about the same, 34% reported a slight improvement, and 15% reported a significant improvement. They did this STU study from June through November, and my complaint is that they didn't do this through the winter, AKA seasonal effect disorder season, where productivity slumps and people don't want to go to work because they're sad because the weather sucks. So I think they needed to continue the study to have some real data, in my opinion.

Shane:

Yeah. Yeah, yeah, yeah. That's a great point. I didn't pick up on that. I mean, one thing I did pick up on is that this is, yes, in the UK, which is notably very different from the United States work culture. With that said, I looked at our changes in productivity historically. Because the idea here is that people are the threat to business owners. Are people going to be as productive? And just thinking about productivity, I looked at our productivity as compared to wages historically, and apparently ever since 1979, 1980... I'm not sure what caused this. Maybe it was the merger and acquisition or the hostile takeover area of the 1980s that we experienced, but we have seen a 4X increase in productivity compared to wages.

So, essentially, you're getting paid for Monday for the work you did Monday through Thursday. So I don't know, in my opinion, I think maybe we should be paying people. Giving them one day off per year might help change that gap in terms of productivity versus compensation. BKFI is experimenting with this in July. We're going to four-day work weeks. We have expanded time off in the summertime. But anything else you want to say about-

AJ:

Here's what I want to say about this. In the space we're in, in financial planning and wealth management and tax, for wealth managers, this is probably fairly easy to implement. Right? You let your clients know, "We're going into a four-day work week." You probably have someone on rotation for emergencies so there's always someone a client can reach. But for tax firms, I think the accounting industry, which we'll talk about later, is going to be very slow to adopt this and even think about this. So I imagine the big four accounting firms doing the Spider-Man pointing fingers at each other like, "You should do it. No, you should do it." So is Brooklyn FI going to going to have to be the first accounting firm to move to a four-day work week to set the industry trend? That's my prediction.

Shane:

Yeah.

AJ:

Something that we are certainly [inaudible 00:14:31].

Shane:

We could talk about that for next 20 minutes. Yeah.

AJ:

Yeah.

Shane:

We'll circle back to it in a bit. Speaking of circling back, the Department of Justice has circled back to the Adobe acquisition of Figma and decided that there is going to be a problem. It's a bit of a problematic acquisition. I'm not as familiar with these... I'm very familiar with-

AJ:

That's a good rap name.

Shane:

... Adobe. "Problematic Acquisition?"

AJ:

I'm Problematic Acquisition.

Shane:

I'm the problem. It's me.

AJ:

Here to tell you about your concentrated position.

Shane:

Nice. Keep going.

AJ:

I'm good.

Shane:

This is a cipher you got going here. The deal was announced in September, so maybe that's what I was thinking about when I said that about One Medical. But it's just surprising to me how long these acquisitions take. I guess the ruling bodies or the antitrust bodies of various jurisdictions need to take a look, and it looks like the US and Europe are not stoked about Adobe's snatching up of Figma at $20 billion. It's been compared to Facebook's acquisition of Instagram, a startup that was going to be competing. Of course, it was one-twentieth the size. The only billion-dollar paycheck going out is to the CEO of Figma. Congrats for building the startup.

AJ:

Congrats.

Shane:

I haven't used Figma very much. I've used a lot of Photoshop. It is incredibly difficult to use. I had to figure out how to make fake IDs in high school. Let me tell you, it took a while. AJ, what are your thoughts on Figma? I know you use it-

AJ:

I use it quite a bit.

Shane:

... routinely for our software.

AJ:

Yeah. And I'm not a designer, so I find it frustrating, but 10 times easier to use than Photoshop. And for collaborating from a non-designer collaborating with a designer, it's incredible. Our designer makes a change. Makes a comment. I come in. I say, "Eh, I don't like this. Remove the dollar sign." Whatever I want to say. I love the tool. So the argument here is that this takes away competition, because Adobe had their own product that was similar for this type of non-professional collaboration called XD, which I've heard from designers is just not very good. It just wasn't as good as Figma. And I didn't realize this, but Adobe has been trying to buy Figma since 2020. They've tried three other times and finally succeeded in 2022. So they have known that this is something that they need to compete in this space. I guess this lawsuit is around, "This isn't even competition. They're just squashing out all other competitors."

Shane:

Yeah, yeah. Which I guess is the complaint, right? Because Adobe owns the high-end space and ow they're purchasing the low-end space so there's not really anything left. I mean, this is bad for you and I on an anecdotal scale. We'll just have to pay more for Figma and Adobe, whereas Microsoft had taken... Apparently, they solicited Microsoft to make the acquisition. That would've been great for us, because we're big users of Microsoft.

AJ:

Already pay out the wazoo for Microsoft anyway.

Shane:

Yeah. Maybe that would've been a built-in tool for us, but apparently not. Or maybe it will, because the EU and the US are challenging the deal. So maybe it won't go through, which would be such a bummer for the billion-dollar payout to the CEO and all the rest of the employees.

AJ:

For sure.

Shane:

Speaking of bummers, being an accountant is a bummer according to the Wall Street Journal puff piece.

AJ:

According to the Boomers of the Wall Street Journal. Oh my God, this article made me so... The article's called "How Can We Make Accounting Cool?" And the illustration is of a cool guy, AKA a guy with a Mohawk, sitting at his desk doing some accounting.

Shane:

Don't forget his sleeves and his nose ring.

AJ:

Yeah. Honestly, I think you should be offended, Shane. You're the cool accountant. When I first heard about the idea of Shane Mason when Brooklyn FI was barely a twinkle in your eye, you were introduced to me as "the cool accountant." So I'm honestly offended that we were not consulted for this piece. That's all I can say.

Shane:

Thank you for saying that. I judge my coolness based on if my nieces and nephews find me cool. I'm doing well. My niece is coming down for a Tame Impala show next weekend, down to Mexico City, so I'm going to get a lot of cool points. To be fair, yes, I am offended by this. But I'm more bummed out that 75% of CPAs hit retirement age in 2020, and CPA exam attendance is down 40% over the past 10 years; so we've got people dropping out of the industry and no one coming into it. I could talk about this a long time. I'm going to keep it simple. You don't get paid enough to be an accountant. There is a social stigma. And when I say you don't get paid enough, you have to get a master's degree to get a CPA, and then you get paid less than an investment banker or a tech employee.

So it's just got a comparison problem. It used to be the days where it was a super steady job that had a really good salary and a lot of respect, and we're losing a lot of that. Half of accounting is being an auditor, which is essentially a narc. And the other half of accounting is being a tax CPA. That industry is fucked because the big four don't know how to change and update because there's too many partners in these big firms that can't make decisions to get away from the tax busy season they have that burns people out and churns them. I won't go on and on about that anymore.

AJ:

I got a hot take for you.

Shane:

Go for it. Hit me.

AJ:

I got a hot take for you. All right, so based on what you just said, there's really two arms of accounting. There's auditing and big corporations that are public that need teams of people. And then, there's every small business and every individual who needs their taxes done. So I think you should split up the accounting industry into two, which is personal and small businesses, and then public corporations. And they're just completely separate, and I think that will help a little bit with the rebranding of accountants. So it's like we can have the respectful professionals who come in and fix these companies who probably get more equity. They're treated more like engineers rather than accountants in the back room. And then, we have the tax professionals who help the individuals in small businesses who are more like financial advisors. So I that's how we bring up the perception of the industry. Also, remember the film Legally Blonde? Reese Witherspoon?

Shane:

Of course. Yeah. Snap.

AJ:

Right. Yeah. "Bend and snap"? Of course.

Shane:

"Bend and snap." Yeah.

AJ:

I'm sure you've fallen for it many times. I've used it many times. Works every time. So we need an HBO show about accountants, because when Legally Blonde came out... There's some statistic I saw a million years ago, I don't have it off the top of my head, where it's like when Legally Blonde came out, law school admissions went way up for women. So it's like, let's have a cool show about accountants. There's a bunch of movies, but they're always portrayed through the stereotype, so we need a cool reality show or a White Lotus-type thing where the focus is on accountants. That's my take.

Shane:

That would be huge. That would be huge.

AJ:

So how do we make accounting cool? We could have literally a whole podcast about how to make accounting cool; and we probably should, honestly, based on this article.

Shane:

Speaking of cool things having big implications, looks like emojis can be ruled as financial advice according to a federal judge. Some people were posting emojis, the rocket ship emoji, the stock market up and to the right emoji, and the money bags emoji are now potentially financial advice, which carries a lot of legal liability associated with it. Just ask Kim Kardashian and Matt Damon and all the other folks that were sued for crypto recommendations over the past two, three years. Ask Larry David, Mr. FTX. Which I don't think he was being sued for. I think that was purely a commercial, but also very funny.

AJ:

No, that was a, "This didn't age well." Yeah.

Shane:

Yeah, just not really good for the brand really. What do you think, AJ? What does the Tax Bimbo or the Finfluencer in you... What do you have to say about-

AJ:

I think this is fine. I mean, I read this as a judge trying to do something to protect consumers from scams.

Shane:

Mm-hmm.

AJ:

Right? And if you see a tweet and you're an uneducated consumer that says, "Buy these NFTs," and you see an emoji, which is what you can connect with because you're not educated in the personal finance space, you're going, "Oh, this is cool. Let me click on this." So, I mean, is this going to be effective? No. This is in the article. It's like, the crypto community's just going to find other emojis to indicate success.

Shane:

Emojis. Yeah.

AJ:

So, the fact that this is very specifically about these three emojis is kind of headline-grabby, but I think the suit itself is meant to be like... Look, the SEC does shit like this all the time. They take certain cases to make examples out of things. So is this case going to have massive implications for SEC regulation of financial advice on TikTok? No. Does it get attention for these communities to say, "Hey, maybe individuals should do a little bit more due diligence rather than clicking on something and signing up because they saw a rocket ship emoji"?

Shane:

Yeah. I mean, I think that it's very hard to tell who gets paid to provide advice versus people that are shoving products down your throat, and we need some differentiation around that. I think that in the same way that the AICPA, or the American Institute of CPAs, is fucking up the pipeline for CPAs by making it too hard to become a CPA, I think the CFP board is making it too easy to be a CFP because you can be a CFP and sells stuff like this and not just get paid for advice and be pushing insurance and be pushing crypto and stuff. Whereas, if there was a badge that said, "I only get paid by you." So if I make a recommendation, or if I talk about it on TikTok, or if I talk about it on Instagram, you can rest assured that I am somebody that only gets paid by you, the consumer, and I have no ulterior motive. And we can get some clearer advice as opposed to this TikTok bullshit that could potentially sell a bunch of snake oil.

AJ:

It's very harmful. Yeah.

Shane:

It is harmful. Yes.

AJ:

Yeah.

Shane:

Unfortunately.

AJ:

It's the fiduciary standard, right? It's your interest versus the people that you're trying to serve, right? Yes, we're giving advice. Yes, we're charging for that advice. But we do not get paid through third parties, and that's the biggest thing. It's like, "Of course I'm going to show your product because you paid me $20,000 to talk about it. I will happily recommend..." Whatever. You said something earlier that was... We drop product recommendations all the time on this podcast. We don't have sponsors. We might have some sponsors in the future, but it's because we use this shit. We use Figma. We use [inaudible 00:24:13]. These are tools.

Shane:

I mean, we just raved about One Medical and we haven't even used you yet.

AJ:

One Medical. Thank you. Yeah.

Shane:

And we're going to rave about Delta later. We're not getting paid by any of these people.

AJ:

I mean, if Delta doesn't sponsor me by the end of 2024, I'm going to throw a fit.

Shane:

I know.

AJ:

Speaking of getting sponsored and being paid to talk about products, we've-

Shane:

[inaudible 00:24:35].

AJ:

... got an article from New York Times... That was a good one. That was a soft, little, easy softball segue there.

Shane:

Yeah. That was a layup.

AJ:

They went viral and made money, now they own taxes. This is a, "Wah, wah, life is hard," article from the New York Times around tax season. It's about influencers on these various social media platforms who have made a bunch of money from these endorsement deals and advertising, and now they are surprised that they owe taxes on that money. And I feel for them, right? I mean, what business-owner in their first year of being a business-owner hasn't fucked up their taxes. Right? It's a surprise. You're making a transition from someone else doing it for you, AKA your employer withholding it from your paycheck, to it being your problem. So I get it. I get this sort of first time thing, but this is like world's smallest violin, and I know that you have similar thoughts.

Shane:

Oh yeah, I could dig in. I mean, as somebody that has dealt with first-time business-owners many, many times, I just don't have a ton of sympathy. I mean, let me change the name of this piece here for you, all right? "Business-owners surprised how easy it is to make money. Have to do basic business things." All right? This one influencer who has 7,000 followers says, "I'm walking through a minefield. I figured out what I'm supposed to do." They said, "I only have around 7,000 followers and I don't make a ton of income through Instagram, but if you make money, you have to report it."

Literal quote. This is classic catastrophizing by people that have no resilience. If you're going to fuck up and accidentally owe money, figure out how taxes work as a business owner. It's great that you're figuring it out when you're 19 or 23 or 25 as opposed to your late thirties and you've just quit your job and you have kids to feed. This is a great thing. You made a bunch of money. You're on TikTok as an influencer. There's plenty of CPAs out there that can help you. But, yes, every tax season, the time is in the journal. Come up with great, little... I've been in these tax... You remember when I was on national TV for being a silly tax person? I mean, this is the same situation.

AJ:

Of course. You and I literally met on a podcast where I interviewed you about this situation because I was getting a lot of questions on my old podcast, Moneysplained, about that. And you can listen to the first hour of Shane and I ever meeting, and I'm asking Shane, the cool tax accountant, "What should you do as a freelancer? What can you do to avoid this freaking problem?" Wow, where did that come from? When have you ever heard me say "freaking" in five years of working together?

Shane:

I don't know. Yeah, that was weird. I'm just not even listening to anything you say besides, "Shane's a cool tax accountant."

AJ:

[inaudible 00:26:54].

Shane:

Anyway, moving on to the next article. People that actually have problems in California.

AJ:

Real catastrophes.

Shane:

Real catastrophes.

AJ:

Seriously shout out and our hearts go out to folks who are experiencing their homes being destroyed or their stuff being destroyed, displaced. That's very disruptive. So the IRS is cutting these folks a break due to the mud slides and weather patterns in California. Go to the IRS website. You might have a deadline extension if you are in one of these impacted counties. Unfortunately, my county, Riverside, was not on the list, but my mom, who's near Santa Barbara, she's actually on the list. And her roof was all fucked up, so she's getting a little bit of a nice tax extension, which is great. You have more time. You're busy. You're busy fixing your life. Don't maybe necessarily have time to file your 1040.

Shane:

Yeah.

AJ:

That's good.

Shane:

LA County, San Francisco, Mariposa, Marin, Santa Cruz, San Diego. Not every county, so you got to look it up, but a lot of the ones in California. Humboldt. Even as north as Humboldt.

AJ:

And once again, speaking of making accounting cool, let's not shit on the IRS. They're pretty good about this stuff. They're listening to lawmakers and saying, "Yeah, we get it. We'll give you more time to follow your taxes. No problem." Shout out to the IRS for doing this.

Shane:

And part of being able to deal with that is the $80 billion that we give them for administrative costs. So if they didn't have that money, they wouldn't be able to deal with various deadlines, et cetera. Anyway, we don't have a ton of time and we've got Stripe. You want to dig in? You want to quick-fire, double-trigger RSUs?

AJ:

Yeah, quick-fire. Do me. Give me the quick-fire of the RSUs.

Shane:

Oh, you want me to do it?

AJ:

Or do you want me to it? All right. But I feel like we've talked about this ad nauseum, but basically they're looking at investment banks to get them funding. These investment banks are taking out those... They're giving those opportunities to their wealthy clients to allow other clients to actually invest in this potential getting in at Stripe, which allows employees liquidity to get money out for their RSUs, and it allows Stripe to pay this big employment tax bill on these RSUs as they best. We definitely don't have time to talk about this. I feel like we're rushing through this.

Shane:

It's fine. I mean, I don't think there's much more to it. I think that it's struggling to get the prices they want from VCs, and Goldman Sachs is even bringing in retail investors, or wealthy retail investors, because it's just not inspiring to say, "Hey, we need 4 billion to pay our employees' social security tax bill so that we can keep them around." And it seems like there's blood in the water and these investors are saying, "We're not even going to take your $65 billion valuation. We need a lower valuation of $40 billion." Because when it comes to return on investment, most of the return is dependent upon the level of investment. So if they can get a low price, then they're going to get a good ROI. I don't blame them. And it's bad management by Stripe to not have gone public in 2021 and now they've got to deal with the consequences.

AJ:

Exactly. All right, last little 15 seconds. Delta AMEX now gives a 15% permanent discount on award travel. So if you book your Delta Awards travel with miles, you pay 15% from that listed miles price, so that's going to be great for Delta AMEX holders. We love to talk about credit card rewards because they're awesome and it's a game, and we like to win the credit card game.

Shane:

All right, that's it for this week, ladies and gentlemen. To vote on AJ's book, please just email her directly, AJ@brooklynfi.com. Show notes are available at brooklynfi.com/episode83. BKFI stans can leave us a review if you want to be weird about it. Please do, folks. Thank you.

AJ:

Goodbye.

Presenter:

Thanks for listening to The Liquidity Event, posted 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.