High Property Taxes Pushing Many New Yorkers to Relocate

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Recently I posted a report that the number of wealthy individuals leaving Connecticut for more tax-friendly pastures has been increasing. It seems that Connecticut isn’t the only state that is facing this problem. According to a report in the Democrat and Chronicle, New York is also dealing with more people leaving due to high taxes; and it’s not just the wealthy.

Reportedly, 41 out of 50 upstate counties in New York saw their populations decrease between 2010 and 2015. The mass exodus it seems appears to be closely related to New York’s disproportionally high property taxes. One woman from New York, who moved to neighboring Pennsylvania, now enjoys a 60 percent decrease in her property tax bill. It dropped from $5,000 annually to just $2,000.

Despite the spin that some government officials are trying to put on the numbers, the fact is that between 2009 and 2014 the state took a hit of $22 billion in wealth, with $11 billion coming between 2012 and 2014. According to financial advisors, even though it’s a tough decision, for many the taxes savings are just too much to pass up. Combined with a slow economy the high property and income taxes leave many residents with no choice but to pack up for greener pastures.

Even many of the state’s retirees are starting to worry more about New York’s high property taxes, with 56 percent saying they are concerned about being able to pay these taxes in retirement, according to a report from the AARP. In fact, 55 percent of baby boomers reportedly said they fully expect that they will leave New York when they retire, and 66 percent of the Gen-X population said they are also considering doing the same.

http://www.democratandchronicle.com/story/news/local/2016/05/11/new-yorkers-leave-states-lower-taxes/84212658/

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How to Create a Common Dream

dreams [Converted]

All companies are out to achieve successSuccess can be defined in many different ways, but in most cases companies define success by their results. Many companies have mission statements, common dreams – or goals – that they use to motivate their workforce or to define their purpose. These statements are also often used to define success. Mission statements can be a valuable tool to help keep everyone within the company focused on the goal or purpose of a company. They can be the common purpose that everyone shares that will be the steadying reminder of the desired end result. However, are these mission statements or definitions of success really a common dream? What’s more, is there really even such a thing as a common dream?

Developing a Common Dream Together

I asked Joel Peterson, Chairman of JetBlue and the Founder of Peterson Partners, his take on common dreams. Joel has spent many hours speaking and writing about trust and integrity, including authoring the book “The 10 Laws of Trust.” Joel started by telling me that people have a hard time trusting something or someone if they don’t know what the goal is. “A lot of companies will actually create these mission statements…that are kind of interchangeable.” These kinds of statements aren’t really a common dream at all, according to Joel. In reality they just sound good. “People want to frame them and put them up on a wall.” However, “if you develop a common dream together that inspires people – which gets back to the idea that people want to be a respected member of a winning team doing something meaningful – you can develop a mission around that and you’ll have people that you can’t stop.”

Helping Others Achieve Their Dreams

I also asked Joel the difference between a common vision and a common dream? I pointed out that a common dream really gives a better visual of trying to make something happen that does not currently exist. Joel said that the mission at Peterson Partners is to help entrepreneurs achieve their dreams. Entrepreneurs have big dreams and they want to change the world. They want to do something that no one else has done before so they think very big. Therefore, “we view our role as capital providers as people who provide help to them, to help them achieve their dreams; and that becomes our dream.”

Coming Together for a Common Purpose

A common dream is not a mission statement or a company mantra placed on bulletin boards throughout an office building. A common dream is created when people or companies come together with a vision and a common goal and then work together to achieve that mission or goal. Having a true common dream can go a long ways in helping all parties involved achieve the mission, or results, they are seeking. That can be a powerful driving force on the path to the success.

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Succeeding Against All Odds

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Just about every startup business or entrepreneur faces tough odds, which at certain points can seem almost insurmountable. Achieving success is always gratifying, but when you achieve success against all odds, that satisfaction can feel even greater. Being able to overcome huge odds and obstacles is never easy, but many people have what it takes to keep pushing against those odds and eventually beating them. I recently spent some time visiting with one such person, who overcame great odds and helped Oracle become a huge success in the software industry. Noosheen Hashemi was a recent college graduate when she joined Oracle back in the 1980s. However, it didn’t take her long to establish herself as one of the company’s most valuable assets, despite her youth and inexperience.

Noosheen Hashemi

Currently Noosheen serves as the President of H.A.N.D. Foundation. She is also an Advisor at Atheer Labs, Inc. and is a Philanthropist with a passion for entrepreneurship and economic development. Noosheen is also an independent angel investor and advisor in the software industry. As mentioned, she also played a big a role in the successful turnaround of Oracle, where she worked and held various management positions between 1985 and 1995. Noosheen took an active part in the company’s rise in the industry. She was appointed Director of Finance and Administration in 1988 and named Vice President in 1990. She also led the expansion of Oracle services as VP of Marketing and Business Development for Oracle’s Worldwide Education, and in 1991, she won Oracle’s “Against All Odds Award.”

Keys to Achieving Success

So justhow did Noonsheen overcome the odds and all the competing goals of the company in order to become successful? She explained to me that at one point she was running 12 departments at the same time. She worked 18 hour-days, seven days a week for seven years and even pulled all-nighters, where she would work till 5:00 am then be back at 8:00 am for her next round of meetings. So how did she balance all these responsibilities? “It was intuition.” It was also some very basic things, which included “always serve in the best interest of the company above all else. So the loyalties were always to Oracle and not to any one person. It was always in service of efficiency and constant, continuous process improvement. It was always to be ethical, proper and then you add a lot of hard work.”

Testing Your Limits

Noosheen said it was a lot of intuition and you just knew what you had to do. Oracle was a great place to work because they put a lot of trust in young people to figure it out. They didn’t sit you down and explain how it had to be done, they gave you the assignment then trusted you to figure it out on your own. “As the company tested its limits each individual was testing there’s.”

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Why Is Integrity So Important for Building Trust?

two business men talking

One of the greatest attributes a business can have is trust. Trust is so important between a company and its customers, as well as between the leaders of a company and the rest of the staff right on down the line. Trust can take a long time to build, but it can be lost in no time at all. One really bad decision can crush all the trust a company has built up with its customers or a company leader has built with his or her employees. That’s why one of the key elements to building trust is integrity.

Joel Peterson – A Lesson in Integrity

I recently spent some time speaking with Joel Peterson, Chairman of JetBlue, founder of Peterson Partners and author of The 10 Laws of Trust. Joel knows a thing or two about building trust. He has enjoyed many years of success in capital investments in several industries. He currently teaches Entrepreneurial Management at Stanford’s Graduate School of Business and serves as a Director of Franklin Covey. Joel also previously served as Managing Partner of Trammell Crow Company and he earned an MBA from Harvard Business School. I asked Joel why is integrity important when it comes to building Trust?

Integrity Is The First Law of Trust

Joel said that the first law of trust is integrity. “I think it’s very tough to build a high trust organization without the leadership having integrity.” Joel then explained that there are actually two kinds of integrity. “One is people do what they say they’ll do; there’s not a gap between what they say and what they do. The second kind is not compartmentalizing your life. It’s very tough to have integrity at work if you don’t have integrity in your personal life.” Joel noted that people can tell when others try to pretend that they have integrity at work but don’t have any integrity in their personal life. “If you want to build a high trust organization, it starts with the leaders having integrity.” If there is hypocrisy, there can’t be any trust.

Integrity in Times of Stress

I also talked with Joel about his experience as a leader and how he has seen firsthand the need for integrity within the organizations he has led or for which he has served as a board member. I asked him to share some situations where having integrity has really helped to establish some important decisions he has had to make. According to Joel, integrity helps the most when things get stressful. When everything is going well everyone feels good and trust is high. However, when things get tough and you are forced to do all the hard things that it takes to make a business work, that is when the trust that people have in you will help you get through those hard times. That’s why it’s so key for the leaders of an organization to have integrity.

To see my interview with Joel Peterson click here

For more on this type of topic click here

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Starting a New Business? – Be Prepared for Taxes

business owner doing taxes

Starting and owning a new business can be very exhilarating but it can also be very stressful. There are so many important things to keep track of and dozens of tasks that need your attention. One thing that can get lost in the shuffle is your taxes.

First, the taxes you owe and how much you will have to pay will depend greatly on how you structure your business: whether it be a corporation (S or C), a partnership, a sole proprietorship or a Limited Liability Corporation (LLC). If you’re not sure which one is right for you, we’ll be happy to explain the differences and help you set up the best structure for your needs.

As a business owner you could be subject to several different types of taxes, including income taxes, employment taxes, self-employment taxes and excise taxes. You are responsible for any of these taxes that are not automatically deducted. That means you have to pay quarterly tax installments. If you fail to do this you could end up being penalized and pay even more, including interest.

As a business owner you’re still not done. These are just the federal taxes that you need to track. You also need to make sure you are up-to-date on all state and local business taxes as well. Owning a business can certainly be exciting but don’t forget about your taxes along the way. The experts at GROCO can help. Call us at 1-877-CPA_2006 or click here.

For more information on tax tips when starting your own business click here

http://www.palmbeachpost.com/feed/business/consumer-advice/dont-let-taxes-kill-your-new-business/fCMXWF/
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How the Wealthy Save on Taxes

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Whether you make minimum wage or you’re in the richest 1 percent of earners, every taxpayer likes to keep as much of his or her hard-earned income as possible. There are hundreds of ways to save on taxes and many of these strategies are universal to all taxpayers no matter which tax bracket they fall into. However, there are certain tax-saving tricks that are particularly useful for the wealthy.

One of the most common methods many high net worth individuals use to save on taxes is by using tax-deferred retirement savings plans. Of course, anyone can start a retirement plan, but because the wealthy have more disposable income they can put away large sums of tax-deferred money, which provides a huge boost in the so-called golden years.

Another tax-saving strategy employed by the wealthy is to use offshore companies. By creating companies in foreign countries the wealthy can store more cash reserves away from the high tax rates in the U.S. Although many decry this practice, it is perfectly legal.

While a lot of people complain about the wealthy, the fact is, many of the nation’s top earners are also some of the nation’s biggest givers, as in charitable donations. Donating large sums of money to charity is a great way to help others, as well as save on taxes.

Lastly, the “carried interest” tax is another common strategy employed by the wealthy. This allows investors to save on taxes because they can pay 20 percent less on “carried interest” compared to normal income.

http://www.care2.com/causes/4-ways-the-rich-are-avoiding-paying-taxes-today.html
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Embracing Respectful Conflict

woman listening to coworker

When you use the phrase “embrace respectful conflict,” most times people won’t have a clue what you mean, but in fact, embracing respectful conflict is a key component in building trust within a team.

A fact of life is that almost no one agrees on everything. People have their own opinions, ideas and procedures. In a business setting, one may aggressively, even disrespectfully, argue their point thinking it makes them right, smart or good at their job. This obviously causes significant short and long-term problems. While other people may avoid conflict altogether Joel Peterson, Chairman of JetBlue and successful executive said: “You may have a very quiet organization that appears respectful, but it’s quiet like a hospital is quiet, there’s disease everywhere.” Avoiding conflict is not a good way to build trust within a company, but rather embrace conflict in a respectful manner.

How and why does this build trust? In his book The 10 Laws of Trust, Petersen says the following: “When parties disagree openly in a spirit of mutual respect and move towards—not away from—problems, trust grows rather than recedes.” There isn’t one way to solve any problem, everyone has their own ideas, many of which will probably conflict. Placing conflicting ideas out on the table for respectful discussion not only grows your own ideas and understandings, but also allows you to grow trust in your co-workers and strengthens the bond within a team.

Seek out potential conflict and obliterate it before it ever arises. Mike Mayatt, a writer of Forbes magazine says the following, “By actually seeking out areas of potential conflict and proactively intervening in a just and decisive fashion you will likely prevent certain conflicts from ever arising.” Why should you have to solve conflict when you can find it and take care of it before it ever arises? It’s better to avoid a conflict than to resolve one.  However, once a conflict raises its ugly head, swift, honest and polite discussions are in order and in everyone’s best interest.

In conclusion, avoiding discussing a conflict will only cause problems, seeking it out and take care of it before it arises will help productivity, build trust and avoid problems for you and your team.

For more on this type of topic click here

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The State of the Private Equity Industry—Is It All Down Hill From Here?

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In the past private equity has been a solid way of investing taking in trillions of capital, but with the ever changing world we live in, what is the state of the industry? Private equity investments typically consist of money being placed in a company by venture capital firms, private equity firms or angel investors. These are companies that are not publicly traded on any stock exchange and typically they are looking to launch, grow or prepare for a buyout. The money invested is typically aimed at expanding or creating new products or in some cases to fund a restructuring of the company. Private equity is a powerful force in the success of private companies that are not publicly traded. So what is the state of the private equity industry?

The Private Equity Industry Is Healthy

To answer that question, I spoke with Jonathan Coslet, Chief Investment Officer, and Senior Partner of TPG Capital. Jonathan explained that the private equity industry, like all industries, “is maturing but the core raison d’etre for the industry is growing rapidly and that’s because of our core client, our pension funds and our sovereign wealth funds in particular.” Jonathan compared the private equity industry to state governments. He said whereas the average state government is getting about 7-8 percent annually on its investments, the average firm in the private equity industry has returned about 13 or 14 percent every year over the last 30 years. “So it’s been delivering very strong returns against a US stock market that’s maybe 7 or 8 percent. So the need for the pension funds, sovereign wealth funds and insurance companies endowments to outperform fixed income securities and regular way public equities is creating real demand for our services.” Because of these factors the industry is growing and today the private equity industry has about $2 trillion of capital under its control.”

Growth Investing

I asked Jonathan what investment strategies he prefers the most. He mentioned two generic approaches that he would take as an investor: growth and inflection.  He explained growth to be the following: “there’s going to be a lot of folks who are 65 and 85 or older so there’s going to be a huge demand for healthcare services. So that’s just a secular growth that’s driven demographically and I need to figure out which part of that sector I want to get in front of because it has the most growth and has a supply-demand imbalance.” It’s important to get in front of something with a growing demand while supply is still lagging because this gives you pricing power.

Inflection Investing

On the other hand, with inflection investing it’s not the slope of the curve, it’s the second derivatives, or the rate of change. “The slope is inflecting up so being in front of something that’s about to change and that usually means an industry that’s being disrupted in transition. It happens to be that healthcare has both characteristics: it’s growing and it’s changing.” When you look for something that has both growth and dynamic change together you find the “hot spots” of investing and if done right it can lead to tremendous success.

Check out my interviews with Jonathan Coslet below. For more interviews with Jonathan Coslet click here!

 

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Critical Decisions When Launching a Startup

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There are countless aspects to launching a startup company. To do it successfully a founder has to make many critical decisions and be right on most of them. Many entrepreneurs have a great idea or product with great plans to make it successful. However, they don’t make the right business decisions, which leads to their startup either failing or never even getting off the ground. When you are ready to launch a startup you have to make sure that you have the right people in place who can help you succeed.

Put the Right People in the Right Positions

 

I recently spent some time with Montgomery (Monty) Kersten, who is an angel investor and Independent Board member of several startups. We discussed many different key aspects of startup companies and Monty shared with me some of his advice for startups that he’s gained over the years as he’s participated in the successful launch of many startups in Silicon Valley and elsewhere, “Gather around you people who have done it before and put them on the advisory board”. Instead of making them full-time employees. “Listen to their experience and wisdom because many times your early investors will be advisory board members who can help you, guide you and be supportive of you when things go wrong.”

 

Founder Must Be the Driving Force

 

Monty reiterated the importance of hiring the right people and building the right advisory board: “Never let down the bar in hiring. Only hire world class people who are willing to work as hard as you.” He added to compensate them fairly. Monty also noted how important it is for a founder to be the one who drives the company forward with a vision and a concrete achievable plan.

 

Building Your Board of Directors

 

I asked him how he recommends going about building your board of directors and how to stay in control of your company. He said the reason he is often asked to become an independent board member is because he was a successful CEO and because he serves as an independent board member and not as a representative of a venture capital firm. That’s because the founder typically wants operations advice that is for the benefit of the company.

 

Consider Your Best Long-Term Interests

 

On the other hand, venture capital firms are most interested in their own investment as board members, which is how some founders lose control of their companies. “As you build your board, you will find that the dirty secret of Silicon Valley is two out of three founders are replaced by their board of directors over the lifecycle of the company.” So in order to stay in control of your company, it’s important to build your advisory board with several independent board members instead of mostly venture capital firms.

To view the full interview with Monty please click here.

How the Internet Became Commercial

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What’s Behind the Commercial movement of the Internet? Believe it or not the Internet was not originally created to share your life on social media sites like Facebook and Instagram or to watch movies, play games or follow your favorite pastime. When it was first invented, the military and research universities were the primary users of the Internet, via several loosely connected networks. However, over time, and at a rather rapid pace, the Internet has become the commercial powerhouse it is today. That wasn’t always the plan or the goal for the Internet, so how did it become the mainstream commercialization machine that it is today?

Patterns in the Deployment of Technology

I spoke with Shane Greenstein, who is a faculty member at the Harvard School of Business, about this topic, which also happens to be the subject of his book How the Internet Became Commercial. Shane is the MBA Class of 1957 Professor of Business Administration and co-chair of the HBS Digital Initiative. He teaches in the Technology, Operations and Management Unit. Shane is also co-director of the program on the economics of digitization at The National Bureau of Economic Research. When I spoke with Shane, I noted that now that we’re moving into the realm of big data, understanding human behavior aspect of it. So I asked: “When we look at this today are there patterns that are emerging?

Repetition and Coordination

“The interesting thing is that an awful lot of what we observe today are patterns that we have seen in the past. And the more you appreciate how much repetition there is the easier it is to identify. For example, when very big things deploy you tend to find patterns of hesitance because multiple firms have to cooperate together in order to make something work as a system. Getting that coordination to work is usually quite difficult. That’s something you saw in electricity and automobiles, airplanes the Internet and we are seeing today in big data. Disagreements about fields, disagreements about getting the coordination of different ways and algorithms to get them to work with each and have standardized ways of doing machine learning so that everybody can talk to each other.”

Adaptation Problems

Shane also noted, “The other thing you typically see when big things deploy is adaptation problems. It turns out big technology isn’t useful out of the box. It requires much more investment to adapt to the needs of a particular user and that kind of adaptation is fairly expensive typically. It’s typically where most of society spends most of its money as it turns out. Again you saw it in electricity, you saw the pattern in automobiles and you see it in every major deployment. And again you saw it in the Internet and if you look at big data what’s the big problem? You see it everywhere: adaptation. Lots of firms have the data but they haven’t figured out exactly how to modify it in order to find the value in it.”

To view the full interview with Shane please click here.

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