Dave Tabor  0:04

This is the ProCO360 podcast for people who love Colorado and love hearing from Colorado’s great entrepreneurs, entrepreneurs who have something special going, something that drives my curiosity. I’m Dave Tabor, host of ProCO360 I’m a former tech entrepreneur, and I love having these conversations and sharing them with you. Today’s episode features Firestone Financial Group. Its founder, Nalicia Firestone, is in studio with me. And what excites me about Firestone Financial Group, really what excites me about any company, is when a company is brave enough, and in my opinion, really smart enough to commit to a niche. That’s what Firestone has done. It helps business owners with the financial planning and the business planning to turn an exit into a business strategy. There’s a lot to unpack in that. So, Nalicia, glad you’re on ProCO360.

Nelisha Firestone  0:58

Me too, Dave. Thanks for having me. Excited to be here.

Dave Tabor  1:00

Well, I yeah, and I really am curious about this niche that you have, and I introduce it by highlighting the niche. But start, let’s say, maybe by defining that. Define exit planning as a business strategy.

Nelisha Firestone  1:15

Well, it’s exactly that, and I think that’s what’s missed with business owners a lot. Is business owners don’t start thinking about their exit until it’s too late, and so I like to educate business owners that exit planning is a business strategy that you don’t save till the end because there’s so much to unpack there, and if you wait until the end, you’re going to miss opportunities.

Dave Tabor  1:34

So when you say it is a business strategy, are you thinking like when you start your company? Are you thinking midway through? Are you thinking when you’re when the horizon is in view? What’s that mean?

Nelisha Firestone  1:45

That’s a good question, and honestly, the way I answer that for most people is, you know, once you get past there’s a there’s a business cycle, right? Once you get past the survive stage of your business and you’re in the thrive stage, you really should start thinking with the end in mind, right? And start looking at your business through the lens of a buyer. And a lot of times, business owners don’t do that.

Dave Tabor  2:09

Wait, but I mean, a lot of companies are owned for 3040, years. So at at one point, I mean, they’re just chugging along, chugging along. I mean, are you talking about from five years in, from 10 years in, they should be thinking about building a business that someone else wants to buy.

Nelisha Firestone  2:24

Well, it’s different for everybody, right? But if you’re looking for a time frame, I think the biggest mistake business owners make is they wait too late, so or they wait too long. So I think if you’re looking for a time frame that fits for most business owners, I think within five years of an exit, you definitely need to start looking at your exit. Okay,

Dave Tabor  2:43

that makes now that that feels normal, natural, whatever. I couldn’t quite get my head around 2030, years in advance. But I suppose some people do that. But I’m going to back up just a little bit. How did you find this niche, and why is it meaning so much for you?

Nelisha Firestone  2:58

Yeah, there’s a personal story there, and so I don’t think the niche found me, or I don’t think I found the niche. I think the niche found me, and it really starts with my dad’s story. So my dad is kind of a rags to riches story. My dad grew up poor in the South, and he told my mom when they met that one day he would be a millionaire. And my parents now have been married over 60 years, and my dad left corporate America in his 30s and took a chance on himself and started his own business, grew it from the ground up, built it into a seven figure business, and ended up selling it in the late 90s when exit planning wasn’t really a discipline. And so my dad ended up exiting the business largely, you know, on his own, and with a couple of missteps during the exit phase, my parents are living a very different retirement than they should have, and so watching my dad go through that really it stuck with me, and really that’s what led me to this work.

Dave Tabor  3:54

So, so okay, add some color to that. When you say, and missteps led to a different lifestyle, okay, elaborate on that.

Nelisha Firestone  4:01

He didn’t have he didn’t build the team around him to help him navigate the complexities of the sale. You know, he didn’t bring a team in to help you know check his blind spots, if you will. I tell business owners all the time, like you’re not an expert in my business, you’re an expert in your business, and it’s my job to check your blind spots, and you don’t know what you don’t know. And my dad didn’t have a team to really help him navigate the complexities of that. My dad sold the business to his manager at the time, self-financed the note, and took the money. And at the time, back in the late ’90s, you may remember tech stops were like on fire, right? We’re at the end of a very hot decade in tech stocks, my dad invested a lot of the proceeds of the business into two tech stocks and lost half the money overnight in a bad trade. So, a lot of lessons there. It was it was hard.

Dave Tabor  4:52

Wow,

Nelisha Firestone  4:53

hard lesson learned.

Dave Tabor  4:54

Now, did you understand anything about finance when this happened?

Nelisha Firestone  4:57

I did not. No, I was 29 Did they talk to

Dave Tabor  5:01

you about it? Did they share this pain with you?

Nelisha Firestone  5:04

It’s funny you ask that. My dad is-I love my dad. You know, he’s still around. He’s not a real emotional guy. And I remember after the fact, my mom told me that she’s only seen my dad cry a handful of times, and that was one. You know, when you when you make a bad, you you know you. My dad is a smart guy. He just made a bad investment choice, and it ended up costing him dearly.

Dave Tabor  5:31

All right, so I got to ask you this, and it’s going to sound cold and callous and everything else, but the decision he made had nothing to do with his business exit. It had to do with how he manages money afterwards, right?

Nelisha Firestone  5:42

But that’s part of it, right? And so, if you have the right team around you, a big part of what we advise on is how do you take that business equity and create a sustainable, sound investment strategy and create retirement income from that equity. Yeah,

Dave Tabor  5:56

that makes sense. That makes sense. Once you’re working with a trusted advisor about exiting your business, you would also trust them to help you plan your financial future, right? Because that’s what you, yeah. So that makes sense. All right. As you describe what you do, do people get it right away, or do you have to do a bunch of explaining to help them understand that it’s not just what they think; it’s something much more?

Nelisha Firestone  6:17

Yeah, absolutely. Because you know, not everybody goes through an exit all the time, right? And also, not all financial advisors slash planners practice the same. So, one thing that that that I did to, you know, because I want to work with business owners in this phase, I got my SEPA designation, which stands for Certified Exit Planning Advisor. So that specifically helped me build up skill sets to help advise or business owners navigate this transition in their lives. I think sometimes business owners get like like a homeowner. You get too emotionally attached, right? Yeah, yeah. And you’re not looking at it objectively. And so, when I mean look at it through the lens of a buyer, you can do that at any stage in the business cycle, right, and that’s never a bad exercise because I think it gives you a different perspective on your business.

Dave Tabor  7:05

Is that it? Seems like it’s a whole mindset shift rather than just like, can I operate my business better or how do I? What do I do to make it look better? I mean, it really is. I would think that the most successful people you work with are willing to make a mind shift around this.

Nelisha Firestone  7:22

Yeah, ultimately, I think if you ask most business owners, their goal is to, you know, get maximum sell for best in value, right? You want to sell for best in value in your industry, and sometimes that requires taking a different look at your business.

Dave Tabor  7:38

Yeah. So now you ask them questions, but what are the first questions they ask you?

Nelisha Firestone  7:42

They are trying to figure out what role their business equity plays in their personal balance sheet. So, for instance, let’s say you have a business owner and they’ve been told that they can sell their business for $5 million Well, is that enough? If you’re 50-five years old and you’re going to sell. Is that enough money to last your lifetime? So what our team does is we do what’s called a gap analysis, and we will use the valuation from the business, aggregate it with their other income. You know whether it be investment income, pensions, social security, and then we will do a cash flow analysis to

Dave Tabor  8:21

similar to what many financial planners do, but from a perspective of a business owner,

Nelisha Firestone  8:26

right?

Dave Tabor  8:26

Yeah. So now let’s let’s shift gears a little bit because I want to talk about the services that you actually do perform for these folks when they come in. So if I’m a business owner and I’m like, I don’t know how to exit. I want to get. I want to figure out how to do this thing. The first thing you’ll do, obviously, ask them some questions. But what service? What does your life look like helping me sell my company?

Nelisha Firestone  8:51

Well, depends on how they come to me and where they are in their process, right? But one of the things that we do, obviously, we ask a lot of questions because we need to understand exactly that where they are in their process, and then I think the one gap in the marketplace is people haven’t been taught a process, and that was the problem with my dad. Right, there was no process that existed. So I help teach clients. Okay, this is the process. If you want to sell your business soup to nuts, this is the process that you need to follow, and depending on the nuances of your business, these are potentially the different professionals that we need to bring to the table to help you navigate it.

Dave Tabor  9:28

Yeah. So one thing that crossed my mind when we were talking earlier is that you know you you do get referred clients by others. It must be kind of there must be times when people don’t want to refer clients to you because they think they can do it, you know. And do you ever have that happen? Like people say, “Well, why can’t my regular financial planner do this for me?

Nelisha Firestone  9:48

All the time, and that’s one of the biggest blind spots I think for people. And I think a lot of people have an advisor, but I think the risk there is we don’t. All practice the same, right? And because of my CIPA designation and because of my personal experience, I think I’m uniquely qualified to come up alongside business owners and help them walk through this journey.

Dave Tabor  10:12

How many people have you done these kinds of things for?

Nelisha Firestone  10:16

I, you know, 10s of 1020, 30. I mean, there’s. I’ve been in business since 2004. Now, granted, I didn’t start coming out of the gate with helping business owners. My business has grown to that, but largely that’s the bulk of the clients that we work with today. Yeah,

Dave Tabor  10:34

and so are you? Must be better at helping them understand now than you were when you first starting out. Absolutely. How how important this is to do right

Nelisha Firestone  10:44

absolutely and and I use my dad’s story a lot as sort of a a frame of reference right because you know for most business owners their business is their largest asset I mean it was true for my dad it’s true for me and so I think I always think it’s interesting that people spend more time preparing to sell their personal home than they do their business.

Dave Tabor  11:03

That is weird, don’t you think? It’s very weird. Yeah, and I wonder is it because there’s? I mean, business people are wrapped up in their own their own business, but I mean, homes are even more emotionally connected, right?

Nelisha Firestone  11:16

Yeah. Well, businesses are people are emotionally connected to their businesses too. I mean, you spend 20, 3040, years building this thing. It’s your baby, and there’s a lot of emotion attached to that.

Dave Tabor  11:26

So, when you bring out a new client and you start talking them through this process, like, what are some of the key things? Are like, I didn’t realize that. I didn’t think of that.

Nelisha Firestone  11:38

I think. I think some of the key things are well. Number one, I think the biggest thing is people realize like, oh shoot, I should have started thinking about this three years ago, right? Because yeah, yeah, yeah. A lot of the things that we can do to help take time, and if you don’t get the right advisory team around you and start this process with you know a little bit of a runway, then you’re going to be somewhat limited in your opportunities.

Dave Tabor  12:07

Yeah, I sold when I sold. I built and sold one company, and when I did it, I decided sort of the time to sell it. I felt like okay, now’s the time, and then I started trying to sell it, having talked to you, I’m like, wow, that was stupid. I mean, it just is the wrong way to do it.

Nelisha Firestone  12:27

I don’t know about that. I mean, you know, and I don’t want to make business owners feel like you know they’re stupid or making you know bad choices. There’s just another way, and I think that’s the thing I’m trying to get. Well, there’s a better way. There’s a better way, and at the end of the day, if you give yourself a little bit of a runway, then you’re going to have more options to really increase that value. And and going back to the case study that I just shared, I mean that’s real dollars in somebody’s pocket. Yeah. So going through that process, it’s tangible stuff that you walk away with.

Dave Tabor  12:58

And it occurs to me as we’re talking that doing it sooner rather than later. I mean, I remember the emotion I had when I was ready to sell the business and started selling it. That it once you get to that place, it’s almost like a a switch is flipped, and you’re like ready to be done. And that’s like the worst time. It’s

Nelisha Firestone  13:16

the worst time

Dave Tabor  13:16

to try to make changes to the business.

Nelisha Firestone  13:19

It’s the worst time because you’re desperate at that point for whatever reasons driving you. I mean, think about COVID. I mean, that was a really hard landscape for business owners to navigate, and there were a lot of people I talked to during that time frame that were just ready to call it quits. You know, you know, the last thing you want to do is unwind your largest asset at a time when you’re not thinking clearly, and you know you’re letting emotion drive,

Dave Tabor  13:43

or or lack of emotion. I mean, at some point, like I remember feeling like I don’t want to do this anymore.

Nelisha Firestone  13:49

Yeah,

Dave Tabor  13:49

and that’s a terrible time to sell your company, right?

Nelisha Firestone  13:52

Terrible time.

Dave Tabor  13:53

So there’s, but it’s not just about the money. A lot of times, there’s also you mentioned people who built a business for 20 years, 30 years. There’s yes, there’s cashing out, but there’s so much more. There’s like the whole notion for some people of legacy, of taking care of one’s employees, of you know those kind of. How do you so? How do you approach those conversations? I suppose everyone’s different because some people care about that stuff. Some people just want to check and go walk away.

Nelisha Firestone  14:19

Yeah, fair question. And that those are all the questions that we ask in a discovery meeting, right? Because there’s no one size fits all. I mean, it’s like a sleep number bed. Everybody that comes in front of me has a different story and a different goal. And you know, money’s a tool. So what we try to understand from our clients is okay, money’s a tool to really accomplish what’s really important to you. And to your point, it could be you know buying or building your dream home. It could be leaving a legacy to your kids. It could be taking your family on a world cruise. Whatever that is, it’s important for us to understand what the purpose and intent is behind the money, and then the rest of it. Is just part of the process. Yeah,

Dave Tabor  15:01

what would you have done if I had come to you saying I’m ready to sell my company right now? You know, and I’m already kind of there emotionally. What do you? I’m sure that’s happened with you. I guess you talk me off the ledge or just go with me.

Nelisha Firestone  15:17

Well, so that’s when we really say, okay, we hear you, you know, and and that’s that’s a valid point. What do you have? You gotten a business valuation done, and you would be surprised how many people say no. They think they have a number in their head because, oh well, my competitor down the street sold for this. I’m sure I can get the same amount. Well, maybe you can’t because we haven’t looked under the hood in your business, you know. So really, what I try to do, I say, okay, let’s let’s slow down a little bit. Let’s get a business valuation done and see what you can go to market for based on you know that analysis, and then that’s when the light bulb sometimes goes on for business owners. It’s like, oh, well, I thought I was going to get double that, and then all of a sudden the brakes go on, right? Because people realize, like, oh, well, that’s not enough for me to live on. And then that’s when we can come up alongside people and say, we can help you fix this.

Dave Tabor  16:12

So they may recalibrate their decision timeline,

Nelisha Firestone  16:15

right?

Dave Tabor  16:15

And does that happen?

Nelisha Firestone  16:16

Absolutely, yeah, all the time.

Dave Tabor  16:18

I would think so. All right, there are other things involved too. Beyond that, there’s all kinds of cash management things. There’s tax. I’m sure you have to get into all that stuff.

Nelisha Firestone  16:28

Yeah, of course. I mean, taxes are huge, right? I mean, there’s not a business owner in the world that’s going to tell you, “I want to pay more.

Dave Tabor  16:34

Yeah, yeah, yeah. Of course, yeah.

Nelisha Firestone  16:36

So a lot of what we do is around you know tax mitigation, tax planning, and it’s not just that’s not just my role, you know. There’s a lot of other professionals that can come to the table and help with that, such as you know, obviously CPAs, estate planning attorneys can help with you know doing different trusts type setups to help transfer wealth to the next generation. Maybe restructuring how your business files is a way to save money on taxes. So there’s all kinds of different disciplines that we can bring to the table to help. You know, when all of those disciplines are working together, that’s really when good things happen.

Dave Tabor  17:13

So in some ways, you’re kind of like a general contractor over this process. We call

Nelisha Firestone  17:16

ourselves a quarterback. Yeah, I mean, we don’t do all of the things. We fill a role. I mean, there’s a lot of people that need to come to the table, and we’re sort of the quarterback. And luckily, we have a deep bench of professionals that we can call on.

Dave Tabor  17:30

I’ve learned over over the years that bringing smart people to complicated problems tends to be pretty cost effective.

Nelisha Firestone  17:36

Well, and that’s what we like to do. I mean, we like to deal with the the hard stuff, because I think that’s really where the opportunities and the risks are for families.

Dave Tabor  17:44

Yeah. Now I watched a video on your website, and you you shared a story about your mother being widowed. My

Nelisha Firestone  17:53

grandmother.

Dave Tabor  17:53

Grandmother. Yeah. Okay. That makes more sense because your parents are so. All right. I was trying to figure out how that’s going to work. Okay. So your grandma and she wasn’t prepared to say. Well, just you know what, tell that story.

Nelisha Firestone  18:05

Yeah, my grandma. I mean, it’s my mom’s mom, and she’s a great woman. She grew up in Kentucky, born, lived in the same town her whole life. lived lived a very simple life. My grandpa died on my mom’s wedding day, so my grandmother was widowed at age 49 Happened to happen on my mom’s wedding day, and she no never thought she would lose her husband at 49 And I remember growing up going to visit her, and she was widowed young, right? And he didn’t leave her with a lot, and so she did everything she could to make ends meet. I mean, she rented out the top floor of her house to college students. She volunteered at night at the hospitals, and you know, did some work there. And I don’t know that that’s another family story that stuck with me, you know, because I love my grandma and I saw how hard it was on her to be widowed at such a young age. So I have a special affinity for you know women navigating those transitions. Is

Dave Tabor  19:06

that part of what you lean into as well?

Nelisha Firestone  19:08

I do. I mean, I love women. Women in finance has changed a lot over the years. Women are becoming more of a voice at the table. I think I just read recently that we control a third of global assets now. Wow. So that’s quite a change for my grandmother’s era. Yeah, so it’s nice to see more women coming to the table and being decision makers in the family finances, and I’m always happy to be a partner with them.

Dave Tabor  19:32

Now, this is the ProCO360 podcast, so I feature companies based in Colorado. Is you know what does that mean for Firestone Financial Group being here, anything special different?

Nelisha Firestone  19:45

Yeah, well, I love Colorado. I mean, I I married a native. I moved here in ’99 because I love to ski, and that that still is the case. I married a Colorado native. I have two daughters who we’ve raised here, so I’m a big fan of Colorado. But as far as business and. Colorado, it’s changed a lot, right, over the years. I think current laws and current local administration has made made a little bit harder on businesses. So I’m a part of the WPO group here in Denver. It’s called Women’s Presidents Organization, and it’s comprised of it’s a group made up of female business owners, and we meet once a month. We kind of act as an advisory board of sorts for each other, and we talk often about you know Colorado and FMLA and all those things that are making doing business here a little bit harder these days.

Dave Tabor  20:33

It it has gotten tougher, and we’ll hope that that trend shifts the other direction. I know. Yeah. Now going forward, I mean, you talk to a lot of businesses. You see a ton of businesses. You you spend most of your time helping them. But how have they helped you run your company? What have you learned from them?

Nelisha Firestone  20:53

Well, I’m going to give you an interesting answer, but I I think that you know, I think business. I think people that decide to go into business for themselves are a special breed of people, right? I don’t think everybody can do it. And I think what I’ve learned from my business owner clients is that you know someday I too want to exit. You know because I’ve also watched you know as my parents have gotten older, they’re in their 80s now. You know, I talk to clients like, yeah, you might live until you’re 90, but you may not be fully healthy up until 90, right? And so, usually, what I see is people are really active in their lives up to 70-five or 80. So, you know, I don’t want to work until I’m 70-five and have five good years, right? So, I I see, I go, I journey with people as they age, and so I’m very keen to the aging process, and I as well want to exit my business and you know spend time doing you know what I love other things. Yeah, yeah.

Dave Tabor  21:50

Wrap us up. What should as business owners think about all the things that we’ve talked about, all the things that you do? What are some sort of guiding principles that they should think about relative to what’s the term we talked about exit planning as a business strategy, right? So wrap that up.

Nelisha Firestone  22:09

I think that business owners just need to take a hard look at you know where they’re at. I think one thing that business owners don’t do is they’re they’re so in the grind of the day to day, right? And they don’t really allow themselves the time to like really visualize and and think big, right? I I would I would invite business owners to take a little respite from the business and really think about okay what where what is my end game where do I want this to go right and start to look at the advisory you know the people that you have at your advisory table. Make sure you have the right people to help you journey because journey through to the end. Because just because you have advisors doesn’t mean that they’re equipped to help take you through to the end.

Dave Tabor  22:51

And you know what you’re making me think is that even if somebody thinks that the end of the horizon is 20 years, 20, like they could come talk to you today and just sort of brainstorm, like here’s where I’m thinking I’ll be in 20 years, and even that could be helpful, right?

Nelisha Firestone  23:05

Well, yeah, you’ll learn a lot. I mean, one thing that comes to mind is, you know, people again. I go back to our goal is always to solve problems you don’t know you have, right? And time on the runway is important so that you can do things now. So, for instance, you know maybe you’re not paying yourself enough in a w2 wage. Well, that’s going to impact how much you can put in a retirement plan, right? Well, that’s one thing that we can advise you on now to tweak and change that will only help you later. So it’s things like that. I think the business owner needs to realize. Don’t wait till the last minute. It’s important to start asking these questions now because it can make a big impact in the end.

Dave Tabor  23:46

Cool. I think that’s a good note to end on. And let’s do that. I’m your host Dave Tabor, and today on ProCO360 you’ve been listening to my conversation with Nalicia Firestone of the Firestone Financial Group, and it’s been fun having you on ProCO360

Nelisha Firestone  24:00

I really appreciate you having me, and yeah, it’s been great talking to

Dave Tabor  24:04

you. I, I wish I’d known you many, many years ago before I went through my process. Anyway, listeners, glad you’re here on ProCO360, where we say live, work, love Colorado, because you and I and my guests can be successful anywhere and choose Colorado. You make the show successful by subscribing to the ProCO360 podcast. If you haven’t yet, it’s a huge help if you submit a review in your app. That’s the show Live Work Love Colorado.