The first thing you think of when you hear the word ‘accounting’ isn’t always sexy.
But on today’s episode of The Marketing Natives, we hope we can change that narrative for you.
We had the opportunity to sit down with Sean Duncan from SMD Consulting and talk about the next generation of accounting and how business owners can leverage the new model.
You’re going to love this episode!
We’re talking about:
- Why Sean skipped out of a career with the FBI to chase a life of purpose with his family
- How SMD created a new model of accounting that every business owner needs to know about
- And the three categories you should be writing off in your business to save on taxes
If you’re a local business owner who wants to generate more qualified appointments online we created a free training to show you our proven three step process. Watch the training
Aaron [00:00:00] Hey guys, welcome to another episode of the Marketing Natives. We have an amazing episode with Sean Duncan from SMD Consulting. We're going to talk about why Sean skipped out on a career with the FBI to chase a life of family and purpose. How SMD created a new model of accounting to every business owner needs to know about, including ourselves. And three, the three categories you should be writing off in your business to save money on taxes. It's an amazing episode, take a listen.
Narrator [00:00:25] This is the Marketing Natives. Providing actionable ways to grow, improve and succeed in your business.
Narrator [00:00:33] And now your host, Christian and Aaron.
Aaron [00:00:41] Alright, Sean. Thanks so much for jumping on the show. Looking forward to talking with you more. Welcome to the show.
Sean [00:00:47] I appreciate it bud, looking forward to it. It's been a long time coming.
Aaron [00:00:51] I know, we've been planning this for like five months, six months?
Sean [00:00:54] At least.
Sean [00:00:56] Well, we talked about it last year, I think is what it was. Just everybody's schedule is so busy. So, yeah, we got we had a chance to finally get it coordinated. No new diseases to screw things up.
Aaron [00:01:05] Yeah, man, I know. Are your remote right now or where you guys at?
Sean [00:01:10] Yeah. As much as I would like this to be my office. No, this is home with the stage. We actually we were already working pretty remote most of the time. So the conversion to the home office wasn't that big of a deal.
Aaron [00:01:21] Nice. Yeah, I was going to say those I've been eyeing those stormtrooper heads in the background there.
Sean [00:01:27] Yet two of them are actually full gear.
Sean [00:01:29] So the third one is just just because I wanted the bucket.
Sean [00:01:35] I actually I.
Sean [00:01:36] It's part of the Five First Legion, which is a 501 C3 organization. So when you see Stormtroopers, Darth Vader coming up for hospital visits and making wishes, I'm one of those guys that does that.
Aaron [00:01:48] Oh, that's awesome.
Christian [00:01:48] That is pretty cool.
Aaron [00:01:51] I need to introduce you to a guy who is probably right up below you is biggest fan. He's a Dun Richardson. His name is Lance Graney he owns action video service. And he's a huge, huge Star Wars fan as well. He's got some crazy trinkets, his whole offices is the same thing. So you guys can definitely geek out. I need to introduce you guys.
Sean [00:02:11] Yeah, the older I got the more I realize this from go ahead and keep acting like a kid. My seven year old self, my promise was one day I'd have a stormtrooper costume. So now I have to. And I'm working on on a third.
Aaron [00:02:21] Awesome. All right. Thanks for jumping on here. So for those of you who do not for those who are listening, who don't know who you are, how would you describe yourself? What's your business? So who is who is Sean Duncan?
Sean [00:02:33] So I'm a CPA. Which is really automatically a way to get people to walk away from you to party. So if you introduce yourself as CPA, it's either, hey, I have a question and then they get free advice or they walk away, refill their drinks. So I've tried not to be whatever. Whatever you imagine a typical CPA to be. That's not me. Background's different. How I got into this business is totally different. So my entire plan was how do we actually help people? I've got these skills and this ability and this knowledge to be a CPA. So and to steal a line from a client that we use for our marketing, we do what you wish your CPA would actually do. We focus on strategy and advice. And so when I show up to work, it's got to matter. We've actually got to be helping people out. Otherwise, what's the point of doing all this stuff?
Christian [00:03:17] Interesting. So you veered off from the traditional CPA services and you're doing something a little bit different. How and why did you get started with that?
Sean [00:03:32] How and why? So back in 2006, I started the firm and the whole point was, how do we actually help people out? Because they're small business owners everywhere. There's tons of amazing, brilliant tax preparers and bookkeepers. But the common thread and what I kept hearing because I was working at a large regional, there was nobody giving advice. Nobody sitting down and dealing with the strategy. Nobody figuring out how do you save more money? How do you build more cash flow?, whatever it is that business owner wanted. And I made the mistake of saying, well, somebody needs to start a firm like that. And if you ever hear yourself say somebody needs to start that, that pretty much means I'm about to start that. And so 2006 is when I started it off plan was me and a couple of folks one day just I would hope to have an office. Fast forward in twenty seventeen. We looked up and we were actually the largest firm in Frisco. And I mean, adding hundreds of clients every few months. It was, it was ridiculous, the amount of growth. But the challenge with that was while we were famous and known for being the ones that can explain things and give advice. The tax prep was taking us away from our clients and giving the advice. I mean, we were chasing deadlines. You can't do fifteen hundred tax returns in a few months and not ignore your clients when they call for a question. And that was just counter to the message, counter to the mission, what we were trying to do. So Twenty seventeen. That's when we really veered. We, I double down on, we're there for advice and we fired all of the tax returns. We only do bias, we do books, but we do books through the premise of giving advice and helping people with their life plans, their business plans and their strategies. And so why it was the whole purpose. That's why we do it. We do it. If I just sit down and fill out forms all day, I'm not gonna be a fulfilled guy. I'm not helping people out the way I want to.
Aaron [00:05:14] Dang. OK, we're going to go there. But I think that, you know, just kind of reviewing this. I want to step one step farther back. And it's just something that I think people should know is so you turn down an opportunity to join the FBI. Can you explain? That's just a I don't know, we want to know more about that. Let's get into that and then we can come back to this for a second. Because I feel like we should definitely touch on that.
Sean [00:05:38] So when I speak to kids, I actually often go to college a lot of times and I'll talk to classrooms about careers in accounting, because when people talk about accounting, they think I'm going to grind out tax returns, I'm going to do books. And it's just this kind of rote routine, routine process. But really, with this knowledge, you can do a ton of stuff. And the short version is when I was in college, I was just a dumb Mehcad. I just kind of getting my way through chasing girls around, doing the usual thing that we all do in college. And I didn't have a direction. And I remember sitting in an accounting class and they're talking about careers in accounting and FBI came up. The easiest way to get into the bureau is law, language, and accounting. And I happened to be sitting in an accounting elective, not that I chose it over the other two. I just, it was convenient. And I had that crystal, you know, that bell ring of epiphany that said that's what you're gonna do with your life. And immediately, my GPA skyrocketed. I got a master's degree. I never intended to get them taking it even further step back. I'm the kid of a construction worker and no one in my family had a college degree. So this was, I was already blazing a trail that nobody knew what to do. So I'm sitting in this classroom thinking, OK, I don't know what I'm doing, but I figured this out bureau. I mean, it it was absolutely a calling. And so fast forward knock out the master's degree. I've got corporate accounting experience. I've got public accounting experience. I'm interviewing at the bureau. It was immediately post 9/11 when the prior to 9/11, a lot of people don't know bureau would have six and 12 month hiring freezes. I'd submit my application and they'd say a great unless you speak Farsi, call us back in six months. And so post 9/11, hiring started back up again. And I remember it was March of 2003. I was sitting there with my final interview scheduled. They were flying me to Kansas City. Dallas coordinator said I was his best candidate. Just go through the motions. I'd be in Quantico by September. And imagine decades worth of work. Everything you did in college and grad school and career was leading to that moment. And just as clear of an epiphany, it dawned on me. And after a long conversation with my wife and a lot of soul searching, I realized if I pursued the bureau, which was highly compelling and I mean come on, you're carrying a gun, you're chasing bad guys.
Aaron [00:07:52] Right?
Sean [00:07:53] I wasn't just going to do bureau because I was a dumb meat head. I was also going to do hostage rescue team, which is essentially bureau SWAT. My goal was to jump out of helicopters and kick in doors. And I looked up and realized if I do this and I ever think I'm going to have kids, I'm going to be an absentee dad. I mean, you're going to be gone doing investigations. I mean, they're known for the 16 hour work days. You know, you're when you do when you're in the bureau. They tell you to have a three and a 30 day bag packed and the three day bag mean you're gonna be gone for a week or two. And a 30 day bag means it's Oklahoma City bombing. You may not see your family for a month or two or three. And while the mission is compelling, it dawned on me in those moments that I really wanted to be husband and dad so much more than I want to chase bad guys. And so I was 30 years old and I looked up and went, oh, no, I have an accounting degree and a master's degree in accounting. The only reason I had it was to go into the bureau. And I had and I called him up and I turned him down. I took my name out of candidacy and said that this is not what I need to do with my life. And it was time to reinvent. But it was it was a very hard decision because it wasn't just a career. That was my identity from that moment, sitting in that accounting elective all the way through grad school and everything else, it was that was what I was going to be. Not so much just some job I was going to do.
Aaron [00:09:14] Wow. And how did your like your family like so not only your like your wife, but I feel like as entrepreneur like or just like as you're growing up, you like you want to, like, impress her, like, you know, your parents to be proud of you or something like that. And you're about to do this crazy thing like which is just amazing. And then like it. What was your reaction from your wife and your your parents?
Sean [00:09:38] It was a little all over the map. I mean, there was shock, obviously, because it was not it was known that I was going. It was known that I was a great candidate. It was like everybody knew the pieces were all in place for this to happen. My wife was amazingly supportive. In fact, actually, the way the conversation went down was a lot of questions. You know, how would this happen? You know, sweetie, you know, they're going to move. She's that's okay. I'll find a job. You know that there's this is again, 2002, 2003. Jobs were wide open when you quit a job and go to find another job. There was there was a tougher time than just trying to find some open position. I actually knew we would take a pay cut. You know, our income would decrease, which is like that's a rate. And then when I asked the question about how would this work with kids, I mean, how are we going to manage this? She stepped back and said, I know where you're going with this. And she goes to your call. You decide what you want to do. I mean, she was amazingly standing. It's do what you need to do to be fulfilled. We'll figure the rest of the pieces out. The family was also wildly supportive, but there was a lot of hope. Are you sure? You know, you've been working on this for a really long time and there was a lot of just double check on it. And it took a little while to be sure, but once I withdrew my name, it was absolutely the right choice. There was no question because it was more important to be president and I didn't have kids by the way. I just knew that if I did, I needed to be present in their lives and not just some dude that sends a check.
Aaron [00:11:04] Wow.
Christian [00:11:04] Very interesting.
Aaron [00:11:06] I just yeah, I was gonna say that's this is crazy, so. And then what happened right after this to get you to that point where you guys became the largest Just so we kind of connect the dots here. Like, did you go straight into starting that firm or what happened after that?
Sean [00:11:22] You know what? when I tell this to kids, I am really candid about it is I was a completely lost soul for about two years. I mean, you imagine everything that you've built for. The degree that you have. I'm 30 years old and I'm looking up saying, do I go back to school and start all over again? And that was a real question. And it was, you know, what color is your parachute and everything you could do for two years? Try to figure out. Now, my current employer at the time had no clue. I've told them since because people I used to work with, I told them the plan was they had no clue that this was all going on. So I kept working there for a couple years. But it was soul searching. It was about what is what you gonna do now? And the other clear moment of really thinking and introspecting is why was the bureau so compelling? It wasn't just, hey, I want to do the job.
Sean [00:12:10] It was a calling. And it dawned on me that the reason it was so compelling was because the job matters. And that's really the key. The job matters when I'm laying on my deathbed 400 years from now because I am absolutely going to be part robot my kids know it. When I look back, did all that stuff we do matter? So when you think about everything you do in a day, the amount of hours you put in it with work, if you just kind of get by. And you just kind of get by at eight or 10 hours a day and kind of do that for 40 years, you kind of wasted your life.
Sean [00:12:45] And that's what's really important to me, is I want to make sure that if I'm going to spend this amount of time, I'm actually doing something meaningful. And by the way, I know that's a very millennial statement and I am very much not a millennial. I was a millennial before they all existed, but the career I have has to match. And that was it. That was that moment when I realized it has to count that converged with conversations with prospective small business clients when they were saying they can't find a CPA to help them. They really just want to help. And those two met those two roads met where I'm trying to find out something that actually matters and helps people. And I'm getting these people that are begging us to help them, but they can't afford the firm I'm with. That started the firm. It was there are people that I can help because I have the skill and knowledge that I can bring forward and to get to the firm what we need to do. But then when you talk about twenty seventeen, when we stopped doing tax returns, it was actually the same style decision is we were successful by virtue of the number of clients and how big we were and how we were growing. But it wasn't fulfilling. It wasn't meaningful. Doing a tax returns important. But is it really valuable? And that was a value proposition as we work helping people the way we wanted to help them just because we were filling out forms. And so it actually wasn't that hard of a decision, even though it was a pretty massive cut. I mean, we're talking about a business that's growing and getting very well-known. I won't say famous, getting really well-known in the first go in the surrounding areas. To then just shrink it back down to what its core was supposed to be. But it wasn't that hard because it really brought me back to that exact same moment. It has to matter. And so when we come in. Our job is to be the advisors to help people out with what they're doing. And it just kind of flowed from there. And what's really an unintended consequence, because we did this, we started getting national recognition for what we were doing as innovators in the industry, which wasn't the purpose. The purpose was recentering back to the value proposition. But next thing you know, we're getting national awards and invited to speak at accounting events. And it was the benefit of unintended consequences. Do something right text thing you know, doors open for you.
Aaron [00:14:57] And so at this point, it's 2020. You guys are three years into like this new model. What are you realizing or shifting now? Because it just from what you're telling me, it seems like you guys are continuing to change and shift and continue to make a better client experience. So what's, what has changed now within the last.
Aaron [00:15:15] I don't even know, six month. We're in a pandemic right now. We're going through a pandemic. So has there been any major shifts even in the last six months from what you did whenever you started this in 2020, like moved to this new model?
Sean [00:15:27] Absolutely. So the first actually the first year and a half or so was trying to figure out exactly which way we're going to deliver this. I mean, it was, think of it as a new product. We were beta testing some new product model that we tried to meet with clients monthly. We tried to meet with clients twice a year. We had to figure out what really created value. So the first year and a half was a lot of stress testing to figure out how things came out. Once we nailed that down, we then started expanding the scope of service. So we're now what's called while we do the business tax and the consulting stuff that we do, we're now a full family office. And are you familiar the concept of family office, if you heard that term before? No, no. Aaron, the billionaire wakes up in the morning and he gets out of bed and goes, you know, I'd better check on the status of my seventy six companies. You know, what I'm going to do is I'm gonna call my lawyer and have him add or consolidate or double check some things. And when you, the billionaire, call your lawyer, you're not calling a law firm. You're calling the guy that works for you. And by the way, he's probably sitting in an office next to the accounting team that works for you and the financial adviser and the insurance people. You're so rich and you have so much stuff going on. You have an entire family office of all those professions that you need. Well, if you think about it, every business owner ever needs a lawyer, needs an accountant, needs an insurance guy, needs a financial adviser for wealth management. And the way it works currently is everybody kind of goes and networks and shakes hands and then sends referrals back and forth. But there's a segment of the end of the world that's not billionaires that still needs that, that are successful entrepreneurs. There is the family office model where you help the less successful the non billionaire. So the good earners, the successful business owners still need those resources. We now have pulled that all under one roof. So SMD is now a full family office, not catering to one individual, catering to business owners that need the comprehensive services. So we took our expansion of consulting and now fold in. We'll help have our attorneys draft documents. We'll have our wealth management team balance that out, because when you're a business owner, you've got this high risk investment of your company. How do you balance that out with your wealth building and estate plan and all the things that go with that, whether you're starting a new business or exiting a business. And so we've expanded how much of the comprehensive advice that we excuse me that we can give by virtue of now in nailing down the business and tax part and then adding in all those other services.
Aaron [00:17:57] Wow. So that's.
Aaron [00:18:01] That's great. I mean, I've heard of. I don't know. Christian, I've never talked about this before, but I've heard of like you know, wealthy people having a team of experts who kind of just manage their stocks and manage their affairs and stuff like that. But I mean, I've never seen or heard of anything like if Christian has heard of anything either, but like of something like this for the local business or the small business owner. So you guys really are doing something.
Aaron [00:18:27] I mean, something very innovative because I've never heard of it makes sense. Whenever you hear it. But I've just never heard of anybody putting the pieces together like that.
Christian [00:18:35] Yeah, absolutely. I guess some curious. I'm curious. Yeah. The process or how do you come up with ideas like this? Right. I'm just curious if you have coaches or mentors or anything like that or if it's more of a sort of company thing, right. Where you guys get together. And you kind of mentioned something right now where you spent a lot of time trying to think of ways to innovate. So just curious on that aspect of your business and your process when you're coming up with these ideas.
Sean [00:19:14] So it's a combination of everything I could possibly do. So I spend and dedicate a lot of time with my team knows it. I have work on the business days. And this is anywhere no less than quarterly, but usually six to eight to 10 times a day or 10 times a year. I will hide, I'll go off the corner bakery or I'll go sit in a Starbucks and you'll see me with like nine notepads, a laptop, an iPod. And all I do is think about how I want to do things, what's working, what's not working. I dedicate time. I take no calls, I take no emails. I am working on the business that day. Everything is about what I can do for the next three months to keep us moving toward whatever the mission and the goal is. Even in those moments in this all this I've told clients this before, but it terrifies them every time I say it. I even stop and consider, is this what I need to do for my life? Like, should I just shut this company down and start doing something new? And the fact that I'm still here means I'm still doing my mission. But yes, absolutely I use coaches. Absolutely I read books. Absolutely I go to conferences and get as many ideas. Absolutely, we sit and brainstorm stuff periodically. Not as much as I'd like inside the office, but we have we try to have as much dialog about, hey, what about this? Hey, what about that? My team is a little tired to me coming up with ideas like we want to stay on this. I'd be like, I scream squirrel and then do the next thing. But I know there's those moments when I have 10 ideas in my head and we just have to choose the two or three that we can execute. And know the other seven or eight are amazing, but we have to channel ourselves and it's better successfully two or three things great. Then just try to do ten and do them all terribly. And so we're constantly doing and there's a phenomenal book out there called Traction that talks about this as well, where you focus on your rocks. I know one go in here in five years. What do I need to do in the next three months to be there? And there's about eight, 10 different paths to get there. There's no one way to reach success. It's just choose the one that's optimal for you and and you'll screw up. Oh, my gosh. The number of times I've screwed it up. Ridiculous. But it's like Simon Sinek will say, keep falling forward. When you screw up, get up, figure out what you learn and keep it moving forward. And that's been a big part of it will do. I'm willing to take those chances and try something new and try those crazy ideas. So I dedicate a lot of energy toward how can we do this better?
Aaron [00:21:39] What would you say is something your super excited about now that you guys are either in the midst of or are about to launch, maybe if they aren't able to really share with us yet?
Aaron [00:21:48] But what are you most excited about now? Because it sounds like you're still showing up each day and you're still doing this what you want to do. So that's good. But you must be excited about something or just making something more efficient. So what what is it you're excited about?
Sean [00:22:01] You know, this family office thing is going so much better than I imagined. So I had been researching this for years and it really wasn't I. I get until I really gave it energy late last year and started truly thinking, how are we going to do this and who are we going to work with and how is this going to be and what's the target client going to look like, you know, who's the ideal client? And I dip my toe in it and it took off like a rocket, made it. When you're a business owner and I'm going to give one client example clients, a physician, he's five years away from retirement. Physicians make really good money. He has real estate investments. He's trying to figure out. He called me because he knows we understand real estate and real estate investments. That's why he called. Hey, can you help me optimize this, minimize my tax, improve my cash flow, all the usual accounting nerd stuff. But then we find out he's in this transition period where he's about to retire. He has wealth. How do we bring that into retirement and help him make decisions? How do we do his estate plan? How do we get the money to his kids in the most tax efficient way? How do we help them build more wealth while he's rolling this up? I mean, he has a pension decision when he leaves the job. How does he take the check? Is it a lump sum? Is it an annuity? There's all these decision points. Business owners have and this is just one, but that is the whole point of the family office. It's not just a tax question. It's a tax. It's a wealth management. It's an estate. It's those things have just been taken off like crazy. And it doesn't mean that they're more fulfilling or less fulfilling, because if I have that early stage business owner that's really rocking and rolling and trying to understand how to run a business and doesn't even know the accounting rules and I can say make those changes, you'll save twenty thousand dollars a year in taxes. That's pretty awesome, too. But I'm I'm super excited on how we're helping the successful business owner bring it to another echelon that we never could do before because I was never a trust and a state expert. And that's a whole different set of tax law. We now have the trust and estate team that can come in and balance that against all the other stuff that's going on. So it's turned out much more successful than I ever imagined would be. And the second one is more of a surprise. I had no idea that CoVid would actually help our business. We've been doing zoom meetings for a while. We've been trying to get as many clients as we possibly could. Just let's just do zoom. There's no need to drive to the office. Just finish what you're doing. We'll log on. We'll cover everything we need to cover. And that saves you that time. But no no I need to come in. Or if a client's in Fort Worth and we're in Frisco. Oh, you're just too far. When CoVid hit, everyone went remote. And so then suddenly Zoom meeting was completely acceptable. And I had one week a few weeks ago I had meetings with people in nine different states. And there most of them were prospects calling us up from California, from Hawaii, from Colorado, that it doesn't matter where we are, we're still we can still do the work and help people out. And that immediately just broadened our reach. We could help more people just by virtue of the pandemic, making this kind of conversation acceptable.
Aaron [00:25:09] How would you, I guess, since this is kind of a new model, how did you figure out pricing for it? since it's more of like like you said, a consulting package. But you're actually doing some work. So it's like there's a there's a mix between the two of them. So how do you do? How have you set up your pricing for that?
Sean [00:25:25] So we actually one of the things we also did in twenty seventeen is we killed the hourly rate. We don't bill by the hour. We fixed fee everything. And so a lot of that's leveraging our experience. But it's a concept called value pricing. That's largely due to complexity. Now, if I help you guys out and I save you 40 million dollars a year, I'm not going to charge you 10 bucks. But it also means I'm not charging you 10 percent. My license doesn't allow me to charge a percentage of savings. I would lose my license. It's about what do you have going on, how complex it is. And we extrapolate the amount of time and value we can add from. And so it's a little bit of a hybrid of what we know going on from experience and what we know the complexities could be. But also it marries up how much good are we going to do for you and where it's going to go? So it's there is no one answer. And that was part of that year and a half to two years of stress testing to find out where that happy medium was. But we did discover that if we do the hourly rate, people don't contact us. What are the single biggest barriers we ran across for a CPA? Actually, being able to help people out is nobody actually picks up the phone because imagine if you have a question and you're going to ask for CPA. If you can write off your golf cart and your business, you're going to go. I'm not going to call them and pay seventy five bucks just to answer some stupid question. I got to Google. We'll Google, by the way, as a big fat honkin liar when it gives you advice. But if you knew that you were paying a fixed fee every month anyways and you can call your CPA or e-mail them as many times as you want on those little questions, you're more likely to get the correct information customized to your specific situation. And it's not an incremental cost. But, man, if you've got to pay a quarter hour of time, everybody feels like they're getting nickel and dimed. So we did that to kill that and open the door for conversation. And again, that's been that's been amazing, too. Client can just ping us. Hey, am I allowed to do this? Nope, you're done. But if they go, Google will find out it's allowable in Puerto Rico and suddenly to think that it applies to Texas. And next thing you know, you get a ten thousand dollar cleanup project.
Aaron [00:27:28] Christians taking offense to that right now, he's from Puerto Rico.
Sean [00:27:32] By the way, Puerto Rico has an amazing tax rate. If you're there. But so many people think that they can just leverage that. There's this there's a lot of articles out there that if you start your business in Puerto Rico, you can get the advantage of the four percent tax rate. Yeah, but you've got to be there something like two hundred and fifty days a year. And then the client goes, oh, I'm not going to be there that much. Then it doesn't apply. Now, if you are going to move to Puerto Rico and be there two hundred and fifty, let's talk about your four percent tax rate, because we can play some games there.
Sean [00:28:06] So because we're unique, because we have this weird niche of being advisers and we have certain types of clients. What has been your best experience in finding getting to the right audience, not just Google ads and the simple I mean everybody can do their paperclip? What's a meaningful way for a business owner with a unique niche? We obviously have, to reach the correct audience so that they actually attract the right people to become clients and not have to filter through as many just random prospects.
Aaron [00:28:36] That's actually falls in perfectly with what with our messaging platform, which we would tell you is that so you should be creating content, which I assume that you are. The best way for you to be in front of your audience is to allow them to opt themselves into it.
Aaron [00:28:53] So, for example, we have a three type like three tier approach that you should that we tell everybody to use, which is one lead with something that's like a thought reversal, which means it's like a common misbelief misconception, whatever it is about your industry, which you fall into perfectly. That says that, hey, I'm an accountant and this is what I do or this is what they are supposed to do. So you would flip that on its head and say this is the old school way of doing accounting and you would lead with this type of video, whatever it is? Like, so for us, I would say, like, stop doing know, stop showing up to networking events. If we were doing that, like if we were targeting local businesses, we'd say stop going to networking events to grow your business. And that would be a thought reversal. So the lead with a thought reversal and then a connection video which is like, OK, let's find out more about who you are, which you've done on this podcast, which you could use again and cut it up later is OK. Who is Sean? He's a family guy. He started a business. He can relate to you. You're going after business owners. You're looking for people who want to spend more time with their family. You're looking for more people who want efficiency. They want all the access. So now everybody's like, wow, I can connect with Sean, which is great. And then you do a third type of video, which is what to do video. So now you need to explain to them this is what you should do. So like he just explained again. Hey, Christian, if you live in Puerto Rico two hundred and fifty days out of the year, let's talk about your tax rate. But if not, these are other ways that I can help you with your taxes or the things that you could do. Most people don't come up with those three types of approaches. And if they do, they forget one big key, which is you should focus on video number one, which is that thought reversal and get them to watch seventy five, twenty five to seventy five percent of that video depending on the length. So that then they watch a connection video and if they watch twenty five or seventy five then they see the what to do video. And if they watch twenty five or seventy five percent of that video then you show them an offer to schedule a consultation or to do a free training or to do something. So then you don't have to worry about finding a target audience because they've already raised their hand and said, oh, I love what SMD is doing.
Aaron [00:30:52] I'm going to watch this video. Oh, I love Sean and I love what they're about. Great. I'm know what I'm going to watch this other video. So now I already think that they're doing something that's a breath of fresh air. And secondly, I like Sean and he's giving me advice and I trust him. And it's just logical for me to jump on a phone call with him. So now you're close rate goes up that you already have an authority and you don't have to worry about people who are not your perfect ideal client.
Sean [00:31:17] Cool. That's awesome.
Sean [00:31:27] What questions do you have for accounting here?
Aaron [00:31:29] Huh
Aaron [00:31:30] Well, that would have been one of my questions is because one of our employees wanted to say, hey, look, what do we have to have, like a satellite office? Do you really had to live over in Puerto Rico. So that actually has been a topic of conversation before. I think we'll go to Christian to. Mine is more so like what is the question we're not asking. So like, we save our receipts, we take pictures of that. We have all those and we write off pretty much. I mean, I feel like everything. What's something that is a common thing that most people you see don't write off that they should be writing off? I don't know. I think that's probably a question like I don't know for not asking the right question to know for doing the right stuff.
Sean [00:32:11] Right. So a two fold answer to that. So the first is actually related to why we do the business model the way we do. You should be asking that as the year is going as opposed to at tax time. So you come in a tax time and say, okay, here's all my stuff and here's what I want you to do and I want you guys to fill these forms out. By the way, the CPA is drowning in work by the time you show up with those forms. This is the misconception. And why the tagline, if we do what you wish your CPA would actually do when you drop your stuff off, you're assuming that your CPA is looking at over and going. All right. What else can I find for them? That's not what's happening. The CPA thinks their job is I got to get this in or I got to get it accurate and I gotta keep the price down to get it done as fast as possible. And that gap between those two expectations is pretty tremendous. But even if you do ask those questions at that time, your time machine probably doesn't work to make that expense occur back in. So you want to have those conversations as a relationship throughout the year. OK, here you talk with your CPA about this is what's going on. What should I be thinking about? Because if you're having that conversation right now, it's August. And we were sitting down and looking over your stuff and having a conversation about what we would want to know. Where are you going? What do you expect the rest of the year look like? What's next? You're going to look like what could you do? What do you want to accomplish? So that's the first part, is doing it concurrently throughout the year. So you don't miss it because when it's March, can't go back and create the expense. Now, a specific answer to your to your question is milage, cell phone. And actually, I'll do it the way I teach my classes. There's three categories of expenses that I'd say that there typically are. There's the category of expenses that there is no way you would have ever spent this stinking money had it not been for this business, that microphone and right in front of you, you would have never bought that had it not been for the business that you're in. That's a business deduction, right? It just is not the ordinary course of life. The second category is the stuff that you would have spent money on, which you really need them for business. That's what your cell phone, your laptop, your iPod, all those tools and things that you're spending money on, you probably would have had it had mileage on your car. How do we position that as business expenses? That's the stuff that people miss all the time. And I'm telling you, the number of times I miss mileage and cell phone. Cell phone twelve hundred dollar deduction mileage is usually anywhere between four to ten thousand dollars a deduction. Those two by themselves are constantly missed. The third category is the stuff where you kind of go.
Sean [00:34:43] Sean, how can I make this look like business expense? That's when you're going to Vegas. Sean, I really want to go to Vegas. Can I make that a business expense? There are ways to do it.
Sean [00:34:54] I own a Miss Pacman cocktail table machine that is a business expense because, by golly, it was in my lounge at my office for three years. Now, it might have got moved to storage because we needed that office for somebody else. Why did I do that? Well, it was cool for everybody to scream and yell about who has the high score. And it was really nice for everybody to go in and chill out and play. I bought it because I wanted it and I positioned it as a business expense, a legitimate business expense, because it was in there for use for the entire team. But it started with, I really want one of these Miss Pacman cocktail table machines that had 60 games at one. How do I make it a tax deduction? There's a way, there's a way to do it. But you don't push it so far because you get that old saying the pigs get fat and hogs get slaughtered. You got to know where that line is. And that's why your advice is going to be a really big deal for folks. And the one single biggest mistake, single biggest mistake, every business owner. I can't tell you the number of times we fix this and save tens of thousands for somebody. You have the wrong entity type. You just made the wrong choice. And. One of my central stories from last year. Sorry if I'm boring. The story on this, but this one was the slam dunk. In fact, you know, Larry West, Larry West works for me. Larry and I are sitting in a meeting with this prospect and he comes in and his whole point was he feels like he's wasting money. He's almost positive. He's wasting money. CPA doesn't ask any questions.
Sean [00:36:16] He hands us his tax return. And I look at his tax return and I go, oh, I turned to Larry, Larry. You think about that. What about fifty thousand? Yeah. What about this one? You think 50 or 100? He goes ooohh could be a hundred, but let's say 50, OK. That was the full extent of the conversation. And I'm not exaggerating. I pointed a line. It was so bad that Larry and I just immediately picked up. When we say fifty thousand. The two mistakes this guy was making could save him between a hundred and one hundred and fifty thousand dollars a year in taxes.
Aaron [00:36:52] What?
Sean [00:36:53] The first one, the fifty thousand was the wrong entity type. The second was a completely missed deduction opportunity. That's just easy because he makes so much money. Slam dunk, right? I mean, we look like heroes in five minutes. Here's the kicker. It's going to take some work to get things changed over and get it fixed. It was nearly ten thousand dollars worth of work to make everything get back on track one time, but ten thousand dollars. His response was, I've never paid ten thousand dollars for an accountant. I can't afford that. No, sir, you're going to save every year from here on out for as long as you have your business. A hundred thousand, maybe one hundred and fifty thousand. Just for these two changes we're going to recommend. You need to do this even if it's not us. Please call someone. No, that sounds like a lot of work.
Sean [00:37:49] That was 12 months ago. That was last summer, and we checked in with him and his response at the end of the year. This is this truly happens. I wish it didn't because it bugs me. It bugs me because I knew we could help this guy. If you've not noticed from our conversation, helping people is a big deal. He got to the end of the year and like, look, man, you need to make these changes. I can't, I mean, you're literally throwing ten thousand dollars a month in a hole because you're missing these opportunities. And his reply was, make quite a bit of money. It's not like I need the other hundred thousand.
Aaron [00:38:21] What? Yeah.
Sean [00:38:24] Imagine how much good you could do in the world with one hundred thousand dollars you don't need. You could hire people, you could hire two people, pay them fifty thousand dollars a year, send the elevator back down and give them a shot at life. Right. Give them 50 K. You can donate to charity. You could do a million different things over the course of ten years. This guy could make a million dollar impact on people's lives. And his response was no, paperwork. I can't fix that, but the thing is, is we have this happen all the time. He's one of the examples where it frustrated us that we couldn't help him because he wouldn't let us help him. But it started with. He had the wrong entity type. And normally we're saving five and ten thousand a year because of the entity type. This was a little bit bigger number, but it's so common as just to be silly. We'll walk in and go. Alright, we know the first change is right there. There's ten thousand bucks for you. And if it happens, I would say if it doesn't happen less than twice a week, I'd be more than twice a week. I'd be shocked. I have enough prospect meetings every single week that we'll look at it. OK, we're going to fix that. And then everything else is gravy. We basically pay for ourselves. I would say pay for let's be conservative. We pay for 50 percent of our services, usually in the first one or two things that we do most of the time that we tell people that it's time to hire us. Now, we do tell people not to hire sometimes. Sometimes we can't help. If you make 10 bucks a year and it's a side business and all you do is, I don't know, you sell sticky notes and you make ten dollars a taxable income a year. I'm not going to be able to help too much because our fees are are not commensurate with saving you money on ten dollars, but a couple of hundred thousand dollars. There's a lot of opportunity hiding in that. So I gave you a long answer to your question, but it starts with plan as the year goes on. Communicate with that CPA. But the more realistic things that people screw up is they miss the basic deductions like mileage and cell phones. And they completely screw up their entity type, which immediately sets the foundation wrong.
Christian [00:40:28] Yeah. We need to sit down with you and check over everything.
Sean [00:40:35] So come on in. We're happy to help.
Aaron [00:40:38] He's gonna get us in there and we're gonna be like, no, we're not doing this. It sounds like too much money to save.
Sean [00:40:44] I don't need those stinking money.
Aaron [00:40:46] Yeah, just keep it please. Keep giving it to the government. Yes.
Sean [00:40:52] But they do spend it so well.
Sean [00:40:54] I mean, they're very efficient on how they spend your money. So, I mean, of course we.
Aaron [00:40:58] Oh yeah. Let's just keep giving it to. Yeah. They know my better. They know our money better than us. So I mean, it makes sense. All right. So these are gonna get into some tougher questions. So if you do anything to prepare yourself. There you go, pkay. If that's all coffee, that is impressive.
Sean [00:41:18] It's not coffee, but it's an energy drink. Same thing.
Aaron [00:41:21] OK.
Sean [00:41:21] That's after I spike it with this stuff.
Aaron [00:41:25] I was going to say one of the questions was gonna be, what do you attribute your success? But I think we can move on. And I think you just answered right there. Right?
Sean [00:41:32] Where do I attriibute? You know, I actually I love that question because I've had it. I had a college kid ask me this a few months ago. It is, I hate to say, just shut stubborn. Sheer stubbornness is its effort, its work. I went to college with some guys that are so much smarter than I am. I mean, there's you just meet them. You've met those people, they're just brilliant. But they didn't get anywhere because they rested on the lowers. And I knew that I had to work. It's not. And by the way, there's a misconception of the term called Hustle. Everybody talks about their hustle and how they're going to work, and they think that work is 14 hour or 16 hour days. That's not my mission. If I start working 14 hour days, I'm not seeing those kids that I turn the FBI down for. But it's when you work, work with intention, figure out the plan, execute the plan. If the plan has to change is totally cool. But when I decide to do something, I will absolutely do that. I refuse to fail. I just passed the securities license. I'm forty seven years old and I had to go study for another stinking test. But the securities license made us better at the family office. So I needed to do it and I just I'm going to do it. So stubbornness really pays off when I say I'm going to. I honor my commitment.
Aaron [00:42:53] It's a miracle.
Christian [00:42:54] Excellent question. Excellent answer. So here's another one.
Christian [00:42:58] In the last five years, what's a new belief, behavior or habit that has most improve your life?
Sean [00:43:05] Whoo! Low carb diet.
Sean [00:43:11] I know that sounds really dumb, actually. There's all this other research saying that's not healthy. I went back in the funny story with this is back in two thousand. Shall we say it's 15 or 16 whenever we went to Thailand. So we're going to go to Thailand. My wife pointed out that we were going to be on the beach. And when she pointed that out, I understood what she meant. She didn't want me to get harpoon. So she challenged me with this, the low carb diet thing. And so for two and a half months. And by the way, anybody that knows me knows I am a massive sugar fing. I have literally wrote for Lifestyle Frisco an article on desserts. People that we all know know that if they want to talk about desserts, I'm your guy. But I love my sweets. So when I, my wife challenged me on this diet. It was probably the hardest possible thing that I'd ever done. But for two and a half months, no carbs, no sugar, no dairy. I dropped twenty five pounds and I was forty forty five years old. Forty three years old.
Sean [00:44:11] And I had a six pack for the first time in my entire life. And I remember looking back, going what in the world. And so that led to or just a general feeling of healthier.
Sean [00:44:23] I was I was leaner. I was just felt better. And when I felt better business, execution, life, kids, everything was just more positive.
Aaron [00:44:35] And it's crazy, too, because a lot of people think they're like, oh, you get to a certain age and then, you know, it's just you're gonna be sore, you're gonna go downhill.
Aaron [00:44:42] Like, you can't really progress. It's just like. Alright as you get older, this is just the things that happen. You kind of flipped it on its head, which is really awesome.
Sean [00:44:50] I'm going to fight it kicking and screaming because I got to hold on until they can upload me to the robot.
Aaron [00:44:55] There we go.
Aaron [00:44:57] Which you and your wife or maybe your wife doesn't want. What would your current Netflix binge right now?
Sean [00:45:05] Oh, we're actually finishing up Watchmen.
[00:45:09] So I did the Watchmen on it's on HBO. It's actually well it's HBO, not Netflix. So I guess it kind of it's either still cinematic or series related shows. I am trying to think. Well, my kids have watched Parks and Rec now. I think they're on the third watch through. So.
Aaron [00:45:25] Nice.
Sean [00:45:25] Yes. Yeah.
Sean [00:45:26] If I hear another mouse rat song, I don't know if I'm going to make it. I really don't.
Aaron [00:45:30] You don't like mouse rat? Are you kidding me, Sean. Wow.
Sean [00:45:35] Actually, I bought my wife a mouse rat shirt and I have a pawnee festival shirt. So, you know, little Sebastian and I are big buddies.
Aaron [00:45:41] I was going to say Little Sebastian, man.
Sean [00:45:44] Yeah.
Aaron [00:45:44] I still miss that guy. I recently started watching that. Well, it's been about a year now. So like throughout my wife's pregnancy, I watched that whole show and then my daughter was born. But it's just like the last show that I'll ever watch without having a daughter. And I was just like, I love Parks and Rec. I just never was like, I don't know. It came up when I was there. I was in college. I just don't think I was mature enough to watch it, even though Parks and Rec is definitely, like, not mature. I just seemed like it was way too advanced or whatever. But it's such a good show.
Sean [00:46:15] Oh, yeah. Well, of course I love Mandalorian, which is not Netflix, but go back and watch community if you haven't watched community. That was fun to rewatched with Donald Glover and everybody in it. My kids. It was funny as we watched Community and then on purpose I put in Han Solo the solo story and they realize it. Lando Calrissian with Donald Glover and then they make their heads exploded.
Aaron [00:46:38] Wow. Yeah. Community is about community college, right?
Sean [00:46:41] Yeah.
Sean [00:46:42] Okay. Yeah.
Sean [00:46:43] Because of Donald Glover then we showed her. This is America and she's nine by the way, this is America's video. Not appropriate for a nine year old, but we're really bad parents sometimes. And so now my daughter has declared starting school year. She holds the black up of all our favorite stuff. Her favorite song is This is America.
Aaron [00:46:59] Oh, gosh. Yeah.
Sean [00:47:02] And she knows what it means it's not just because of the beat. We actually had the conversation because right now that's obviously a whole different topic of conversation, just what's going on in our world. But, you know, my daughter's favorite song is This Is America, because community introduced her to Donald Glover and he's Lando Calrissian. And what the heck? He also sings.
Aaron [00:47:21] I know. Which is even. Yeah, even more impressive. Says, like, who the heck is this guy anyway? I didn't know he was in community, so I might check that out.
Sean [00:47:30] Yep.
Aaron [00:47:34] I Think, Oh, this is a good question for you. I'm actually curious because I feel like you have you definitely an answer to this? Well, it's a purchase of one hundred dollars or less that has most positively impacted your life in the last, I would say, six months or years?
Sean [00:47:48] Hundred dollars or less. I was waiting for you to say one hundred dollars or more.
Sean [00:47:52] And then I was gonna grab one of those. Hundred dollars or less? You know what, I'm gonna go with a non purchase because it's free, but I got tell you, changed my life. Cheap DFW. Have you heard of the website? Cheap DFW?
Aaron [00:48:12] No. What's it?
Sean [00:48:15] Cheap DFW is a Websites. It is on Facebook, you can sign up on Telegram's. It's got a Website. They post out when deals pop up with airlines. And the reason I point this out, last year, three trips I booked because of cheap DFW. We went to Hawaii for two hundred and seventy dollars a person roundtrip airfare. We went to St. Croix eighty dollars a person roundtrip. And we went to Orlando for ninety dollars roundtrip per person. And also assuming Auckland doesn't have another outbreak. We're going to New Zealand this November for three hundred and seventy dollars a person roundtrip.
Aaron [00:48:50] Wow. Cheap DFW. Nobody else get onto that side. I don't want anybody else to mess it of it.
Sean [00:48:56] Yeah, but it so it wasn't actually the purchase itself. It led to purchase. But the fact that we track it. My man, I have taken trips, I've taken trips I had no intention of taking. I had no intention of going to New Zealand this year. This year was actually supposed to be China. Odd timing, I know, but that was the original plan. Things have changed a little bit, but St. Croix was just on a whim. My wife went, holy crap. And she told me, by the way, we're going to St. Croix. And they. OK. And then she showed me what I for 80 bucks a ticket, of course, we're going to say. Right.
Christian [00:49:27] Yeah golly.
Aaron [00:49:29] That is crazy. I mean, I'm going to get on that, like, right after this call.
Sean [00:49:33] Yeah.
Sean [00:49:34] Oh, just log through telegram, you'll get the faster updates.
Aaron [00:49:38] Telegram?
Sean [00:49:38] Telegram. It's an app. It's like a texting app. Well you see, you got another thing? Totally free. It's basically just a notification.
Sean [00:49:45] Texting message board app. But they'll send them to their faster than they would on Facebook.
Aaron [00:49:51] OK. Good to know. OK. And I'm assuming that their whole model. We can talk offline or whatever, but it's just that there's only a limited amount of those. Which is why there's such great deals.
Sean [00:50:01] Yep.
Sean [00:50:02] Yep. And actually they don't necessarily. But I think they get more of their money from Patriot Patrion and whatever what I'm going to call it, people subscribe to their different levels and tiers, but they don't get a kickback from the airlines. They just are notifying you, Is the least that's the way it seems. I don't know. They're not a client, so I can't dig into the model.
Aaron [00:50:21] Awesome. Thanks so much, Sean. How can our audience find out more about you? What's the best place for them to connect? And how can they reach out to you about your new model for consulting for businesses?
Sean [00:50:33] Sure! Our Website is SMD accounting dot com. So that's always the easiest way. Is you hit us on the website. Of course, there's Facebook so SMD consulting and accounting in Facebook is a great way to reach us as well. Email is info at SMD accounting dot com and then they can always call at 469 252 4547. We do a one hour, no charge. So if somebody just says, look, I got a business and I got questions. Bring it on. I've had meetings that we've got into the meeting and we're asking lots of questions. And then that of course leads to engage because we've got to do a bunch of stuff. I've had plenty of meetings where I give them two or three answers and go, and you're cool. In fact, actually, this afternoon on my presentation for a proposal to a client is going to be our prospect is let's wait three months. There's no need to pay us yet. What you've got going on. We will help you with value. I think you need a few more months and then we'll decide before the year ends. Sometimes it just means here's the advice. Good luck. Call me in three years. And I have truly had people call me back in two or three years. This is when it's time to hire us and our specialties, the niches that we've developed. Real estate investors like crazy, medical practitioners typically when they have three or fewer owners in a business. I mean, we do tons of work with them and then service based professionals and service based is everything right? It's I.T. consulting, It's marketing consulting. It's that service based professional that doesn't understand what they can and can't write off and then doesn't understand how to build the wealth. That's a big part of it. And then we have those people that are successful, like this dude that didn't want his hundred thousand dollars a year. I mean, that he clearly makes good money, right? I mean, if you could throw one hundred thousand dollars a year at home, you're obviously doing well. What could you do with your entire plan? That's where it gets a lot of fun, but we don't know until we meet ypu. And that's why we just say, let's just have a meeting. Figure out how we can help people out. And it has been working really well and reaching out to the audience and helping people with their situations.
Aaron [00:52:34] Awesome. Thanks so much, Sean, we appreciate you coming on here. Really good to chat with you.
Sean [00:52:39] Appreciate it, man. It was a lot of fun.
Narrator [00:52:41] The Narketing Natives podcast is a production of BitBranding.