Partner Jerry Paskowitz, Sloan Group’s resident expert on business growth opportunities, talks frankly about business failure, the keys to business success, and what wealthy people do right with their money.
What can we learn from your wealthy clients? What are they doing right?
They’re planning. They’re looking down the road. Here’s an example. What makes great architecture different from so-so architecture? What makes you look at one building and go ‘wow’ and another one and you go ‘meh’? The great architect pulled up a chair into an empty lot and saw the building that wasn’t there. They saw the environment, land, surroundings and visualized the building. They had vision and they translated it into something that could be built.
What makes a successful business owner?
Business owners who are successful also have vision. They look at either what they have, or what they don’t have, and know what they want. They have a plan to create that vision. It’s then about making it happen. If you don’t have a plan, you have no idea how to make decisions that can help you reach your end goal or realize your vision.
What businesses are most likely to succeed?
Businesses that can identify a discernible need have the greatest chance of finding success. It’s not industry dependent. Deciding that you have a talent and thinking, “Gee, I have a talent, let’s make some money,” isn’t going to work. If no one wants that talent, you won’t make any money. Remember the 1957 Ford Edsel, and why it failed? It was because Ford Motor Company decided they had a car they wanted to put on the market and nobody wanted it. Businesses that succeed figure out what people want or need and create products and services that meet those needs.
What’s the key to early business success for a start-up and why do you think most new businesses fail?
First, you need a financial safety net. You have to plan and anticipate the worst case scenario. If you have $10,000 and you need a used car, do you spend it all on the car? No. You’ll need some money for maintenance and other unforeseeable costs.
Businesses often fail because they’re undercapitalized. When you start a business on a shoestring, you don’t have enough money for the first pothole. People who go into business on a shoestring are just asking to fail. You need that safety net. You have to wake up and say ‘failure is not an option.’ The reason you know that is that you built in the contingencies. You should always have a plan and enough money to cover the unexpected.
What’s important to know about tax filing, and what are common mistakes people make?
People often make mistakes in improper documentation and by not taking into account all of the availability within certain legislation. But that’s not unrecoverable. The Harmonized Sales Tax (HST) is a big issue that I’m seeing more and more of these days. If you don’t plan and budget properly, by the time tax season comes around, you may owe the government, and may not have the money because you’ve already spent it.
The person in their kitchen banging out their returns on TurboTax doesn’t necessarily know that there’s a tax rate change, and if they do know, they may not know what it means as far as how much money you’re supposed to get back. It’s not cookie cutter. It’s important for me to know all the ways to get the best refund for my clients and what is best for them tax-wise for the long run.
We hear you’re an avid photographer. What made you decide to take up photography?
When I found I understood how to do it. It gives me great joy. (Check out Jerry’s photography and artwork at www.fotomacher.ca)
What’s the craziest shoot you’ve done?
A couple of years ago I went to the Leaside Bridge in a thunderstorm. I wanted to get some interesting shots of lightning hitting some buildings downtown. At 10:30 p.m., after I had everything set up and covered so I wouldn’t get soaked, there was some lightning over my head and the sky lit up like it was noon. You can usually tell how far away the centre of the storm is by how long it takes to hear the thunder after you see the lightning. Then the thunder struck right over my head and the bridge shook. I got the hell out of there fast!
Share something about your family
I’ve very proud of all of my family. I never had any specific career objectives for them. My only advice to them was that whatever it was they decided to do, that they should decide. You have to put yourself in a place where you choose your opportunities. I think they all heard me. I think they all accomplished exactly that.
Jerry Paskowitz is a Partner with Sloan Partners, with over 30 years’ experience in all tax and financial matters. Contact Jerry for an appointment to discuss tax savings opportunities and financial strategy for your business.