Business Innovators Radio - Interview with David Flores Wilson, Managing Partner at Sincerus Advisory

Episode Date: July 3, 2025

David Flores Wilson, CFA, CFP®, CEPA®, Co-Founder and Managing Partner at Sincerus Advisory, advises entrepreneurs and business owners in New York City on personal financial planning issues from formation to exit and beyond. A multiple-time Investopedia Top 100 Financial Advisor, his financial guidance has appeared on CNBC, Yahoo!Finance, the New York Times, US News & World Report, and InvestmentNews. David represented Guam in the 1996 Atlanta Olympic Games, sits on the Board of Directors as Treasurer for the Lower East Side Girls Club, and is active with Entrepreneur’s Organization, the Estate Planning Council of New York City, Advisors in Philanthropy (AiP), and the Exit Planning Institute.Learn more: https://sincerusadv.com/Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-david-flores-wilson-managing-partner-at-sincerus-advisory

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have with this David Flores Wilson, who's a managing partner at Sinceris Advisory. David, welcome to the program. Thanks so much, Mike. Looking forward to the conversation.

Yeah, I want to dive into what you do and how you do it, but get it started first with a little bit of your story and background. How did you get into the financial services industry? Sure, yeah, in terms of my origin story, you know, I sort of kind of grew up in it. You know, my dad was a CPA and, you know, got little sort of bits of financial literacy at the dinner table. I mean, you know, just wasn't that intention. but, you know, and then, you know, I sort of also had this sort of entrepreneurial journey as well. I was kind of trading comic books in the neighborhood and trying to find pricings, mispricings to arbitrage, different pricings. And so I think that's, you know, kind of set me off on my journey.

I had an investment banking career for about eight years out of college. And I started to just do a little bit of financial planning for friends and family that would, you know, just ask me different questions. you know, and so I, you know, the red versus buy spreadsheet I had, developed, it kind of went around the office and people were asking me what to do with their 401Ks. And so, you know, eventually I decided to make that, you know, that hobby my career and, you know, transition from investment banking to wealth management and then opened up this firm about five years ago during COVID. You know, it's interesting, you know, kids can pick up so much at the dinner table. you said. You know, I've found that I'm in marketing and consulting and my kids pick up things and none of them are in business or anything related to me, but they'll pick up these nuances. So I find that that is so neat. And it's really powerful, though, to take that same concept

and we need to be teaching our clients like you, I'm sure, teach your clients, hey, look, once you get financial principles dialed in, that needs to be passed on to the next generation and the next generation because I feel like too many times people would say, yeah, I've got that figured out. Oh, I know how to do that. And oh, my kids will be fine. But what if they're not?

What do you do to make sure that you're teaching your clients to keep that legacy being passed on? Yeah, essentially that you say that, Mike, because we work with a fair number of, you know, multi-generational family businesses. And so, and, you know, these owners oftentimes, not every time, but they want to, you know, transition that business potentially to the next generation and you know kind of get them ready and mentor them and you know what we often say is like you know well you know the kids are sort of watching and listening right so when you're coming home from the business sort of stressed out and tired and kind of complaining about the market and you know and then you sort of turn around 15 20 years

later and you want them to join the family business it's no surprise they might have some hesitation Right? And so if they can be intentional about, you know, imparting the knowledge that they have to that next generation around that family business and the learnings that they've had in a measured way, you know, talking about the industry and the pros and the cons and the benefits of entrepreneurship and so that they can, you know, the kids can one day, you know, come into the family business if it's mutually beneficial.

And so, but to speak more generally about financial literacy, I think that financial planning for entrepreneurs and business owners, which I primarily work with, is a little bit different, right? And I think that, you know, I think a lot of our industry sort of says, hey, you know, you have this concentrated asset in your business and you need to diversify and, you know, put a bunch of money in a cash balance plan or profit sharing plan. And oftentimes I'm like, let's hold up. Let's hold up.

Let's find out what the real rate of return is in the business. And if it's more attractive than what we can get outside in a diversified portfolio, well, then let's reinvest. But let's just know, you know, what's the return on investment when it comes to buying that extra piece of equipment or, you know, hiring a couple other people in the business and so that we can be very intentional about growing that business and making it a more valuable business and potentially, you know, doing exit planning related to that business years in advance of any potential, you know, exit or sale or transition.

Yeah, that's a huge point. And I'm confident that we could cover a three-day weekend seminar and still not be, you know, scraps at the surface of exit planning and financial strategies for business owners and that kind of thing. But talk a little bit about the power of planning early, starting early. When you talk to a business owner and you say, you know, hey, we need to make sure your ducks in a row or your exit planning strategies in place. How early is early? Yeah, my view is there are elements of exit planning that should be explored and discussed

as early as when the business is formed, right? I think that, you know, and assure, you know, the vast majority of our clients are not going to exit, you know, in the next sort of six to 12 months. But there's things they could be doing in the business. on the personal side and as well as on their financials, that could be helpful and give them options and flexibility. As well, like, you know, make a more valuable business when that time actually comes, right? And so you think about just when you're forming the business, right?

Is this a business that's a fast-growing business that you might need, you know, potentially a large capital gains exemption, you know, by making it a C-Corp and qualifying for you know, what's called qualified small business stock, which has a $10 million capital union exemption, or, you know, potentially you might run some losses

in the business early. And so, you know, an LLC tax as a partnership might make more sense. And so just being intentional kind of every step of the way from formation to growth to, you know,

when that exit is a little more, more tangible, right? I think can be, super helpful, especially because, you know, there's lots of misconceptions about, you know, valuation and what business owners' options are. And so, you know, when it comes to sort of exit planning, you know, it really is, you know, their goals in the stakeholders that they impact and what they're really trying to accomplish should lead, right? And so if they want to create a legacy, well, you know, I think that, you know, selling to the highest bidder in a private equity transaction,

won't make a lot of sense because the brand will be eliminated. You know, there will be some, there'll be impact on the community that they serve. And so, you know, maybe they want to explore other options like an ESOP or a management buyout. And so it takes sort of years to tease out those kind of different options and weigh the pros and cons and really understand the structures. And so, you know, we recommend the business owner start early. And it's so overwhelming, I think, when it comes to exit planning that, you know, just taking it one step at a time, you know, very, uh, digestible, you know, uh, little sort of, you know, maybe 90 day sprints on sort of some of these different topics and kind of going

from there makes a lot of sense. Reminds me of the, uh, the book, the 12 week year and also, uh, built to sell. Have you read either one of those? Yeah. I have. Um, of course, uh, the, uh, the 12 week year more recently. And it's kind of, actually, it's been recommending that to a few of a few of a few clients because it's an amazing framework in that book, right, in terms of saying, hey, like, we always think about the year in terms of cycles and, you know, why is that, right? Let's flip down its head and say, hey, like, what can we accomplish in the next 12 weeks?

And then, you know, and then pivot and start again in sort of the next 12 weeks after that. And so, you know, kind of then waiting for the fluctuations in the calendar. And let's make the calendar work for us. Yeah. And it gets down to what you're saying, too, about exit planning where, you know, you need to have a basic idea of just like a pre-retiree couple. Hey, what does retirement look like to you? And same with the business owner. Hey, what does exit planning look like to you?

Do you want to just get a big check and walk out? Do you want to, there's many options like what you were saying. And similar to the book, Bill to Sell, where that fictional story is like the, you know, the guy's like, I'm so fed up. I just want to sell my business. But the advisor helps him. get operationally tight and marketing tight and branding and all of that and come to find out maybe he got a little bit more money because he tightened it up or maybe he didn't sell it as soon as he thought and i would venture to say one of the conversations you have with your entrepreneur

clients would be well what do you want you know like if you're going to retire at age whatever and sell the business is that all you're going to do and maybe you find a business owner that says, I would be bored to tears if I just cashed out. So I really like that idea you're bringing up of, you know, maybe the ESOP or maybe, you know, hey, why don't you stay on board as a, you know, a consultant for a few years? And then that really keeps things. So what are some of those perspectives that you bring to your client's attention when you start planning early so that they could be working toward that in those, you know, blocks of sprints. Yeah, you really keyed on something so important.

You know, business owners are, they're pulled in so many different directions, right? And there isn't a lot of time. But, and so oftentimes we see people exit their businesses without doing sort of the work on the personal side. And, you know, there's all sorts of stats out there. You know, X number of business owners, whether it's, you know, somewhere between 70, 80 percent, regret the sale, you know, sort of 12 months later. And for us, we really want to just attack this issue from a lot of different ways, right?

We think that you've had a successful transition when you already know what the purpose and identity that you'll have, as well as the activities that you'll do day to day in your sort of post-exit life will be. And so, you know, just going through all sorts of exercises and say, okay, well, let's go through a model week, right? You say that, you know, you want to spend a lot of time on the tennis court and with your grandkids. But what about the other hundred hours a week that you're going to be awake, right? And how are you spending that time? And I think that you're just going, you know, eyes white open on some of these things and say, okay, well, you know, some people are like, well, I want to spend more time in the community.

I want to do some angel investing. I want to do consulting for that next generation of founder. But just know that, you know, that may not go perfect. as well, right? You know, many ageal investments don't work out in terms of, you know, financially, you know, they could be doing consulting and then all of a sudden, you know, like, you know, how are they going to feel when their, you know, their advice is not heated and they're not implementing some of the suggestions that they've given to those founders. And as well, you know, if they don't find the right board, potentially that they want to participate with, you know, many nonprofits, you know,

might just see that person just as a check, right? And it's not as, fulfilling, right? And so there needs to be some experimentation and sometimes, you know, just finding the time to do that a little bit before the actual transition so that they know for sure that this is something that's going to be fulfilling and give the meeting and occupy their time in a way that's, you know, that's impactful for them. Yeah. And I think that if you were to ask a hundred people, you know, hey, well, what do you feel like retirement would be or what do you want out of life? I think you'd get a big percentage that go, I don't know. You know, so I think that when you're sitting down with a business center going, you know, let's talk about the end.

It kind of, you know, freaks them out a little bit to go, we just launched or we're only five years in. But to talk about the end, well, just like we know from Stephen Covey teaching, you need to begin with the end in mind. So having those conversations early on and then checking in and just double checking, making sure all those places, those, you know, timeline touchpoints are in place. So talk a little bit about some of those main points that you're making sure you mentioned business valuation. Is it that like the starting point? Like, well, what's the business worth now?

Because if a business owner said, oh, it's worth $5 million, but actual valuation comes in and says it's worth half that, you've got to get some perspectives on the same page, right? Yeah, I think that because it's such a cost. common issue, right, that there's a little bit of a value gap between, you know, what people think their business is worth and what the sort of market at that point in time is willing to pay for, right? And I think as well, oftentimes business owners don't really know what their expense level is, right? So just, you're just going and flushing some of those things out on the front end and assessing their sort of readiness. Okay, well, like, how much you actually spending,

you know, that's kind of go through the financials? You're, you know, you're running the company car through the business. some vacations, you know, sort of quasi-business, and then just really getting a true number, and then also getting a real valuation number as well for the business. And then, you know, if they're sort of saying, hey, well, you know, like you need a higher number to support that expense level once you transition out of the business, well, then the next step is okay, well, how do we get there, right? You know, is there ways that we can get a higher valuation because we've increased even

done over time or we may have a higher percentage of recurring revenue versus project-based revenue, you know, implementing systems and processes and making the business less dependent on the owner. Like all these things can be done, but it takes time, right? So I think what, you know, that first step is just really just an assessment, you know, from the personal perspective from the financials perspective. And then, of course, you know, where is the business? Is it a saleable business?

And, you know, and then going from there and saying, okay, well, let's kind of chip away at some of these areas of improvement. And, you know, with the goal to make a more valuable business and then to be ready if there is a transition. And to give, you know, to have those options and flexibility. And then, of course, you know, because I think one thing that happens a lot is when, you know, a sale or transition is imminent. Well, then, you know, people are going to kind of come out of the woodwork, right? and say, hey, maybe you should do this structure that's going to save some taxes or, you know, here's some way that we can structure the deal. And so there's just a limited time when that, when the transaction is about to occur,

that the business owner should be well versed, right, in terms of like, okay, well, you're going to go in PE. Let's understand earnouts. Let's understand, you know, asset sales versus stock sales. Let's understand the different charitable structures that might be helpful in mitigating. taxes and, you know, different things sort of like, you know, selling up front or taking a note and kind of all these different things. It can be so overwhelming. But if you kind of just, you chip away it one thing at a time, you know, we've seen owners get up to speed and, you know, they eventually they can teach this, right, once they go through that transition. You know, it sounds to me like

when you think of, you know, the term financial planning, you know, for a retiree or a pre-retiree, you think, you know, hey, let's look at stock bonds, mutual funds, annuities, permanent life insurance, all these things that, you know, make up your financial picture. What percentages should they be allocated? The same thing goes into financial planning for an entrepreneur business owner because they are individuals as well as a business owner. So there should be some financial planning strategies put in place on the business side of things, but also at the same time, I would suspect that the owner, the husband or wife of the business owner, they need to be thinking of, okay, well, if we do this financial strategy for the business side of things, how is that going

to impact us on the personal side of things, too, right? Absolutely, right? Because I think that, and, you know, that's where I think entrepreneurs really need to be, you know, very judicious when they're sort of building their team, right? And sort of, you know, their attorneys going to sort of say, hey, like, you know, this structure and these documents and, you know, this is what's going to help, you know, move the transaction forward and it's what's best for the business. But oftentimes, you know, oftentimes what's good for the business may not be what's best for actually that,

that owner at the individual level, right? And so in real time, you know, when sort of deals are moving back and forth and there's negotiations, you know, as sort of like, you know, whether it's the terms of an earn out or, you know, how much they're going to do as a seller note or, you know, what the headline price of the sale is going to be. You know, they sort of need to be working with their CPA and financial planner. It's in real time to say, okay, well, you know, what does that mean on an after-tax basis for them and their goals and how much risk is that for them at the personal level? And so, you know, just looking at it from a couple of different perspectives, just makes

a lot of sense because I think that it can be overwhelming, but I think that if they have the right team in place, it can get done and you can optimize outcomes. And I think keyword their team and then going for the right team. And also, you know, that that also means don't just hear, oh, I should put an exit plan into place. Let me go Google that or let me go chat GPT that. So you can get a lot of information online about a lot of different things, but you need to make sure that you're putting the right in place with the right team because I think that too many times we all think, oh, easy fix, boom, boom, done. So once you put an exit plan in place with a business owner, how often are you recommending

to revisit that and just make sure that it's working and performing the way that it should because I think that, you know, maybe if you're 10, 15 years out from an exit, do you need to be revisiting every six to 12 months? But what is the frequency that you recommend? Yeah, so I think it's interesting though there's a business owner, a couple actually running an education business in the South. And they wanted to put together an exit plan and they have no intention of selling the business anytime soon. And so they just were concerned, right? You know, they have some that if something happened to the health wise, they wanted a document that they can present to, you know, now they have adult children that don't live in.

town, you know, that they could just, you know, almost a manual for them to say, okay, well, this is, this was what needs to happen, for example, right, in terms of this contingency around, you know, them not being in the business anymore. And so, you know, that, in that situation like that, where, you know, they might be 10, 15 years away, you know, we can revisit portions of the plan every year. It doesn't need to sort of, you know, be, uh, uh, re, uh, re, re, it doesn't be redone sort of every year, but portions of it when say, hey, look, you know,

the estate planning portion of this might have changed a little bit, right? Because, you know, given, you know, potential changes in the estate planning tax exemption level, and so as the business grows and they kind of cross over into potentially paying an estate tax, well, then, yeah, like we need to address sort of that first, right? Or, you know, we'll get their sort of team on board to say, okay, well, you know, you had a bunch of coverages on the insurance side.

Well, now you're, you know, you can be self-insured in a lot of ways. You know, maybe it doesn't make sense. For example, to have as much, to be paying as much in premium on certain coverages. And so, you know, I think just those regular conversations and, you know, talking about the business, talking about taxes, talking about retirement, talking about the next generation, real estate, terrible giving. You know, there's always something to discuss.

and ways to kind of tweak the plan. But I think that's, you know, just even having sort of check-in conversations every quarter can be helpful in terms of, you know, what we would focus on. But, you know, you don't need sort of to redo the plan every year for sure. Yeah, yeah, yeah, just make sure it's heading in the right direction. Excellent. Well, I tell you, this has been really helpful to get that 30,000-foot view perspective, David, on how business owners and entrepreneurs should be having that kind of end-eastern. in sight with an exit plan and putting some financial strategies in place. So if someone is interested in seeing what that would look like for them, what's the best way that they can learn a little

bit more and then also reach out and connect with you? Yeah, if they just Google David Flores Wilson, you know, they can set up a time to chat through the website or even check out the blog, which has, you know, content focused on financial planning for business owners. Excellent. Well, thank you so much for coming on. It's been a real pleasure chatting with you today. Great channel. Mike. Take care.

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