Developing an Entrepreneurial Mindset with Startup Founder, Bryan Gardner
We spoke with entrepreneur Bryan Gardner and learned the ins and outs of starting your own business.
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Bryan Gardner is 33 years old and lives outside Denver. He has a wife, two kids, a house, a Tesla, a camper van he uses for regular mountain-biking or snowboarding trips, and his pick of four vacation residences in Breckenridge and Taos that he likes to let friends use.
You could rightly say that Bryan has it all.
But Bryan hasn’t always had so many toys, much less a seven-figure net worth. Bryan never inherited a trust fund. He wasn’t handed the keys to a chocolate factory by an eccentric millionaire. He never attended private school.
When Bryan went to college, he got degrees in finance and accounting. He got a degree in tax and soon landed an entry-level job with a small regional accounting firm. Over the next 10 years he managed to:
- Found, fund, and exit three successful businesses
- Start four digital businesses that have each grossed five- or six figures monthly
- Started his own consultancy
Of course, he’d eagerly point out to you that along the way he also managed to:
- Spend three years snowboarding and making no money
- Watch three promising small businesses fail to get off the ground
- Sell two businesses way too soon
- Lose six figures of his own money—twice—on failed ventures
Along the way, Bryan has learned a lot about conceptualizing, starting, scaling, and exiting small businesses. We spoke with Bryan about key insights for aspiring entrepreneurs.
Coming up with a big entrepreneurial idea
How did you come up with the concepts for your first companies?
As with many small business ideas, necessity is the mother of invention, and I was either trying to solve a problem that I personally had within a business or hobby in my life, or identified a common yet solvable problem that others in my network were having.
Setting up a business
What is the single biggest thing that you think people need to be aware of when setting up their company?
This is a bit of a difficult question to answer since it really depends on the type of company being discussed. But, I’d say for most people that approach me on these issues, they get ahead of themselves too quickly; setting up C-Corps or tax structures before the product is even ready for production or has any real expenses, revenue, or promise of market viability. With that said, if revenue/expenses are a certainty, I’d advise people to always council a CPA who is knowledgeable with startups in their particular field. Don’t get your tax advice from the internet, because everyone’s circumstances are different.
What is the biggest tax issue that most people don't know/think about?
Probably self-employment tax - which is currently 15.3%. This means that every dollar you intend to claim as profit or paying yourself is taxed at 15.3% right off the bat, and that is in addition to your standard federal and state income tax liability. To put this in perspective, my first company to reach over $500,000 in profits, I took home nearly half of that amount after taxes. Nothing to complain about, but certainly came as a massive shock to me as someone who had never made that much before and could have easily foregone budgeting for that expense without serious strategic planning from my CPA.
Which 3 things should people absolutely make sure they do when setting up a new company?
1. Consult a CPA. 2. Make sure all partners in the company have formal operating and ownership agreements in place. I cannot stress this enough, it’s critical to get all agreements in writing before you start generating revenue. 3. Determine any county/city/state tax or license requirements - every city and state are different and there may be special requirements.
How might someone tell if they're being taken advantage of by a CPA or being offered services they don't need?
I really think that a lot of choosing the right person comes down to a mix of high level online research, common sense, and ability to judge character. Always pay a CPA on an hourly fee basis. A “reasonable” fee completely depends on the complexity of the business. I have three great CPAs for various entities that I own that range from $110/hour to $450/hour so it really just depends on the operations of the business and the level of expertise required to prepare returns, be smart about tax planning, research possible new tax laws that could affect you, etc. It should also be noted that bookkeeping is an entirely separate service from tax planning and tax return preparation and filing. Personally, I only oversee my own bookkeeping when a business is small or being bootstrapped. Once it’s profitable, I usually hire out bookkeeping to a CPA, which 99% of the time is just using a software like Xero/Quickbooks which most people can learn fairly easily.
You’ve used crowdfunding for some of your companies—something that a lot of aspiring entrepreneurs think about using nowadays. How well does crowdfunding work in your experience?
Fly Pedals became successful from Kickstarter campaigns. That was my second successful Kickstarter campaign (I eventually had four successful campaigns in total). The success of Kickstarters are largely fueled by organic word-of-mouth referrals. People love sharing kickstarter campaigns to their friends on social media, which is not only free advertising, but more importantly higher quality advertising because word-of mouth referral traffic is 7X more likely to convert.
Business mistakes to avoid
What are some mistakes that people should really try to avoid when starting a business?
The most common mistake I see (and am guilty of) is overestimating the business’s value. Not only does this create a distraction to the business at a time when focus is critical to success, but it makes bouncing back from a potential failure that much harder. Startups are hard. You have to stay nimble in order to survive, and the more you lean into the success of a company by committing time and money into things like tax havens, large asset purchases, and long term contracting agreements, the longer the recovery time will be between your next ventures.
Why do people do that? Do they just get ahead of themselves or overestimating the market for their product? How can they guard against it?
I honestly don’t know why entrepreneurs do this. It’s really just my personal observation, but I’d venture to say it’s a common behavioral/personality trait that entrepreneurial-minded individuals share. People’s greatest strengths can also be their greatest weaknesses. Entrepreneurs tend to be passionate, energetic, enthusiastic, and confident, and that type of personality is often coupled with big egos, exuberance, and overconfidence.
“Think Big” is a motto that resonates with many new entrepreneurs, and for good reason, particularly if you are creating something that’s never been done before and has a mass market opportunity, but it’s also important to be cognizant and realistic while you are building. I think how they do it—and in my opinion this is generally younger founders and/or brilliant scientific/engineering minded individuals—likely stems from a general lack of knowledge and/or experience in the fields of finance, accounting, financial markets, sales, or marketing.
The biggest takeaway
How did you know when to pull the trigger on a new business?
Early on, I learned it is best to try and fail quickly and often, so I would just work on any ideas that had a low cost/barrier to entry. Trust me when I say that the vast majority of my endeavors were failures, which is why staying resilient is critical to push through failure. The more you try, the more you learn which certainly increases your chances for success the next time around.
Many thanks to Bryan Gardner for granting this interview and sharing his insights.