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Tag: Matt Barbieri

The Investor’s Perspective: How Pitch Decks Often Miss the Point

Over the years, we’ve seen thousands of pitch decks and had countless conversations with both investors and early-stage startup founders about investment opportunities.  As a result, we’ve gained a comprehensive understanding of both the solicitor and the solicitee’s perspective. Generally speaking, pitch decks tend to be too long and not comprehensive enough in addressing the financials; but this article focuses on one particular slide: the use-of-funds slide.  We explain the purpose...

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Series A vs. Series B: Upping the Ante With Preferred Stock

You crafted a clear and thoughtful pitch deck, and investors are ready to climb aboard. But even when a venture capital (VC) firm or angel investor believes in your vision, they’re still taking a significant risk with their cash.  They’re going to want some special treatment and protections for bankrolling your C corporation at such a pivotal point in your journey. They’ll ask for (or you’ll offer) preferences.  Commonly, investor preferences come in the form of preferred stock,...

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The Frustrating (but Ethical) Truth: You Can’t Invest Your Investment

It’s a definite high point for any early-stage startup founder: You’ve successfully wrapped up your initial round of fundraising and are sitting on a stack of cash. Investors believe in you and your product. You feel on top of the world. If you’re like many of the business owners we support, you’re probably wondering what you should do with the freshly raised capital. Certainly, if you were to come into money in your personal life, the wise thing would be to invest the money so that...

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How and how often should I communicate with my investors?

You’ve honed your business plan, you’ve implemented systems and processes, you’ve pitched (and pitched, and pitched again) to prospective financial partners. You’re finally fully funded, but now you face a new problem: Your investors need to stay briefed on the business.  What’s the best way to communicate with your supporters, and how frequently should they receive updates?  This question has come up countless times with our clients over the years, and we’ve learned a thing or two...

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What is the Angel Investor Credit Program?

What if there was a way to guarantee a return on an investment? If your business operates in one of the 29 states currently offering Angel Investor Tax Credit Programs, it may be possible.  These programs are popular avenues by which states incentivize innovation, job creation, and economic growth in their region and, in some instances, encourage the development of growing neighborhoods and minority-owned businesses. Parameters of angel investor credit programs vary drastically from...

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Can I Raise Cash Flow for My Small Business With Government Money?

There’s nothing worse than finding out you could’ve qualified for government funding after it’s too late, especially when your business is in its infancy and you could use all the cash you can get your hands on. Most of the founders we advise aren’t aware of the financial help that’s out there, or which programs are available for their business.  We introduce two specific opportunities for government funding that are important for startups to know about: national tax credits and...

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What did I do wrong? (Common traps small business owners can avoid)

If you’re like most founders, when you first begin the process of starting a company, you’re focused on being compliant in every way. You aim to build a business people want to invest in. But even with the best of intentions, you could overlook some rules that have big implications. Taxes are an area in which new small business owners make frequent mistakes. It’s not intentional, they’re usually just unaware.  Let’s talk about two specific tax-related errors many of our clients make...

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How can I take advantage of Qualified Small Business Stock?

In the early days of startup formation, it’s helpful to think years into the future — more than five years, to be exact. That’s the minimum term to which the Qualified Small Business Stock (QSBS) tax exemption applies. QSBS is a big incentive for structuring your U.S.-based business as a C corporation (or converting from an LLC) because it’s reasonable to assume your investors will someday want to exit. When they do, they could be looking to qualify for this huge tax break. What...

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How Do I Exercise the Stock Options I Was Granted?

If you’ve been offered stock options as part of a compensation package at a startup, it may seem like a no-brainer to accept. And that’s usually true — as long as you clearly understand how to turn the initial piece of paper that grants you those options into a tangible investment on which you don’t have to pay income tax rates.  It’s common to assume you should hang onto that paper and let it grow for as long as possible. But if you do, you could be in for a rude awakening when...

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The Truth About Stock Options: What You and Your Employees Should Know

By Matthew Barbieri, Partner It’s becoming more popular to offer stock options to new hires as an incentive, especially if you’re on a limited startup budget. While you may not be able to offer new hires a world-class salary just yet, you can throw stock options into a compensation package to sweeten the deal. However, it’s easy for both you and your employees to be blissfully unaware of some key details about holding and converting stock options. To avoid confusion down...

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How To Distribute Authorized Stock to Startup Stakeholders

It’s not often that you hear entrepreneurs tell the truth about what it takes to get a startup rolling, especially about the nitty-gritty details of how to authorize shares of stock. In this article, we’re taking away the mystery of share distribution. If you’ve already decided to set up a C corporation and learned about initial valuation, the next step is to figure out how to split shares of the company fairly amongst stakeholders — and wrestle with the math behind those decisions. Determining...

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How To Raise Capital Without a Startup Valuation

An exciting part of early-stage startup ownership is bringing on investors who believe in your mission. But before you offer them equity in your business, you have to figure out how much it’s worth.  Every startup is unique and, as with many other factors of entrepreneurial life, there’s no one-size-fits-all way to complete a valuation. However, there are some best practices you should follow when assigning a reasonable value to your company and appealing to investors with convertible...

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What type of entity should my startup be (a C-Corp or LLC)?

CPA and Partner at WISS & Co., Matt Barbieri discusses the reason he’s doing this podcast (basically to answer all those questions he gets over-and-over) and then answers a question he gets ALL THE TIME from startup founders, which is, What type of entity should our company be? Listen to the episode here… Still need more guidance? No problem! Reach out to a Wiss expert for answers. Contact Us

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