Friends of Founders: Trust/Estate Planning and Founder Focus, with Michael Arlein
Michael Arlein is undoubtedly one of the most impactful attorneys in the startup ecosystem. Although he works with many founders based in New York, he connects with startups around the country whose founders can benefit from strategic trust and estate planning. His reach is broadest through Patterson Belknap’s Founder Focus Resource Center, where Michael is held out as the premier resource for Trust and Estate planning for business owners and startup founders. Founder Focus is an index of legal insight crafted for founders, entrepreneurs, and the professionals who advise them. The resource hub brings together clear, founder-oriented content on complex legal areas that founders grapple with as they build, grow, and eventually transition or sell companies. When it comes to considerations around QSBS, and strategic trust planning and stacking for QSBS expansion, Michael is the best there is.
“It is a privilege to be an adviser to some of the best and brightest leaders around, and it gives me great optimism for the future of our country and the world to observe their success.”
- Michael Arlein
Michael and the Patterson Belknap team are trusted partners for our clients, so we’re glad to profile him on this first “Friends of Founders” article:
QSBSrollover.com: “What makes the Founder Focus Resource Center unique?”
Michael: “Our Founder Focus Resource Center is a repository for content that we believe would be helpful to founders and their advisors. The idea for an article always comes from our real world experience advising founders. Some of the topics relate to tax planning, but many relate to other areas of focus like employment and philanthropy. Some of the most popular articles on those topic include “Five Situations When Founders Should Consider Engaging Their Own Legal Counsel,” “Key Employment Issues for Founders” and “Entrepreneurial Philanthropy.””
QSBSrollover.com: “Why might a founder seek trust/estate planning?”
Michael: “The most common impetus for a founder to pursue estate planning is to reduce taxes in connection with a liquidity event. More founders than ever are aware of the benefits of stacking strategies around Qualified Small Business Stock (QSBS). Given the volume of work we do with founders, we are uniquely positioned to be able to quickly diagnose and implement the most effective tax mitigation strategies. Those strategies often involve trusts but sometimes we determine that a non-trust approach would be optimal. As lawyers, we are ultimately selling advice, not products, and we have the wisdom gained from decades of experience and hundreds of founder client engagements.”
QSBSrollover.com: “What role do you play in helping founders maximize the impact of liquidity events?”
Michael: “Tax alpha is the extra return on investment that can be earned by actively employing tax efficient strategies. I think of tax alpha as my primary value-add for a founder facing a liquidity event. Founders are focused on running their businesses and it is not uncommon for me to be engaged at the eleventh hour prior to a liquidity event. We are able to move very quickly to implement planning, sometimes in a matter of days. We try to make the planning process as quick and painless as possible so the founder can get back to running his or her business.”
QSBSrollover.com: “If you had to branch out and start a company that wasn’t a law firm, what would you do?”
Michael: “I am not wired to start a company of my own and am very happy to have built my practice within a 110 year old law firm filled with colleagues who are much smarter than me. That being said, one day many years from now I would love to start a landscape design firm since gardening is my favorite (and only) hobby.”
QSBSrollover.com: “What word of advice or encouragement would you offer to founders still fighting to make their vision a reality?”
Michael: “I have spoken to thousands of founders over the years. It’s amazing how many times I speak to someone who is just starting out and then hear back from them many years later to discover that they have built a tremendous business. It is a privilege to be an adviser to some of the best and brightest leaders around, and it gives me great optimism for the future of our country and the world to observe their success.”
Click to learn more about the Founder Focus Resource Center and Michael Arlein. Also, check out our podcast episode with Michael on QSBS, Solved.
