How to Quit Your Day Job and Start a Cocktail Company
If you’ve ever dreamed of starting your own tech company, no doubt you’ve read about awesome women working in the tech industry who are fueling innovations in many different industries. But for a plucky upstart like yourself, matching your ambition to your dream project in tech can take a bit of figuring out. Perhaps you’ve had a brilliant idea like the COO of TaskRabbit, but weren’t sure how to transform your idea into reality. This week, in our How to Quit Your Day Job series, we chat with Lara Crystal and Lindsey Andrews, the co-founders of Minibar, about their at-home delivery service for wine, spirits and beer. Lara and Lindsey share advice for climbing the tech ladder.
Meet the Cocktail Pros: Lara Crystal and Lindsey Andrews
Lara Crystal and Lindsey Andrews first met while attending Wharton School of Business. The two friends went on to work for some amazing tech companies post graduation. Lara’s first gig was working at Rent the Runway and Lindsey learned the ropes at Fresh Direct. Building on their tech startup experience, the two spent time brainstorming ways to combine their skill sets. “Since I had always been at luxury companies and Lindsey had always worked in consumer products, alcohol was the perfect combo of our skill set — it’s the luxury consumable!” says Lara. Thus, Minibar was born.
1. Set time aside to discuss business ideas. If you and a friend want to launch your own company, make sure to schedule time together to brainstorm and discuss. Lara and Lindsey met once a week on Tuesdays that they designated as “Takeout Tuesdays.” Over a Seamless delivery, they chatted about a friend’s suggestion that they think about the alcohol industry. “It all just clicked,” says Lara.
2. Learn from industry pros. Take the time to talk and network with professionals who specialize in your chosen industry. Lara and Lindsey took as many meetings as possible with people in the liquor industry and leaders who started their own businesses “to learn and absorb knowledge from others. We met with everyone we could that knew everything we didn’t.” says Lara.
3. Rely on your trusted friends and family as your beta testers. While Lara admits that it was pretty easy for her and Lindsey to convince their friends and family to order “a great bottle of wine and give us their feedback on the service,” the pair also relies heavily on their support system as advisors, investors and testers.
4. Find a partner. If going it alone as an entrepreneur is too intimidating, consider enlisting a trusted friend or co-worker who you work well with and wouldn’t mind spending long hours hustling and learning with as a team. “If you’re scared to take the leap alone, find a great partner that can push you to take it,” says Lara.
5. Hire the right team. Lara and Lindsey credit their success to recruiting the ideal employees for their company. The duo took the time to find the candidates best suited for their brand, and that has made a huge difference in work satisfaction. “We’re happy that everyone we first hired is still part of our Minibar family,” says Lara.
6. Stick with your vision. When you’re launching your dream biz, it’s easy to compare yourself to every other similar company out there and get stuck on what they are doing. Instead of doubting your vision, Lara recommends, “Be laser focused and stick with your vision.”
Perfect Your Skills
1. Beer Brewing Online Class ($19): This one-hour class will teach you the basics of brewing your own beer from supplies to fermentation to the final sip. Snag the Grapefruit Honey Ale Beer Kit that goes with the class as your first brew.
2. Meet Up With Women Entrepreneurs (Free): Meeting like-minded women leaders is one way to network and learn from hustlers who have been there and done that. With MeetUps all across the world — from Singapore to New York City — you’re bound to find the group that’s right for you.
3. Become a Great Wine Taster ($69): Master Sommelier Richard Betts teaches you how to buy, taste and enjoy wines. Learn about the trends and many wine varietals out there and understand what’s in your wine glass.
Are you a cocktail maker maven?Show us your latest concoctions by tagging us on Instagram + using hashtag #iamcreative!
(Photos via Minibar)
Welcome to Selfmade Finance School, our new money series with Block Advisors to help small business owners with their tax, bookkeeping, and payroll needs year-round. This week, we explore the tax implications of bringing family members into your business.
The question for today is this: Does hiring your family members make sense for your business? Let me be clear. This is not a piece about whether hiring your family members makes sense for your relationships with those family members. As someone who is part of a family business, I could fill up a lot more than 600 words on my opinions about that. For today's purposes, we focus on whether it makes sense from an overall "good business and tax implication" perspective. As it turns out, there is a decent amount of tax nuance when it comes to employing your family. Let's break it down based on relationship to the employee:
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Spouses Who Are In Business Together
Personally, if I had to be in business with my husband, it would not go well. However, many couples build viable, strong businesses together and I say, good for them! Depending on how you have your business entity structured, it will make a big difference on the tax treatment of you and your spouse working as partners. Because a business jointly owned and operated by a married couple is generally treated as a partnership for Federal tax purposes, the spouses must comply with filing and record keeping requirements imposed on partnerships and their partners. The election to file two Schedule C (Form 1040) forms, (one for each spouse) permits certain married co-owners to avoid filing partnership returns, provided that each spouse separately reports a share of all the businesses' items of income, gain, loss, deduction, and credit. Under the election, both spouses will be subject to self-employment tax and on net earnings from self-employment and receive credit for Social Security earnings.
One Spouse Employs Another
If you have a dynamic where your spouse is an employee of your business, then your spouse's wages are subject to income tax withholding, Social Security and Medicare taxes. If you are self-employed (not a corporation or a partnership), your spouse's pay does not have to be included in your federal unemployment tax account (FUTA) contributions and payments. However, if your business is a corporation or a partnership you must include that spouse's pay in your unemployment tax contribution calculation.
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You Employ Your Child
First, let's be clear. I work in my family business, but I am an adult, so I am treated just like a normal employee. However, if you, for example, run a family restaurant and want to hire your children under 18 to work for you, there are some tax benefits. But first, you should check with your state for rules on how many hours minors can work (in non-agricultural jobs) and reference the Fair Labor Standards Act for information on limitations on the kinds of work children can perform.
"This is an often overlooked or under-utilized strategy. Paying your children for true services they provide in your business can be a powerful tax-saving tool," says Cathi Reed, Block Advisors Regional Director. "If you are a sole-proprietorship or single member LLC, and the child is less than 18 years of age, the business is not required to withhold FICA or payroll taxes. The child can use his or her standard deduction against income you pay."
You Hire Your Parent
Oh dear. If you are brave enough to do this, know that you will need to pay Social Security and Medicare taxes on your parent's wages and make the appropriate withholdings, but you don't have to pay unemployment taxes. Now all you have to do is convince your parent that you are the boss. Have fun with that!
Is Hiring Family Members Worth It For The Tax Benefits?
"There are some positive tax advantages to hiring family members. It's important to treat a family member like any other employee. Hiring your children can result in substantial savings for businesses. Make sure your child has real, age-appropriate work to do and a reasonable pay rate, comparable to other employees. Consult with a Block Advisors small business certified tax pro to ensure that you are complying with all requirements," advises Reed. "Block Advisors, a team within H&R Block, is dedicated to meeting the tax, bookkeeping and payroll needs of small business owners year-round. To start working with the tax experts at Block Advisors, visit blockadvisors.com."
In my opinion, you should not hire a family member solely because of the tax benefits. You should always hire based on whether that person is right for the job and keep in mind how this hire could materially impact your relationship with that person and others in your family. Finally, as I mentioned, make sure you have a tax professional on your team when making these determinations. As you can see, things can get a little tricky!
*All details were sourced from IRS.gov and blockadvisors.com