The Founder's Guide to Building Wealth While You Build Your Business
- Brendan Fraleigh
- 2 days ago
- 8 min read
Most founders we work with are really good at building.
They know how to grow revenue. They know when to reinvest. They know how to push through the hard stretches that come with building something from scratch.
What we find ourselves talking about constantly is whether the personal financial side of their life is growing with the same intention.
Because here is what we see happen.
A founder builds something impressive. The business is growing.
And then they get close to the exit and realize the personal side of their financial picture never kept pace with what they built professionally.
There is a gap between the business and personal side. And the two aren't running together.
In this blog I am going to break down the three stages of building a business and what you should be executing while you are living it.
Here's The Founder's Guide to Building Wealth While You Build Your Business.
Stage One: Growing the Business
The Cost of Betting Everything on the Business
Most wealth advisors will tell you, you need to be investing in the market.
And while they aren't wrong, they negate to inform you…
Your business is your most important investment.
You should be reinvesting into your business during the growth stage. It is how you get to the exit you are building toward.
But here is what we see happen when reinvesting becomes the only move.
A founder puts everything back into the business for years.
By the time they get close to an exit, the business is worth something real, but the personal side of the picture tells a very different story.
Everything you own is tied up in the business itself.
When that is the picture, everything is riding on one transaction.
That is a significant amount of pressure to put on a single event.
And it is completely avoidable if the personal plan is running alongside the business plan from the beginning.
Start with Your Personal Retirement Account
One of the most underutilized tools we see in this stage is the retirement account.
Solo 401(k)s
SEP IRAs
Defined Benefit plans
All of these retirement accounts exist specifically for business owners and can move serious money into a protected, tax-advantaged environment every single year while you are still building.
Not only does this grow your personal balance sheet, it reduces your tax bill in the process.
The founders who feel the most secure at exit are the ones who were quietly building something real on the personal side the entire time.
And no better place to start than putting money away for retirement. If you want to dive deeper, we have a simple guide to retirement planning for business owners.
Next up: The Distributions Question
The Distributions Question
How much are you taking out of the business, and how much are you keeping in?
For most founders, the honest answer is whatever the business allows or whatever they need at the time.
That is understandable. But it is not a strategy.
Think about your business finances in three buckets.
Your fixed cost, the non-negotiables that do not change month to month.
Your variable costs, the expenses that fluctuate and can be managed.
And your profit and distributions, what is left and what flows to you personally.
The mistake we see constantly is founders treating that third bucket as an afterthought.
Whatever is left over at the end of the month becomes the distribution.
But when you build the distribution into the plan from the start, everything changes.
What you take out builds your personal financial life.
What you keep in fuels the growth of the company.
Both matter.
And the right balance looks different at every stage.
Founders who are deliberate about this, who actually decide how much flows to the personal side and how much stays in the business, are in a fundamentally stronger position by the time the exit comes.
They have been building something on the personal side the entire time.
They have not been living off of whatever was left over.
But the distribution strategy and budgeting strategy need to coincide with your personal life.
Stage Two: Preparing for the Exit
Do You Know What Your Number Actually Needs to Be?
Most founders have a number in mind.
Sometimes that is a figure they are building toward. Or even an exit value that feels good to take the next step personally.
But very few have ever worked backward from that number to understand what it actually means for their personal life.
Because after taxes, after the structure of the deal, the number that actually hits your account is not the number on the term sheet.
Whether that real number funds the life you want on the other side of the exit is a question worth answering long before you are sitting across from a buyer.
We help founders like you work through this math and have a plan before the sale.
Finding Your North Star
The framework to exiting your business takes a strategy. More importantly, you need to be able to answer three fundamental questions:
What does it cost to live the way you want to live?
What do you want to give?
What do you want to leave behind?
Add it up, subtract projected taxes, and what you get is a north star.
A real number that tells you what the outcome actually needs to be.
That clarity changes everything.
It changes how you evaluate offers.
It changes your timeline.
It changes how much pressure you feel when a deal is moving.
And it gives you the confidence to walk away from something that does not actually get you where you need to go.
How to Make the Most of your Taxes
We all don't like paying them. But with any successful business, the government wants theirs.
This one needs to be said plainly.
The tax implications of how you sell your business are significant.
And the strategies that can meaningfully change what you keep require decisions made well in advance of the transaction.
Retirement account contributions made consistently throughout the growth stage reduce your tax burden today and build your personal balance sheet at the same time.
Business structure decisions made early have direct implications for how the sale is taxed.
And certain planning strategies, the ones that actually move the needle, require decisions long before you look to exit.
By the time a deal is on the table and moving, most of those doors are already closed.
What could have been planned around becomes something that has to be absorbed.
If you are building toward an exit, this conversation needs to start now. So much so, that we have a blog post on tax strategies for business owners.
Stage Three: Life After the Exit
Have You Thought About What Comes Next?
This is the part of the conversation most founders are not having and oftentimes gets overlooked.
But honestly, it is arguably the most important.
Here is what we have seen play out. You sell your business and the money hits your account. You are "financially free," but deep down, something is missing.
The thing that drove you, the building, the problem solving, the chase of growing something from nothing, is no longer there.
And for a lot of our founders, that is harder to navigate than anything that happened during the business itself.
Your identity was tied to your business and now that it's no longer there,. You feel lost.
What we have seen is that the founders who navigate this well are the ones who had a financial plan running alongside the business the entire time.
So that when the exit came, they were not scrambling on the money side while also trying to figure out who they are next.
It means you can take real time before making any major decisions.
You do not have to rush into the next thing because the pressure of the money demands it.
You can be thoughtful about what the next chapter actually looks like, whether that is starting something new, investing in others who are building, giving back, or simply living the life the business was always supposed to fund.
That is what the personal plan, the one that ran alongside the business the entire time, actually makes possible.
Not just a better outcome at the table.
The freedom to figure out what comes next on your own terms.
Final Thought
If you are in the growth stage, building something real and thinking about where it eventually goes, here is what we would ask you.
What does your personal financial picture look like, independent of what this business is worth?
If that question creates any uncertainty, it is worth a conversation with a wealth advisor specializing in helping entrepreneurs.
The earlier it happens, the more options you have.
That is exactly the work we do with founders at Moment Private Wealth.
We build the personal plan alongside the business so that when the exit comes, and when life after begins, you are ready for both.
Get in Touch With An Advisor
Frequently Asked Questions
Here are some answers to questions I receive frequently from entrepreneurs.
When should I start building my personal financial plan as a founder?
The earlier the better. The founders who feel most secure at exit are the ones who were quietly building something on the personal side the entire time, not scrambling to catch up when a deal is on the table. Our role at Moment Private Wealth is to help you build that structure.
How does Moment Private Wealth help business owners with taxes?
Moment Private Wealth serves clients by running quarterly tax projections. Additionally, the firm works directly with your CPA to ensure all parties are on the same page, estimates are known and communicated to be paid in advance of deadlines.
Can Moment Private Wealth help business owners with succession planning?
Yes, this is part of creating a roadmap for your goals. Having first-hand knowledge of selling a business will allow you confidence throughout the process. Many business owners get one chance to sell a business. Having a firm that can help is key.
What does your average client look like?
Our clients are nearly all athletes and business owners. Our average client has a net worth greater than $5M. The strategies, solutions, and planning that we implement have a high-net-worth and ultra-high-net-worth client in mind.
Can Moment Private Wealth help set up retirement accounts for me as a business owner?
Moment Private Wealth uses Fidelity Investments as a third-party custodian for our client investment accounts. As a result, Moment is able to open IRAs, Solo 401(k)s and Defined Benefit plans and help manage those investments on your behalf.
Why should I consider hiring Moment Private Wealth?
Great question! But first, let us explain why you shouldn’t hire us. If you’re looking for an advisor who will pitch shiny object investments or be a “yes man” you are in the wrong place. Why? Because we believe in being truth tellers and only giving advice that we take ourselves. The investments, strategies, and planning we do are all things our advisors do with their own money. If you are an athlete or business owner interested in things like lowering your tax bill, investing smarter, and finding a trusted partner we might be a good fit.
*Moment Private Wealth offers information on tax and estate planning that is general in nature. Tax and Legal advice are not provided by Moment Private Wealth. Consult an attorney or tax professional regarding your specific legal or tax situation.
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