Innovation Banking: 

Personal Wealth Strategies 

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Hi, I'm Paul McKinley, Co-Head of CIBC Innovation Banking. My colleagues and I work with high-growth technology and health care companies, and have been doing so for the better part of 20 years. Today, I'm joined by my colleagues at CIBC Private Wealth US.  

 

This is a wealth management firm, award winning, that has a deep history of working with company executives and entrepreneurs on optimizing their personal financial situations, which is unique in many cases to most clientele. We're proud to be a part of CIBC, one of North America's largest financial institutions, with a 150-year plus history. Welcome to our fireside chat. Thank you for joining us as we explore how company executives and founders can optimize their pre and post liquidity, financial situation.  

 

CIBC Innovation Banking 

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Thank you Theresa and Kenny for being here. We're going to talk a little bit about private wealth personal financial situation for founders and executives. I started my career in the wealth management industry. I've been doing what I do for a long time. So, this is a topic that's near and dear to my heart. And I know, for both of you as well. Maybe you just start off, let's talk about kind of the importance of planning early. Oftentimes we hear from founders and executives that, you know, either it's too early in their business for them to start thinking about it, or they just kind of neglect to think that it's the right time, but that often becomes, too late very quickly. So maybe let's touch on some of the things that founders and executives should be thinking about very early, to get themselves organized and prepared personally. Ken you want to..?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Yeah, absolutely. Thank you. So, founders and executives of tech companies have very complex situations. They have complex cash flow and liquidity and it really pays to have, financial advisors that both know their business as well as their personal situation. So, if you could find an institution that has both of those really under their belt, it's really good to go deep with them.  

 

The more they know about your business, the ups and downs of it, as well as the cash flow that you have, the better they can help and advise you, really have a strong, profile to meet what you need.  

 

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

And Theresa, maybe talk about some of the, you know, you were a practicing estate attorney. There's a lot of things that we've seen founders again, neglect specifically around estate and taxes, and those sorts of things, and suddenly they have an exit on their hands and it's not too late, but they're scrambling trying to sort that. So, what are some of the things that you'd recommend for folks like that?  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

Don't wait till the last minute. That's my first recommendation. But you're absolutely right. You know, I think a lot of times, especially early on in a business, especially somebody who's maybe younger, like, I don't need to do estate planning, right? It's like, you know, I'm invincible. I don't have my wealth yet. I want to wait. The earlier you can plan, the better, because we can get certain structures in place. Even just the basic estate plan.  

 

When you think about a will, a trust, powers of attorney really kind of that those what if documents, those documents of what if something were to happen to you unexpectedly. Who's going to step into your shoes, your financial life or your business life? How does that work and how does that look? And, you know, you might be young and not ready to make some of those decisions, but you kind of have to make those decisions. And so really kind of thinking about the decisions and then revisiting over time, I often say to clients, plan early and plan often because we kind of always need to take a look at how is my family change, how is my business change, and make sure that the documents correspond to that. 

 

I think same is true with the business documents. When, you know, maybe you just kind of put your limited liability company together and you kind of start going off. But then as the business grows, it becomes more complex. So making sure maybe you have things like a shareholders agreement or an operating agreement that addresses transfers and interests, who has the voting control? Do you have those things separate? And voting and non voting. So really kind of start making sure that the business documentation, that legal side of things is growing as your business grows.  

 

So as to your point, you know, all of a sudden you've got a liquidity event on the horizon and now we're in fixing mode, as opposed to just letting the documents, letting the business grow together. I think that can be really helpful. And, you know, a lot of times for clients who think they might ultimately be in an estate tax situation, you know, to the extent people can transfer interest to maybe a trust for the benefit of their children or their spouse and children, well, we can transfer value early before the business grows. We have a lot of estate planning that we can do with that type of early planning.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

 

Oftentimes, the venture ecosystem, if you've raised venture capital you’ve raised growth equity, you've signed up for a liquidity event at some point in the future. So there's kind of two phases to that journey for the business, which is sort of building in pre liquidity. And then there's, you know, some sort of strategic exit or recapitalization. Those also mapped to a personal situation and how that could be different. And I think the pre liquidity piece is probably where most people struggle to get the advice. They think it's too early or what have you. What are some of the things maybe to double click on the pre liquidity piece. And also why they should start to get to know an advisor now versus at that time.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

So, I think on the pre liquidity, kind of again, the idea of this idea of can you transfer some of those interests out. Can we start really thinking about how do we get the economics to benefit the family in a certain way. And again when values low that's helpful. But on the planning side, thinking through that what if situation, right? So your pre liquidity you're building this business. Who are the advisors you have around you. You know both in the business and outside of the business. Working with an estate planning attorney, an accountant, a banker, an investment banker. Really thinking about, you know, how do we grow this business, what's making the most sense, both on the business side and the family side? And the more they get to know you and your family and your goals, the better set up you will be when that liquidity event happens. Or, you know, maybe you're kind of rolling it into your next business. You know, it's really having those advisors in that pre liquidity situation help you grow and help you plan in a way that I think you just will reap the rewards.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Oftentimes some of the bigger firms can be intimidating for founders and earlier stage companies. If they don't have $10 million of wealth sitting around yet, there's these, you know, quote unquote, minimums that that firms have. How would you suggest founders and next get to know advisors that, you know, maybe on the surface don't necessarily meet the criteria that that firm advertises, like, what are some of the truths and myths about that?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

From a banking standpoint, we focus on relationships. So, when we, help clients and prospects, we look at the full breadth of what the relationship has with the institution, and we try to help people regardless of the size. We know this is a long process, and the wealth creation cycle takes quite a bit of time, and we're willing to really roll up our sleeves early to understand helping you through the situation. Because if you start this early enough, you will have the time when a liquidity event happens. It's supposed to be a very happy, cheerful thing, and having people in there from the start really helps you drive that forward.  

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

So said another way, sometimes the separation of personal and business can be detrimental to some extent because you want an institution, whether it's CIBC or others, to kind of understand both sides of your situation because they are so interlinked.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Absolutely. Especially in this business, it's it's such, a unique situation in the general population. People have recurring cash flow streams here in this you're driving value and that takes time. And there's unforeseen things that happen that can be very positive or very negative. Having your advisor team early helps you with, they know some of the unseen things that could happen. It really helps you through when times are tough and when they get better. Everybody wants to be a part of it, but if you have a team that goes to you, the ups and downs, the client matters there.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

And I think kind of in working with the team that has resources like mine, like as a wealth strategist, but also kind of has the connections in your community to say, I want you to meet this business lawyer or this estate planning lawyer helping to really kind of corral all of those. It doesn't matter if you necessarily meet the $10 million minimum. We know who in the in the community works with those types of families and business owners. So I think that that that can bring a lot of help to the table, regardless of your at a quote unquote minimum.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

It's a quarterback of multiple resources from multiple...  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

- Exactly. Yeah.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Different solutions or problem sets that you need to solve for a founder and executive. That makes sense. Maybe let's talk a little bit about post liquidity. Then and again, this can be a topic that a lot of founders or executives neglect to think about until it's too late or it's there. But there's probably a lot to learn from thinking about that stuff early on the off chance that you have this great exit, what are some of the things that pop up for founders and executives post liquidity? You've got this wealth that you've built and now you've got a new set of problems.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

So I think, you know, from kind of my perspective, kind of on the estate planning side, you know, one of the biggest concerns for people is, oh my gosh, now I've got all of this money. One, how do I prepare my kids for it? And what do I want to do with it. And so we talk to a lot of our clients about, okay, how do we educate that next generation, right? I mean, kids know more than we I think sometimes we think they know when depending on what age that next generation is. You know what? What's the right level of engagement? What do they need to know? How do we make sure that when that wealth does transfer to them, they're ready for it, that they don't just go spend it? How do we plan around it with things like trusts and just education of that next generation? I think that's a big hurdle for a lot of the business owners we work with. It's kind of, now what? Right? And you've spent so much of your life really focused on that business, and now all of a sudden you've gotten that benefit from it. But now what do I do with my time and with all of those assets? And I think from an investment perspective, what a lot of our clients all of a sudden see is all of their risk has been in this business and they might have been investing maybe in more safer investments. Well, now when there's a bigger pool of money, we're looking okay. How do we diversify those assets. You know, you've stepped away from the risky business. And then how are we changing your investment model, maybe your asset allocation to make sure that it again, addresses you know, your risk tolerance, but also kind of recognizes you've got this new wealth, this new liquidity?  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Yeah. So one topic on that in the venture in the growth equity ecosystem, naturally, a lot of founders and executives lean towards what they know, which in investing is usually a good thing. But in this case, you've got a number of folks who will end up gravitating towards angel investing, as well as to the venture funds and growth equity funds that they have worked with and have access to as a result. But your goal post liquidity probably changes from like grow the wealth, to there's some element of reserve and a new set of investments to learn about. How do you advise clients to start to think about that and get to get comfortable with spreading across different asset classes and, you know, not necessarily just leaning towards what you know, because what they know is, is a concentrated, risky situation which paid off for them. But and because of changed.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Yeah, I'd say it's two things. It's understanding what your objective is, developing a plan around that and then being disciplined. It's about understanding. Like you said, there's preservation now. It's okay. There's a lot of things a lot of positives here. And there will be many good deals as you see, that come down the pipe. But there are ways where you can manage having a very diversified portfolio and still having the ability to invest where you need, as long as you stay disciplined to your plan.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

Well, I think to your point earlier to Kenny, you know, this idea of getting to know your advisors early and kind of working through the pre liquidity, post liquidity. So, you've been having conversations about “Okay, what does post liquidity look like?”, way before you're actually in that situation. So, you've learned about what are the different asset classes and what are different structures we can set up. Maybe you set up a family LLC that's focused on investing in some of that angel investing. And then but this part over here, we're going to do the more traditional investing. So I think kind of having those conversations with your advisors early sets you up for success. Once you're post liquidity and can kind of look at what are our buckets, right. What are we doing with the different the different assets and the different asset classes.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

And there's certainly services and products that, financial institutions offer that can help you with that. You could have your diversified portfolio of equities, but you could also use leverage where appropriate to help you invest in these in these opportunities, while still maintaining a diversified set of investments separately.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Maybe taking this conversation, but the pre exit and pre liquidity, is there ways that founders and startup executives can start to diversify their wealth or soon to be wealth. In advance of that big liquidity situation. Obviously it's got $10 million or $100 million or whatever the number is sitting around. It's still a, you know, problems to be solved, but it's a nicer problem to solve. - It’s easier. What about before the exit comes around where there's, you know, they might have a decent amount of wealth on paper in the business, but is there ways to kind of diversify their risk and, you know, hedge a little bit there?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Yeah, I'd say as a banker here, we always worry about the downside. So establishing a reserve, a rainy day fund that's separate and distinct from your business and day to day lives is very important for us as we look to qualify people for mortgages for other types of credit instruments. Liquidity is important. Banks care about liquidity, cash flow. As the founders are growing the value in the company, it's important to have people that can advise and those two things liquidity and cash flow. And do you have enough in a rainy day fund that you can use to weather the storm? Because there are times where things are great and there are times when things aren't. Your banker should be focused on helping you reduce the downside risk that you have.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

We like to think that all the businesses we work with are going to be massive exits. But the truth is, venture and growth is a power law business, and there's lots of situations that don't work out according to plan. And so getting ready for that is, I think, what you're keen in on there.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

And as you evaluate larger credit facilities and as you grow it and your family needs, those reserve accounts matter. And just to know there's you should be growing those as your, family life and your needs grow. It's important to have, those funds set aside in uncorrelated assets separate from the business. We wouldn't look for, somebody to be investing in the tech sector if they work in the tech sector every day. Separate, uncorrelated risk is important.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Maybe one topic that I've, I've always, wrestled with my own parents and tell them about is really like, how do you choose an advisor? And of course, you know, we like to say CIBCs is a great place to come and get that advice, but what are the questions that people should be asking whether it's pre liquidity, post liquidity to advisors both on the on the banking and the investment side to get to know whether it's the right fit for them, whether they've got the right skill set? Do you ask for a resume? Like, if you were on the other side of the table picking advisor, what do you ask about?  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

I mean, for me, it a big part of it is a personality fit, right? Especially on the estate planning side. I always tell clients, meet the person and make sure you like them. You are talking to them about very personal, hard decisions and so make sure there's a personality fit right. So I think first and foremost kind of across advisors, it's is it somebody that you can call up and be like, okay, I've got this concern how can you help me? Somebody you feel comfortable having those types of conversations with. From a resume, I don't think you necessarily need to ask that, but understanding how long have you been in the business? How long have you been at your current firm? You know, what do you specialize in? How do you help clients try to understand what their methodology is? Is it I put everybody in this strategy and then I walk away, or is it we meet quarterly and we talk about what your needs are. Is there a wedding coming up? Is there tuition you have to think about is, you know, a big trip? Like, how kind of deep do they dive into your personal life to then bring their expertise to bear, whether on the banking side, the investment side or the estate planning side? I think it's really important to have that connection and understand how they work. But obviously, you know, in my mind, you know, fees are obviously a part of that conversation, but shouldn't be the driver. You know, sometimes you get what you pay for when it comes to, you know, attorneys and whatnot. So you want to make sure you have the person with the right sophistication. So for somebody that's, you know, a founder, you know, making sure you're talking to a lawyer that maybe is an estate planning attorney, but also has a partner or an associate that works on the business transition side, really making sure that they can bring all of those expertise to bear. I said earlier, you know, this idea of how do they know in the community? How can they help you quarterback? Examples of when they've quarterbacked a situation, right? I am a big example. Like, tell me about a time when you helped a family with this situation to kind of understand their expertise. We can all put our credentials on a piece of paper, but I think hearing somebody talk about client situations, I think, goes a lot further when really helping somebody understand how an advisor approaches something.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

And Kenny, can I just pick on you on this one, like you private banking now, but previously had a business credit and a commercial lending background. Kind of gives a lens to both sides of a, a founders balance sheet. Really, how important is it to kind of have, you know, on one hand, you're asking for advice on topics that the founder maybe isn't an expert in. On the other hand, you need an advisor who kind of understands the situation they've been in as well. So how do how do you guys think about that?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Yeah, I'm a big fan of specialized knowledge, where your business drives the majority of your financial life. Having somebody that understands that business is critical, or the sector or the industry in which you participate in, it's really important because not only they can apply their trade to your specific set of facts in your situation. They know what it's like. They know what it's been through. They can understand, the value creation you're trying to achieve, leverage metrics, different types of lingo that are in there, and they could speak to you and help you understand how this will affect your personal side. So, it's key. It's critical. As business owners that are out there, you have unique needs finding somebody that understands that specifically as well as the industry in which your you practice is, is very important.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

So Theresa, you mentioned fees and there's a trend, I think, in the wealth industry of do it yourself and robo advisory. When I think about a founder or a startup executive situation that is complex, and I think you get what you pay for, particularly with lawyers and all sorts of professional services. How do you think about that from a fee perspective? Like, obviously the advice is not free, but there's value to it, right? And I do think, you know, it can be very difficult, especially, you know, if you're tight with cash flow because you're putting it all into the business. It can be like, how, how do I now spend this money on a lawyer or an investment advisor or anything?  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

And I do think at the end of the day, you get what you pay for. I mean, I've been with enough clients who I see where they went to an online provider and they think their documents say what they want and they don't. They're, you know, internally inconsistent. You know, there are just some problems with if you don't have somebody that has the sophistication that you need as a founder, again, that can kind of grow with your business. I think you could regret it, right? I mean, I think there's something to be said, for sometimes you outgrow your advisors. I've seen it where somebody outgrows their estate planning attorney or their business attorney. But then can we can shift. But having that good advice throughout, it's worth paying those fees. You think about what a mistake could cost you down the road when it's actual liquidity event, or in taxes. If you think about what you could save, not just what you're spending currently.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Yeah, I think same goes on the business side. If you have a document on a purchase and sale agreement not drafted properly or whatever, that might be like, that could end up being kind of detrimental. And it's probably a risk you want to avoid in your personal situation as well.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

Exactly, and if you don't have somebody that sophisticated enough that has seen a lot of different versions of that business document or how a trust works, you don't know what you don't know. And so I think that sophistication, something that can be brought to the table, is really important.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

- Got it.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

And if you're spending 100% of your time focused on your business, having an advisor there that can help while you're focused on that point in time will pay dividends as well.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

One thing that a lot of founders and executives certainly post liquidity, but even before that, they have causes that they talk about that they like to support. Post liquidity, you might have a little extra time and money to help do that in a more meaningful way. What are some of the things to think about from a philanthropy perspective, whether that's the most efficient way to give, making sure it has the most impact? How do you all advise people on that? 

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

So a lot of times when clients are interested in philanthropy, especially business owners, they might not have the cash flow right to make the large gift, to make the, you know, kind of annual gift. So they often will look towards that exit. And how can we get both you know, support for causes as well as maybe some income tax benefit. So a lot of times you'll see owners transferring interest in their business before liquidity event. Maybe it's to a private foundation or a donor advise fund so that when the business is sold that, that income tax event happens in the charitable organization, so we can save some income taxes that way. There are, of course, some rules and to follow in terms of making sure you do that correctly. But that's one way I see a lot of people. They get the income tax benefit plus that when that liquidity comes in. Now that charitable organization has the funds to continue and support the cause. The other time I see it as kind of post liquidity is when they're kind of going to our example earlier, like now we've got all this money, what do we do with it? And so we kind of sit down and say, okay, how much do you want for the family for your own needs? And then, you know, where does philanthropy fit in? And kind of what's the scope of what you want to do? Some people really want to put a lot of money towards a private foundation where they are. They have a specific cause they actually want to get in, and they kind of want to kind of do the work. So we might do one type of organization, or they want to just make grants to different organizations over the years. So we might consider a private foundation or a donor advised fund. So it's really kind of looking at the big picture. But I think that that's kind of the second time is when, when all of a sudden we have the liquidity, how can we put those dollars to work in the community?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

For me, it's having the plan, understanding the plan, understanding how it affects your personal cash flow and liquidity and then working the plan.  

 

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

- Executing on it.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Plain and simple... Plain and simple.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

- Same as they would in their business.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

That's right.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Maybe to kind of summarize the conversation a little bit like we talked about sort of pre and post liquidity, the value of getting that advice early I would say like you, the age old advice in the venture ecosystem is don't raise money from people that you met three weeks ago as part of a process. Get to know the equity folks early. And I think that obviously has a lot of merit on the personal side as well. But if you had to sum up kind of the perfect building blocks for like a well-planned personal situation for a founder or startup exec or investor from start to finish, how would you summarize our conversation and advice for people that are looking at this saying, what should I do now? And how do I get ready?  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

So, you know, I think from my perspective it is that plan early and plan often, right? It's getting those lawyers in place. It's getting their bankers in place, your investment managers in place and kind of starting say, okay, this is where we are today. And then thinking about where you want to go and understanding that we need some flexibility because where you are today and where you think you're going to go, that's going to change over time. So I think kind of coming to it with a flexibility mindset in terms of, okay, I've got my plan in place, but I'm always going to revisit it both from the business side and the personal side. I think that that just sets you up for a lot of success and kind of having those resources, those people you can call to say, this is my concern, you know, how can you help me? How can you help me quarterback that, knowing who those people are and surrounding yourself with the right team?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

I'd say just as a founder, you're interested in providing long term value and creating long term value. You want to find advisors that are interested in being long term partners with you, not somebody that's interested in pushing product, developing long term solutions, and understanding that it's not always going to go as you plan. So building and flexibility, having advisors that can show you how flexible you can be when times are tough is absolutely critical. As long as they're in it for the long term and they're finding solutions for you, not just some random product that's very exciting, right now... It's about long term partnership, and it's about solutions that can help you not only create value in your business, but allow you the time to create value in your business. And with that, you have bankers and advisors that are going to help in the short term, help you navigate the bumps that come along the way.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Theresa, you brought up a good point, which was around involving family, specifically kids and kind of the next generation. But what is maybe let's double click on that a little bit. Like what would be your advice to people as to how often or how early they get family involved in the conversations, whether that's a spouse, children, what have you? What are some of the best practices there?  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

I'm going to give you my lawyer answer. And it's it depends.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Okay.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

You know, I think the best practice is as soon as people are ready, right? I mean, I worked with some clients who whose kids are ready at the age of 18 and 20 and 22 because they kind of maybe they've worked summers in the business or, you know, they kind of just have a better understanding. And so they might loop them into the conversations earlier. I have some clients who say, you know what? I'm afraid if I tell my kids now, they're never going to get the foundation that they need to build their own careers and figure out how to build their own wealth. And so we're maybe waiting until they're in their mid 30s or 40s and kind of even up. I think the most important thing is, is you have the conversation at some point, right? I mean, the worst thing is when, you know, you know, maybe dad dies and nobody knows what's where or how. We got anywhere. And it's, it's a scramble. And so I think it's really important to have those conversations. A lot of times earlier, we will kind of focus more on the fundamentals. You know, how do you think about a budget? How do you think about, you know, kind of investments. Do you understand what a stock is versus bonds. So kind of start the education. Not necessarily. Here's what your parents have or here's what your grandparents have, but more here's the information you need so that when you do understand the dollar. So we'll start there. And then then maybe it's showing the estate plan without dollars and cents. So it's who's going to step into mom and dad shoes or who's going to step into, you know, the business or to run the family bank account or the family LLC, you know, really understanding who those fiduciaries are. And then as they get older or just whenever they're ready, then you start talking about dollars and cents and kind of how it all flows. You know, from a spouse perspective, I think it's always helpful to have both spouses at the table. You never know which spouse is going to predeceased the other. So I think the more knowledge both can have, regardless of kind of who's managing the wealth, I think it's really important to have those conversations so that there's a little bit more seamlessness. When a death or disability happens, I mean, it is a very tough time. And so if you can take some of that financial uncertainty out for the survivor, I think that that makes a huge difference going forward.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

It probably is one of those topics where people don't want to talk about it.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

Yeah, I always am a lot of fun at cocktail parties because I talk about death and taxes, and no one wants to talk about those things...  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

- A lot of founders and executives are generally pretty early on in their life, you know, might be in their 30s or 40s or even early 50s, like they're not really thinking about that yet. And but the truth is, it's too late if you if you haven't planned for it. So that that's a big point.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

And I think that that's you know, if I was talking about flexibility earlier, you know, it's hard to say to somebody, yes, you haven't major wealth, but please give some of it away before you even have it. Right from an estate tax perspective. But that's what we try to build flexibility into the documents to make sure we can take second, third, fourth looks through different provisions that we can incorporate into documents. So it's hard to make a decision when you're 35. So let's make sure that we can relook at that decision. So as your you know, as you have kids, as your kids get older, we can pull some levers to make sure that the document corresponds to what the current situation is.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Got it. Any final closing comments, concerns or words?  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

We really appreciate the time here. It's an exciting industry to be a part of, and there's a lot of value creation here. We'd love to be advisors here and help. There's a lot of things that we can do here, and we look forward to, growing with the client base.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

And I would just say for founders, you know, a lot of your focus very much on your business. So let somebody else help you on the other things with all of the different things that go on in the world. And it really helps you kind of bring it all together for, you know, the business and for the family.  

 

Paul McKinlay 

VP & Head of US Origination, CIBC Innovation Banking 

 

Well, thank you guys very much for being here, sharing your wisdom and insights. And, we look forward to working together.  

 

Kenneth R. Shogren 

Managing Director, Head of Illinois Private Banking, CIBC Private Wealth, CIBC Bank USA 

 

Thank you.  

 

Theresa M. H. Marx 

Director of Wealth Planning, Wealth Strategies, CIBC US Private Wealth Management 

 

- Thank you.  

 

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