Roger Philipp of UWorld Roger CPA Review

Roger Philipp of UWorld Roger CPA Review - Podcast Transcript

Scott:	Hey, it’s Scott Orn at Kruze Consulting and welcome to another episode of Founders and Friends. And before we start the podcast, let’s give a quick shout out to Rippling. Rippling is the new cool payroll tool that we see a lot of startups using. Rippling is great for your traditional HR and payroll. They integrate very nicely, but guess what? They did another thing. They integrate into your IT infrastructure. They make it really easy for when you hire someone to spin up all the web services in their computer, which sounds kind of like not a huge deal, but actually we did the study at Kruze. We spent $420 on average, just getting a new employee’s computer up and running and their web servers up and running. It’s actually a really big deal, it saves a lot of money. And the dogs are eating the dog food. Like we see a lot of startups coming in to Kruze now using Rippling. So please check out Rippling. Great service. We love it. I think we have a podcast with Parker Conrad. You can hear it from his own words, but we’re seeing them take market share. So, shout Rippling and now to another awesome podcast at Kruze Consulting’s Founders and Friends. Thanks.
Singer:	So, when your troubles are mounting in tax or accounting, you go it’s Kruze from Founders and Friends. It’s Kruze Consulting. Founders and Friends with your host, Scotty Orn.
Scott:	Welcome to Founders and Friends Podcast with Scott Orn at Kruze Consulting. And today my very special guest is Roger Philipp of UWorld Roger CPA Review. Welcome, Roger.
Roger:	Thank you so much for having me. It’s a joy to be here.
Scott:	So, this is a bonafide CPA celebrity. We’re super excited to be talking to you. I was telling you before I turned the mic on not just like the startup accounting community, but I think also a lot of our team members who’ve used your study materials will be excited to watch this podcast, but for those that don’t know, you are super, I would say world famous for CPA reviews and teaching people on how to prepare and pass the CPA. So super excited. Do you want to kind of just retrace your career a little bit and tell us how you got here and how you had the idea?
Roger:	Sure, sure. Well, I grew up in Los Angeles and when I was young, I was kind of an entrepreneur and I remember being in elementary school and I realized they didn’t sell candy and all the kids wanted candy. Right? You get your lunch money, you want to blow it on junk food. So, I went to this, I think it was called the White Cross. It was like a little five and dime store and they sold candy. And I remember they had a special three for a quarter, right? So being a future CPA accountant, I said, “Okay, break is like 8 cents a piece, plus tax. My mom drove me there, so the gas was free, didn’t have to add that in as an inventory cost. So, I’d buy candy and bring it to elementary school. And before school, the kids would come up, word got out that I had candy and the kids would come up and say, “How much is the candy?” And my response was, “How much do you have?” And the kids would go, “50 cents.” I’d go, “They’re 30 cents”, and they’d go, “Okay.” Other kids would come up. “How much?” “25.” “Okay. I’ll take it.” And so, the kid had like 15 or 20 cents. I go, “Come back to me later. If I can’t sell it for more sure.” [crosstalk] …8 cents. And that’s kind of how it started. So, I did that and I did that for months and I would home and we’re talking a long time ago because I ain’t young. So, I would come home with four, or five, six dollars, which when minimum wage was like a buck 50, and this lasted for weeks. And then one day my bag broke, and the teacher saw and he collected my candy. And after school he gave me back the candy. He said, “You can’t sell it anymore.” He goes, “You’re a good businessman, but you’re out of business.” So that’s kind of how I started. Then in junior high they were selling candy. So, I had to think of something else. Well, I had all this money I earned in elementary school. So, I became kind of a secure transaction, negotiable instruments. I loaned money. So, I would loan kids money, because everyone needs money, and I would take collateral. So, [crosstalk] that’s when I realized [crosstalk].
Scott:	…very smart to remember the collateral part of that equation, in junior high.
Roger:	Exactly. And that’s what I would teach on the CPA exam, secure transactions, negotiable influence. So, I would secure the transaction by getting collateral. I still have these coins, 1800 coins from the 1800, steel pennies. I got three mopeds out of the deal, and the kid would borrow money, I’d have him sign a piece of paper, not that he had capacity, but I would loan money knowing I would probably never get it back. So, I had three mopeds. So, my friends and I would play cops and robbers and race each other through the neighborhood. And so that was great. So, we did that. In 1980, I remember I did the US census when I was at high school and they offered me like $5 an hour, or I could get paid per form. And I pick the per form and I would work after school at 3:30, get out there, run house to house, to like 8:30, 9, to latest I could go. I ended up making like 30 bucks an hour in the eighties [crosstalk]
Scott:	Wow. And that was a lot of money back. Then that’s like a few hundred dollars an hour right now.
Roger:	Exactly. And I was 18 years old. So, that’s what I was. So, I went into college and then you had to pick a major, I go, “I don’t know. Let’s just do business.” And then you have to pick an option. So, I said, “Ahh, we’ll study accounting. I think it’s the toughest one.” My thought was, if I study accounting, I could learn the other stuff in the real world, like marketing, management, finance. But to me, accounting was like a language debits, credits, and so on, so I figured if I could study that, so I did that. Then I started working at Deloitte and Touche in downtown Los Angeles, which is a big four accounting firm, got my CPA certificate. I left there. And then one of my old college professors, I would run into him at these accounting events. These exciting meet the firms and banquets and all that stuff. And he would always say, “Come work for me.” And I said, “Eh”, so after about three years of working in public, I realized, I could make partner, but this isn’t my purpose. It’s not my passion. It’s not why I was put on this earth. And so, I left there and I started teaching and I loved it. All of a sudden, I was helping students accomplish their goal. I could use my personality, my energy, my passion, to help people get through this exam. And then eventually I became the lead instructor for his company. I worked for him for about 13 years. And then unfortunately he went bankrupt or closed his doors. And this happened on a Thursday. My paycheck bounced on a Monday. He went bankrupt and then all of a sudden, competitors were calling me, “Hey, come work for us”, and so on and so forth. And so that was kind of the pivotal point, like do I go this way and become an employee or do I go this way and become an entrepreneur? And I remember my grandfather who had a company in Germany, unfortunately he lost it in the thirties to the [crosstalk]. Yes. So, he had a huge factory, and he once said, you never get rich being an employee. You need to be an employer. And that stuck with me. So, then I said, “I’ll try it.” So, paycheck bounced Monday, formed a corporation Friday, started teaching Saturday, Sunday, and that’s kind of how it started. And then I would go to campus, and I had to do marketing. So, my girlfriend at the time, who’s now my wife and mother of my three kids. Luckily it worked out because I didn’t have a prenup, but anyway, but I love her to death. So, I would go to campus and I would sit in the student union writing books, accounting books, and then every hour I’d go to class, hand out a flyer and say, “Hi everybody. I’m here from [inaudible] view. Here’s my flyer, blah, blah, blah.” And I would do marketing and then writing books. So, every Friday night we went to Kinkos, Xerox the books I’d written, the chapters, and then hand them out Saturday, [crosstalk].
Scott:	Wow. So, like a real time book publisher, you’re doing the chapter at a time?
Roger:	Exactly. One chapter at a time, but I was teaching four different topics. So, I had to write four sections for each, for audit, far, reg, and BEC. But at the time it wasn’t BEC it was something else, but I had to write those all the time. So, that’s kind of what I was doing. And it was a lot of work, but it was exciting. And back in the day I would film the classes. Then I would take it home, and we had these things for you youngsters called a VCR and it’s like a set this big. So, we would film it, take it home. And I had 21 VCRs in my living room and every night I would put in the cassettes and they would record for three hours and it would copy. So, I had the main one and then I had 21 others. So, by the time you got to the [crosstalk]
Scott:	…God, the recording like real time recording or splicing, I guess. I don’t know. What’d you call that? Yeah.
Roger:	Yeah. By the 21st one was the quality dropped a little bit, but basically, we were like Blockbuster Video. Not that you know. Think of Netflix 30 years ago. Unfortunately, they didn’t keep up with the times and change. So, that’s what happened. And so, we went from VCR cassette because that’s kind of what we had, to DVDs to hard drives to flash drives, and now everything’s in the cloud. And it literally started in my garage. So, when they talk about a garage startup, this was in my garage where I’m started shipping books. And that scary thing was hiring my first employee, because all of a sudden you got to be paying 30 grand a year at the time for a shipping person. And you’re just hoping the revenue comes in. But really, we were… So, luckily, my girlfriend slash wife knew a lot about marketing. She worked at Sprint as a marketing and sales manager, so she figured out she set up our first website. So, we were probably the first ones in ed tech on the web [crosstalk].
Scott:	What year was that? What year did you have the website going?
Roger:	2001.
Scott:	Oh wow. You nailed it. Yeah. Perfect timing.
Roger:	So, all of a sudden today we’ve got students all over the world. I worked with schools in Japan, for example. I’ve flown out there several times to do presentations and speeches. And then in more recent years, we’ve merged with a company called UWorld who is a worldwide leader in online education for high stakes exams, like medical, nursing, finance, law, and now a CPA review. And so, I’m now my new title is chief creative officer. So, what’s great is you don’t really think about this when you start a company you’re starting, because you’re doing something you love doing. The bigger the company gets, at one point we were up over 60 people, that all of a sudden, you’re doing less of what it was you wanted to do, and more of just managing. Now in my new role with UWorld, we’ve got three, 400 employees, but what’s nice is I get to focus on what it is I love to do, which is helping people pass the exam. So, I no longer have to do day to day stuff, run the day-to-day operations, which is motivating and inspiring for me. But I also now have time to travel, spend time with my kids. So just kind of show that the hard work finally paid off.
Scott:	Yeah. Well, and you’re living happily ever after now, which is amazing. And you still get to do the stuff that you love talking to groups, helping people pass and doing stuff like this, so [crosstalk]
Roger:	I mean you spent a lot of hours a week working. I always tell students if it comes to the point where you’re working just for a paycheck, life’s too short. Start to look at whatever your passion is because death is [crosstalk] …escape either.
Scott:	For sure. And again, I can’t remember if I had the microphone going when [inaudible] but Vanessa, my wife, and our founder at Kruze Consulting took UWorld Roger CPA Review, that’s what she used to pass CPA. Kruze has been a UWorld Roger CPA Review client for many years. We’ve had a lot of people pass CPA. So, it’s got to be super rewarding for you to have like, had this positive impact, probably like tens of thousands of people, maybe hundreds of thousands of people, right?
Roger:	Yeah. Hundreds of thousands. Yes.
Scott:	Yeah. [crosstalk].
Roger:	…in your life to affect people in a positive way. I mean, you can get notoriety for doing bad things. It’s harder to get notoriety for doing good things. So, luckily, yes. The little bit of notoriety I got was from good things, which is, again, taking something that is difficult and breaking it down into an understandable format, making it exciting, motivating, entertaining, because you get home from work and most people would go, “Oh, I get to study defer taxes, woo!” So at least if it’s exciting, and interesting, and motivating, and understandable, you’re more likely to put the hours in that it takes to pass the exam.
Scott:	Yeah. Do you have people come up to you on the street and stop you and say like, “Oh, my gosh, 2012, your exam course got me through the whole thing.” Do you get that kind of feedback?
Roger:	Yeah. I mean, yes, but it’s not… I mean, I feel like a little bit of fame, not too much. What’s nice, you get recognized occasionally, which is nice, but in life it’s nice to have fortune and fame. It’s nicer to have fortune without the fame so you can enjoy your life. But yeah, just a little bit of fame is good. It’s cool.
Scott:	Do you ever have any stories from those early days. Like those moments where you’re like, oh my gosh, we’re not to make it like, like that, that sprinting to the Kinkos, and doing the VCR stuff at night. Was there ever a moment…? This is because I think I told you this, but a lot of our clients are entrepreneurs themselves. Like we focus on venture capital backed startups. So like everyone that we work with is going through those like highs, and lows that you went through as you’re building Roger’s CPA. Do you have any of those moments you can reflect on and share with the audience?
Roger:	I mean, for years while I was an employee, people would tell me, my students, your wife would come, not that your wife came under, but they would come up and say, “Hey, you should do your own course.” And it’s a little bit scary because it’s easier and safer to be an employee. There’s less upside, but also, you’ve got someone there to do that hard stuff. So, for years, people told me to do that, but I was very loyal. And then when my boss ended up closing his doors, it was like sink or swim. And we said, “Let’s give it a try.” And it was funny because I had just gone through this weekend course called Lifespring. I don’t even know if they still have it, but it was like one of those, gosh, I don’t remember. But it kinds of gives you the thing where you say, “Why not?” My philosophy was, should I start at my company? What’s the worst thing that happens is we fail. But what’s the worst thing that happens if I don’t try? I’ve already failed. So, you may as well try, but you want to make it smart. I don’t want to become a ballet dancer when I don’t know how to dance. But if it’s something that you’re passionate about and you think that you have some ideas that others don’t have, or there’s a reason to differentiate you from someone else, that’s where it’s going to come out. But your question about what scared me. Well, first of all, when I started the company, it was interesting because all of a sudden, the competitors who wanted to hire me are now attacking me and [crosstalk]
Scott:	And you were like going into some big companies there, right? Like it wasn’t a bunch of mom and pops you’re competing against [crosstalk]
Roger:	Like Kaplan, and [inaudible] huge companies. And who had endless resources compared to me, a little startup with one employee, my girlfriend. So, it was tough. And so, you start to take it personally. And then I realized Coke has Pepsi. Everybody has a competitor. Everybody’s out there hammering, you got to show why you’re better. Why the product’s better, what you offer. The marketing has to be better, everything. And it’s changed in the last 30 years that I’ve been doing. This has changed dramatically. I mean, back in the day, the way we marketed was handing out a flyer. Today with SEO, I mean, I spent thousands of dollars a month on SEO because I had to, because otherwise I wouldn’t exist. No one would know you exist other than word of mouth. But the biggest thing that scared me is we set up the company, created domain names and all that. And we signed up with GoDaddy and then all of a sudden, I remember I was on campus doing marketing and go look for my website. It’s gone. I’m like [inaudible] I called my wife and she’s like, “I don’t know.” And I said, “They stole it from us.” This, that. Well, what happened is she signed up and bought the site for a year, right? This is back then, you didn’t buy for 10 or 20 years you bought [crosstalk]
Scott:	Yeah.
Roger:	She had worked at Verizon when she started working with me and then she quit her job to work full time with me. Well, all the renewals went to her old Verizon email, so we never got them. [crosstalk] And I thought, for sure someone’s going to grab it, because I had said at the beginning and go, “If we don’t screw this up, as long as we don’t make a big mistake, we’re going to be fine. All of a sudden this was a big mistake. I have no website. Well, anyway, we got it back. Got it active. Everything was fine. Renewed it for the rest of our lives, but it was scary because you just don’t know what’s going to happen. So, that was a scary thing. Yeah.
Scott:	Especially back then when people weren’t super sophisticated about the internet, and domain names, I actually worked for JP Morgan on a M&A deal for narrower solutions. The company that made that did the domain names. And you’re not going to believe this, but in 2000, I think 2000 JP Morgan forgot to renew their domain too. So, you’re in good company there. Tell your wife that she’ll never have to feel bad.
Roger:	Yeah. We could all sync together. Yeah, so…
Scott:	Hey, it’s Scott Orn at Kruze Consulting. And before we get back to the podcast, quick shout out to ChartHop. ChartHop is one of my favorite new SAS tools on the market. And basically, what ChartHop does is it puts your org chart in the cloud. And I always like to say, it brings transparency to your organization. So, everyone in your organization can see who they report to. They can see the full or try the company and how their group relates to other groups. It also has a lot of information on the individuals in the company. And so, you can click on the ChartHop profile and just get like where people live, their experience, Slack handles all this kind of stuff. And it’s just a really great tool. The other thing is ChartHop has started doing some cool stuff around compensation and budgeting planning. And so, you can actually start seeing like what the cost structure of the company looks like during certain kind of scenarios. So, I’m loving ChartHop, check it out, charthop.com. We use it at Kruze. We really like it. And I can’t recommend it enough. All right. Back to the podcast. You overcame some of those like heart attack moments was there a moment kind of like early on that you’re like, “Oh, my gosh, this is going to work.” Like you said [crosstalk]
Roger:	I said, if we can make [inaudible] I said, if we can make a hundred grand our first year and we made more than that and I was like, “Oh, I think we’re going to make it.” And so, and then you want to start deploying resources, but you want to be careful. You don’t want to grow too quickly. You don’t want to make bad decisions. And then everyone who wants to come help you spend your money, whether it’s good social media people or marketing people or advertising people, where everyone has, “Oh, this is going to work.” And then you’d have people that really don’t understand your industry. And that’s the thing, like they say “Here, put an ad in this magazine.” You’re like, “Nobody reads that magazine that wants to come spend a couple of thousand dollars on a CPA review course, or a medical licensing exam”, or something like that. So, it’s yeah. So, you’ve got to be wise in how you spend your money, and also, just like I said, understand the industry you’re heading into.
Scott:	Yeah. It’s great that you had kind of a trusted partner in your girlfriend then wife. I mean, Vanessa and I’ve lived that relationship too. Like how did that work for you? And were there any moments where you just gave each other a big hug, and said, you’re so happy to be on the journey together?
Roger:	Oh, yeah. I mean, I think, I always say together we’re a complete business person, because I’m good at certain things. And luckily, we counterbalance, she’s great at other things. And together we’re like a smart person. Individual, I mean, she’s smart without me. I’m a little bit… So, but it was great because I was the product and I knew the material and the… And I ended up with the industry because I’d been in the industry already for 13 years. So, I understood it and I had taken products so I understood it. That was great. The things I didn’t understand was the marketing side or she’s really smart. She can read something, understand it, apply it. She set up our website from scratch without having any experience. She did all the research. She found GoDaddy, she registered domain name. I mean, there’s just… And then as you start going, then you got to get insurance and then you got to figure how to keep people motivated and how to… And I had people, there’s still people around that have been with me 15, 18 years.
Scott:	Wow, that’s beautiful. I love it. That’s really awesome.
Roger:	I learned that in life too. You’ve really got to take care of your people, because there’s plenty of options and opportunities out there. But one of the things that I tried to give my staff was a good quality of life. And that way… And they could also see, I had to lead by example that I worked hard. I mean, especially in startup, you’re working 16, 18-hour days, seven days a week. Luckily, we didn’t have any kids yet. So, my kid was my business. And then once it starts to grow, then we decided, “Okay, let’s have a family.” So, once the family came and then all of a sudden, luckily, I had more employees, so the wife could kind of drift away. And then I got people that studied marketing in college or studied IT in college. So, then I got experts, and I’ve learned you could have a great resume, but not perform on the job. So, you’ve really gotten rid of these people you’re bringing in, mentor them, give them direction. But I was smart enough to know what I didn’t know. So, I could hire the right people to fill those gaps.
Scott:	Yeah. You talk about setting a good example of working really hard, which I totally agree with. But one thing we’ve kind of learned once we kind of got established was when you have to set that good example about taking a vacation and having work-life balance. Because if you, Roger, or Vanessa or aren’t demonstrating that everyone should have work life balance and people will follow your lead and the organization can blow up. So, I’m sure you’ve kind of learned how to dial it back a little bit and pick your battles and enjoy time with your family as well.
Roger:	I agree you need a balanced life, but that’s also why I waited to have kids too. I mean, I’m an old dad, but I also knew that I wouldn’t have the time and attention while I’m starting to build a company. And so, but yeah, work-life balance is really important. One of the nice things now, I just came back from a vacation and I still check email every day and several times probably every hour, if not more, but at least the day to day fires someone else is putting out. But when it’s your own baby, you’re on vacation, you’re still working. I mean, you still got to make plans to deal with this, that and the other. And I remember you come back from vacation and you’ve got the stack of mail this big, you got 50,000 emails. And so, it’s something that you just kind of get used to working all the time. Luckily, if you’re passionate about it, it doesn’t seem like work. Your wife now she’s like, “Get off the internet, do this. Take the kids to get the pool.” But when you’re when you’re startup mode, you just got to be laser focused, and but you also they always say, keep your friends close, and your enemies closer. So, you’ve got to know what your competitors are doing, what they’re saying about you, thinking that too, because it’s a any industry it’s cutthroat.
Scott:	Yeah. Especially, I mean, you’re in a very competitive industry. Well maybe you can tell everyone, like again, we’ve used UWorld Roger CPA Review at Kruze. My wife’s used it. She passed her CPA. Maybe you could tell everyone where to find you. Are there samples people can try? Are there other talks that you’ve done on the internet where they can learn a bit more about your background? Like how can people find more information about UWorld Roger CPA Review?
Roger:	Sure. I mean, you can look on, I’m all over YouTube, all over the internet. Looking at UWorld Roger CPA Review Review, or UWorld/UWorld Roger CPA Review Review that’s to find out you can see sample presentations. I mean, I’ve done speeches, and presentations on setting goals and achieving success, and motivational type presentations. I’m actually doing one in a couple of days for the beta alpha side nationals, which is the honor society for accounting at all the different universities. And every year they have meetings and they have different presenters. So, I’m talking about I spy a leader. What do you have to do? Here you are a kid graduating college, starting out and you’ve got these lofty goals. I’m going to tackle the world. And then all of a sudden reality hits you in the face. And you’re like, “Wow.” So, that’s where you got to kind of… I tell people, reassess every year, sit down and look at it and say, “Am I still heading in a healthy, positive, exciting direction? Or am I not enjoying my life?” Because if you’re working nine to five, five days a week and you’re getting a paycheck and that’s it, you’re not really motivated. So, find what that motivation is, but you could also have a job that pays you well, but then on the outside find that motivation or where you can kind of incorporate both. So that’s [crosstalk].
Scott:	Well, you’ve done both. And I mean, it’s great to meet you. For folks who don’t know, just Google, UWorld Roger CPA Review. You’ll either you’ll come up with like a UWorld URL and you can subscribe to there. And again, if you work at an accounting firm, oftentimes your accounting firm will actually help you with this as well. We’ve done that in the past a Kruze. So, don’t be shy. And again, it’s been very helpful for our team members who have passed CPA. So really, really recommend this service.
Roger:	Thank you. Yes. And encourage your employers to support our courses.
Scott:	Yeah, totally. [crosstalk]. It’s in everyone’s best interest. It’s in everyone’s best interest.
Roger:	Yeah, yeah, yeah, no, I agree. It’s important.
Scott:	Cool. Well, Roger, thank you so much. Really appreciate it. You’re an awesome guest, entrepreneur inspiration, and again, we’ve used your service so many times and just really want to thank you and glad you could be on the podcast.
Roger:	Well, thank you so much. I appreciate it, and good luck to you as well. And all of you out there.
Scott:	Thank you, sir. [crosstalk]
Singer:	So, when your troubles are mounting in tax, or accounting, you go to Kruze from Founders and Friends. It’s Kruze Consulting. Founders and Friends with your host Scotty Orn.

Roger Philipp of UWorld Roger CPA Review

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