Ron Bland and Dillon Castro of AEIS Advisors explain how startups should offer health benefits

Ronald Bland & Dillon Castro of AEIS Advisors - Podcast Transcript

Scott:	Hey, it’s Scott Orn of 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 and their computer, which sounds kind of like not a huge deal, but actually we did the study at Kruze. We spend $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, saves a lot of money. And the dogs are eating the dog food. Like we see a lot of startups coming in. Kruze is now using Rippling, so please check out Rippling. Great service. We love it. I think we have a podcast of Parker Conrad. You can hear it from his own words, but we’re seeing them take the market share. So, shout out to Rippling. And now to another awesome podcast at Kruze Consulting’s Founders and Friends.
Singer:	So, when your troubles are mounting in tax or accounting, you go to Kruze Founders and Friends. It’s Kruze Consulting, Founders and Friends with your host Scotty Orn.
Scott:	Welcome to Founders and Friends with Scott Orn at Kruze Consulting. And my very special guests are Ron Bland and Dillon Castro of AEIS Advisors. Welcome guys.
Dillon:	Thank you for having us.
Scott:	Yeah.
Ron:	Thanks.
Scott:	So, Ron, you’ve been doing this for quite a while… You look young, but you have a lot of experience. Can you tell us how you had the idea for starting AEIS?
Ron:	Yeah. Back in 85 I was doing life insurance for business owners for estate planning, for estate taxes or for estate liquidity so they could keep their children all the same equally. And they all came up with the same thing asking me about health insurance and they find that they were paying too much and they weren’t getting quality for their service that they were paying for. And that was back in ‘85 and so we just started working with more and more businesses and kind of working, focusing now more on startups cause that’s the economy in this area.
Scott:	Yep. And you guys are one of the last independent firms, right? That’s a big deal in your industry.
Ron:	Yeah, there’s been a huge consolidation, a lot of mergers and acquisition, a lot of private equity money buying them out at unreal multiples.
Scott:	Yes.
Ron:	But we like our independence.
Scott:	That’s good for you in the long term.
Ron:	We don’t play well with others.
Scott:	And Dillon, how did you end up at AEIS?
Dillon:	Well I was recruited into AEIS by Ron. He’s worked with other producers in the past, which is benefits consultant, what I do, but hadn’t brought somebody on that was sort of a junior associate to learn the ropes from him and eventually work with a lot of our clients who are facing different challenges, new things. And it’s kind of nice to be able to be new blood in a very old industry that has a lot of status quo.
Scott:	Yeah.
Dillon:	Kind of going on in it.
Scott:	You also have a great mentor and someone to learn from.
Dillon:	Indeed.
Scott:	And for the folks in the audience, I was talking to my friend Matt Donaldson at Rippling and the bottom line is you guys are the best brokers in the area who work with startups. And so, I wanted to have you on the podcast A) so I can learn more about it and B) so our audience can learn more about it because the podcasts often end up as kind of a tutorial for our CEOs. And so, let’s kind of cover all the different health benefits ancillary benefits and the things that are happening in the industry. And we’ll go from there.
Dillon:	Sounds good.
Scott:	Cool. So, everyone always probably starts focusing on health benefits, like a medical benefit. So, when someone like me comes to you and says, Hey, I need, can you do an audit? Can you check my benefits? Or Hey, I need to set something up. How do you kind of walk them through the process and what are the important things to focus on?
Ron:	So, one of the key things, it’s kind of like a restaurant that has a high lease payment. It’s kind of like for employee benefits. What’s your contribution modeling? Are you paying 90 to 95% for employees and no more than 50% for dependents. And the reason I say that is the lock over there only keeps the honest person out on the front door. And so, if I pay 100% for everybody, as you start to grow, people will take your benefits even though it’s free. But if you charge people say $25 a month and still pay 100% then they won’t take your employee benefits. We don’t like going more than 50% for dependents because we end up subsidizing our competition because people will bring their dependence over to you and cut a side deal out with their employer.
Scott:	Oh wow. I didn’t know they could do that. So, the general, the average venture capital startup kind of does what 90% and 50% employee payments or paying for the employees on benefits.
Ron:	Most of the startups who do now are well funded.
Scott:	Yeah.
Ron:	So, they have to do that because the people are 28 to 32 they’re starting to have kids, so we need to contribute for dependents if we want to keep them. It’s not like 2008 where people were lucky to have a job. It’s extremely competitive. We’re seeing a lot of people go out of state to get people for that aspect, but it’s all about retaining people and keeping them. And a lot of times you’re picking off people from one of the fangs and so we have to…
Scott:	That’s Facebook, Amazon.
Ron:	Apple.
Scott:	Netflix, Google, Apple.
Ron:	Yep. Everybody. So, when you start to get those highly compensated engineers you need to offer, you can’t just offer it as a typical bootstrap employee only benefits. It’s not really appropriate.
Scott:	Yep, yep. We see that too. Like we typically recommend if you’re recruiting the top engineers in the Valley, you’re going to be a hundred percent coverage.
Ron:	Correct.
Scott:	And really take care of people and make sure they’re good. Is that kind of the same thing you’re seeing?
Dillon:	Yeah, it is definitely what we see. And I think adding on to what Ron said, one of the things I caution a lot of startups about, to think about it from the perspective of when you’re setting up those initial contributions, it’s a lot easier to later on say, hey, you know we’re going to go from doing 50% for dependents all the way up to 75% for dependents or some kind of increase on the contribution.
Scott:	Mm-hmm (affirmative), mm-hmm (affirmative).
Dillon:	It’s a lot tougher of a conversation when you’re a couple of years down the line and you have to tell everybody, hey, we’re going from paying 100% of your benefits to now 75% because it comes a pay cut and certainly doesn’t go over very well with the employees.
Scott:	Yeah, people don’t always like that. Yeah, I totally get that. And so, when you’re looking at the different plans, like what are you seeing are the most popular plans, most popular carriers, providers. What do you see in the market right now?
Ron:	So, the plans are kind of like the Olympics. There’s gold, silver and bronze. Gold is the best. Silver’s normal. Bronze is cheap to buy, expensive to use, unless it’s an HSA and then platinum is more for somebody that came from a Fang or somebody that sees the doctors four to six times a month is kind of what we’re seeing more in the marketplace for that. Blue Cross is very startup friendly for that asset, but all the carriers are, you know, there’s only a handful of carriers versus the 50 when I came back in ‘85.
Scott:	Oh wow.
Ron:	There’s just a handful anymore.
Scott:	Yeah. Anthem Blue Cross is one of the ones that…
Ron:	Absolutely, yes. Yeah. They worked very well out of state as does Blue Shield, United Healthcare and Cigna.
Scott:	Yeah. And do you see people opting for like the PPOs, the HMOs, Blue Cross or what do people typically do?
Ron:	In Northern California’s PPO country, Sutter’s up here. So, they’re very predominant. So, Northern California is PPO where if we have people that have satellite offices in Southern California, Southern California is very HMO.
Scott:	On, interesting.
Ron:	Yeah.
Scott:	What’s caused that? What’s the difference?
Ron:	Well, I feel that up here, Sutter is predominant and so down in Southern California, the HMOs, they compete. So, there’s lower rates and HMO side.
Scott:	Yeah. And Dillon, can you maybe explain what a PPO is and what an HMO is so the audience understands the difference?
Dillon:	Yeah, yeah, sure. So, I think traditionally people think of HMO, they think of something like Kaiser and Kaiser is certainly not the only HMO, but the vast majority of HMO plans are going to be in essence, narrower network. So, you have a smaller list of providers that you’re able to see. But ideally the costs are a lot more controlled because of that. It stands for Health Maintenance Organization. A PPO, which stands for Preferred Provider Organization, allows people to have a little bit more free access to a number of different medical groups and carriers. But because of that, you have a lot more players involved as far as the medical groups you can see. So, the costs are usually a little higher.
Scott:	Yep.
Dillon:	But some people prefer that, especially if they have more, you know, acute diseases or other health concerns that they have to worry about. They want to be able to go see a specialist without having a referral, be able to go to different medical groups, move in and out, as opposed to being sort of strictly with one.
Scott:	Yep. That makes total… Or maybe the age groups.
Dillon:	Yeah.
Scott:	Younger people do HMO. Older people do PPO because they’re getting sick more often and things like that.
Ron:	A thousand percent we see a lot of people that are on pregnancy that they’ll pick the platinum plan to start off with because it has a low out of pocket. Then after the child will downgrade to the gold or they’ll switch to the HMO for a year cause it’s $500 a day hospitalization or admission fee.
Scott:	Yep. Makes total sense. And then you mentioned Kaiser, that’s the big HMO we see in Northern California which people often choose. Is that consistent with what you guys are seeing?
Ron:	Yeah, they have about 53% market share.
Scott:	Wow.
Ron:	They’re getting more and more. But you know, usually 20% of any groups in this area likes Kaiser. It’s usually 20%.
Scott:	And is it possible for startups to choose both? Like make that available for Anthem Blue Cross and Kaiser.
Dillon:	Yeah. In fact, going back to your question earlier about trends that we see, I think that the biggest or one of the biggest ones is that we see a lot of companies wanting to offer a lot of flexibility to their employees. Some employees want to have Kaiser, maybe not even for the cost reason only, but they might just be comfortable knowing I can just go to the big building that says Kaiser and know that I’m covered there. As opposed to with a PPO you might have a little bit more of an arduous process of finding which providers you can see.
Scott:	Which doctor, yeah.
Dillon:	It just makes it more involved and some people prefer to have it be maybe a little bit more autopilot. But yeah, there are a lot of ways that people can have a mixture. And I think that that’s maybe that, again, one of the things we come across the most, especially with small startups, there are companies like Cal Choice or Covered California for small business that make it convenient because then there’s not any need for there to be a certain amount of participation with one carrier or another. Whereas if you work directly with Kaiser and Blue Cross, for example, one company or the other’s going to want a certain percentage of the people with them.
Scott:	Yeah. Is that because of just economics or adverse selection or why do they make that demand?
Dillon:	I would say it’s more the latter. What you just said. Adverse selection.
Scott:	Yeah.
Dillon:	The Affordable Care Act kind of made things a lot more interesting for carriers in that respect because they have what’s called now it’s small group, everything’s guaranteed issue, meaning that, you’ve probably heard before that the Affordable Care Act banished things like pre existing condition clauses in health insurance contracts and so they already have to deal with a lot of adverse selection just based on the governance that we have now.
Scott:	You can’t say no basically kind of thing.
Dillon:	Yeah.
Scott:	Yeah.
Dillon:	And so that’s one of the ways that they can still sort of control that. So, I think that that’s the biggest reason.
Ron:	Yeah, we find that over the years when we first started off the carriers one of the hard fast 75% with a non-Kaiser and now they all have relaxed participation. Like we just want to get some of the group.
Scott:	And help the growth inside the group.
Ron:	Exactly.
Scott:	Yeah, makes total sense. And then in terms of like other types of coverage, like vision, dental, you know, what do you guys recommend? What are you guys seeing out there?
Dillon:	So vision and dental they’re interesting because I think I’m going to speak to it in kind of different stages of startups because right, I’m sure you guys come across this, there are some startups that are well past 15 or 20 employees that are still considering themselves small and growing, but then they’re really, even the micro ones, the group of just three or four founders who just got funding and they’re just starting to kind of make their way. With those smaller groups, there’s certainly a lot less options or variety of options I would say. That being said, you know, usually people just kind of want something kind of that checks the box in the beginning. You know, whether that’s a Delta or Guardian, some company that they usually have some name recognition with and they have maybe an experience. Oh yeah. You know, when I worked at such and such company, I had Guardian, or I had Delta or what have you. But as things move along, once you get past 25-30 employees, we start even looking at other opportunities specifically for things like dental, looking at whether it makes sense to sell fun dental…
Scott:	Interesting.
Dillon:	Or other sorts of, rather than just spending dollars on a one-way trip to an insurance carrier, kind of seeing if there’s a better way economically to handle it.
Scott:	Yeah. Yeah. Is there a threshold for self, I didn’t even know you could self-fund your dental, is it like 30 employees and then it starts making sense for you? Or…
Dillon:	I’d say like 20-25 employees is where it starts being a conversation that maybe one would have. Especially what we always look to do with clients who kind of hit that range is look at what they call a loss ratio. So, with any insurance, right, there’s always how much premium is an insurance carrier taking in? How much are they paying out in various claims, whatever kind of insurance it might be. And dental is one where you know, you do see quite often or people might be in a range where they’re paying a lot more premium than they’re sort of getting back if you will.
Scott:	Yeah, yep.
Dillon:	And so being able to kind of look at that, look at those numbers and see if it makes sense. For some companies it doesn’t make sense, but for some it does.
Scott:	That’s really interesting. I’ve heard of self-insured, like big companies, corporate companies, you know, self-insure but I didn’t know you could do that at kind of the 30 40-person range.
Dillon:	Yeah.
Scott:	That’s really interesting.
Dillon:	Dental can be an easy way to, for lack of a better phrase, to dip your toes into the water for that. Because you know with the dental plan you’re looking at $1000 to $2,000 benefit per person. So, you have somewhat of a capped liability with that.
Scott:	Yep.
Dillon:	Versus with the health part of the really big reason you have a health plan is to kind of cover the ceiling.
Scott:	Kind of [inaudible 00:13:45].
Dillon:	Yeah, I mean any day you could wake up and have a million-dollar health insurance claim and you want to make sure you’re covered for that.
Scott:	Yep. Makes total sense. So, what’s the bottom line advice like, Ron, I’m a 20-person startup. Just raised my series A 10 million bucks. I’m taking over the world. I come to you and I need health, I need dental, I need vision. And I’m in California, in Northern California or LA, what are you going to put me on?
Ron:	So probably what we want to do is establish a baseline. What will the company pay is probably the gold plan? We see a lot of companies do the platinum plan and then a year later they have to downgrade or they start to grow. And I don’t want to play platinum for everybody for that aspect. The other item is we want to offer dental, vision, life and disability. You know, dental everyone’s used to, they’re used to having it. It’s really, it’s not insurance, it’s more of a financial arrangement with the insurance companies.
Scott:	Yeah.
Ron:	Dillon was talking about dental.
Scott:	Doesn’t cover a ton but at least you get your cleanings, right?
Ron:	But everybody wants it. Every spouse wants it that you have it, et cetera. For that. The vision is usually VSP even if it’s with Guardian or Met, you know the VSP is like the gold standard in the vision area. Life insurance it’s usually one to two times the salary or a flat 50,000 but life insurance, you know if I die I have no more problems. Everyone else does but I don’t.
Scott:	Except for your family.
Ron:	Exactly.
Scott:	They might have an issue.
Ron:	But you know you can get better rates, but the other one I want is disability cause that’s paycheck insurance because I still have the credit card, I still have the rent, I still have the mortgage, I still have the car payment so we really take a look at it. We want to take a look at disability insurance. That’s one of the key phrases of once you get a firm that size is really protecting the employees. Because if somebody gets cancer, I can either send them a get-well card or I can send them a paycheck.
Scott:	I love disability and life insurance. We actually put that in place at Kruze about 18 months ago. As we were having a child and I started thinking about this kind of stuff, but like maybe have you heard some nightmare scenarios where people didn’t have disability or life insurance and then the company goes down or the key people, you know something bad happens they have to leave because they’re not covered.
Ron:	Exactly. The key is, you know if one of the founders goes down their buy-sell key person insurance, they usually do that with one of the funding mechanisms is that we have to ensure the Rainmaker for that, but more on the disability side is people don’t really add disability or they just take the boilerplate information and then they see what could have been paid for a disability. A claim didn’t get paid because they didn’t put the right phrase in. They didn’t put the right contract language in and that’s when they corrected. We have a large CPA firm who shall remain nameless that one of their partners didn’t get paid because the right box wasn’t checked.
Scott:	Oh my gosh.
Ron:	We got referred to them.
Scott:	Yeah. And it might’ve been an easy sell for you.
Ron:	Yeah it was, but you know, it just wasn’t correct. And so we got it fixed, et cetera. It wasn’t explained to them correctly. A lot of times when people buy life or disability, they get it off the shelf. They just don’t really analyze what needs to get done.
Scott:	Yeah, yeah, yeah. What percentage of venture startups are you seeing that actually do life and disability? Is that common or not common?
Ron:	If they grow, they kind of go through, they get their funding and they get enough funding for the health and then they start to add dental, vision, life and they want the bundled discounts. But usually it’s because something happened to somebody in the past and that’s why they want it. But we’re starting to see more and more now, especially as once you get above 15-20 employees, you really need to protect your employees. The cost of disability is about the same as the cost of dental. Well I’d much rather have disability than dental.
Scott:	Yeah, that makes sense. Yeah. I was actually surprised at how inexpensive it was. It wasn’t too bad.
Ron:	Yeah.
Scott:	So, I’m glad we did that. So, your bottom line advice is someone comes to you, Anthem Blue Cross or Kaiser HMO determine the gold, silver, bronze and what you’re going to pay. And then something like Guardian and Delta for vision, dental, and then…
Ron:	We shop all the markets. Everybody’s hot. We like Blue Shield and like United Healthcare, we love Cigna. Cigna is a level funded product. If you’re over 25 so you’ll pay X number of dollars every month. You can never pay more than that. And if your claims work out well you get 50% of the claims bucket back.
Scott:	Maybe talk about just shopping the market a little bit because I’m not sure people quite understand what goes into actually developing the plans and what’s the best deal for the company. You know for us and even our clients especially, they are saying like, hey, what should I get? And then it’s usually Anthem Blue Cross or Kaiser, but what is actually shopping the plans, like how do you work for them on their behalf to get them a better deal or more coverage per dollar.
Dillon:	So, with small group health plans, a lot of times what we’re looking to do is something that Ron just mentioned, which is looking into sort of nonstandard small group health plans. Something like what’s called a level funded plan for example. I won’t get too technical unless you want me to, but with the Affordable Care Act, one of the things that changed with the health insurance aspect is that everything is sort of predetermined cost wise as far as any given employer is going to, if you go into five different brokers gave him the same information, asked them to quote you the same plans, you should get five identical quotes.
Scott:	Yeah, yeah.
Dillon:	As far as the health insurance is concerned. So, in that aspect, there’s not necessarily a whole lot of room to maneuver with a five-person group with Kaiser, which we get that from, you know a lot of times we’ll have somebody that says, Oh, well we have Kaiser bronze plans, we’re paying a lot. How can we pay less?
Scott:	Yeah.
Dillon:	And you know those folks, we’ll do what we can but when you have a group that’s maybe like Ron said, that’s approaching that 20 or 30 threshold, we start looking at different funding mechanisms to kind of give the company a little bit more of a fair shake at it because the reason that these small group plans are priced the way they are is that basically everybody in a county is kind of grouped together.
Scott:	Oh, that’s how you get in a pool.
Dillon:	Yeah.
Ron:	Yeah, they go by employer zip code. It also has to do with if the firm has employees out of state.
Dillon:	Well if they have employees out of state, you know, ideally, we will look at obviously ways to get them covered cause it happens more frequently than you’d like to know where they’re not adequately covered or you know, we can look at, again especially if we’re looking at a kind of a nonstandard, especially like these level funded plans or some degree of self-funding. You know we live in one of the areas here in the Bay area that’s one of the most expensive, not only obviously from cost of living standpoint, but even the different medical groups here. The different physicians, providers are some of the most expensive. And so, when we have a group that’s very out-of-state laden, their claims are usually going to be a little bit lower by comparison when it comes to that or there is other ways such as something we see some other clients, well here in California there could be a plan that’s a select or very narrow plan as far as the provider groups that are available to you. But then outside of the state that select network here in California might be a full network outside of state. Blue cross is a big one. We see that with Blue Cross and Blue Shield because here in California they’re separate companies and in a lot of other States they’re the same company. So if you have a narrow network plan here in California, if you have an out-of-state employee on that same plan, they have access to all the Blue Cross Blue Shield providers essentially in that state.
Scott:	In that state. That makes total sense. Well, you brought it up actually the remote aspect and the startups are doing that a ton now, including us. Like almost all of our hiring is out of state now because we just find really awesome people and it’s just, it’s easier to find them and they enjoy working with great startups. But how has that trend kind of shifted your guys’ business and the services you provide?
Ron:	So, what happens is, that we’ve had HR and we have an ERISA attorney on retainer because when you’re out of state, it’s a different set of rules for every state for that aspect. So, one of the things that we’ve become involved with is most of the firms have what they call telemedicine. We call it virtual urgent care so that people can go and talk to their doctor and get their results online. But when it comes down to the health insurance for the people out of state, we need to find out if it’s Blue Cross or Blue Shield. They have reciprocal with other States. But other carries, we only want to do that have a national presence because there’s some carriers that just are not appropriate for out-of-state people.
Scott:	You could end up with your out-of-state people not covered.
Ron:	It’s a very limited. When you hear the word limited select, that means skinny, narrow, hardly any doctor. Limited or. Select is not a good phrase in the insurance industry.
Scott:	I love it, I love it. When a startup comes to you and is like, Hey, we got to grow our headcount 50% next year and the only way we’re going to be able to do it is hiring in all the States across the country, what do you tell them? Like what’s the answer for them?
Ron:	So, with the more than 51% then we’re limited to the number of carriers. Like we could write a group and they have more than 51% but then they get the chance of getting audited or re certified. So, then we have to put them with the right carrier. So, if they say have 25% in California and 75% spread out, we have to do the analysis to make sure that we put them with the right carrier.
Scott:	Got it.
Ron:	So, it’s more sustainable for that aspect.
Scott:	Got it. Once you go remote, you’re probably going to go remote harder as you get used to it and as it starts working. So are you seeing that with the growth outside of California actually or in New York because New York’s another place where we have a lot of clients, accelerating or how’s it looking from your guys’…
Ron:	New York is the Empire Blue Cross Blue Shield. So, if I have Blue Shield or Blue Cross here, they get access to the network out there. We’ve actually placed a couple of groups with PEOs because they have so many people. There’s no real domicile, not in California, but et cetera. So, we work with TriNet, Insperity on more of finding then the appropriate ones because if I start to get like 10 or 12 or 15 different states now, how am I going to keep track of all those different laws, et cetera for that.
Scott:	Yeah. Maybe talk a little bit about a PEO and the service they provide Dillon.
Dillon:	Yeah, so PEO stands for Professional Employment Organization. A lot of people are probably most familiar with TriNet. They have a lot of billboards around here in the Bay area. A lot of advertisements. Basically, the point of the PEO model is to group a number of like employers together. They enter what’s called a co-employment relationship with somebody like a TriNet or an Insperity, whatever the company is. And ideally the value proposition of that is that they, you know, receive a lot of human resources, administrative, payroll help and then benefits and usually workers comp are kind of added into those. We work with these PEO companies as kind of an ally in a lot of ways. And we kind of explained this a little bit off air, but we’ve had instances where on the PEO side it can be nice to have, we can sort of act as another advocate. We’ve had instances where maybe a client had an issue that they weren’t able to sort of get resolution on and they were able to come to us because we helped place them with a said PEO and we were able to kind of escalate the issue, make sure that it was addressed and that things get properly processed afterwards. We had one instance where we had somebody who had an employee in Texas that was getting California state taxes withheld from their paycheck.
Scott:	That happens more than people know.
Dillon:	Yeah, right?
Scott:	The old refund and rerun kind of thing, yeah.
Dillon:	And so, with something like that, for example, we had this employer that was kind of hair on fire about that. And rather than having to go through the normal channels, they were able to kind of just come to us and, and allow us to sort of do what we do with carriers too, which is rather than you be on hold with Kaiser, you come to us and you talk to us about something that’s going on and we try to make it so you don’t have to do that.
Scott:	That’s the name of the game and the name of our game too. I love it. So, when you look at the spectrum of choices for a startup, there’s PEOs which is like TriNet, Just Works, those folks, you have someone like Gusto who’s becoming your broker and they have someone like Rippling who’s becoming your broker I think, or they’re letting you work with your existing broker like you folks. How does that play out? Like kind of what’s the best option for startups?
Dillon:	I’ll give you our biased opinion on that. What we think is that, and I think that you even were the first person that kind of, we’ve heard this from as far as a channel partner kind of group, but you realize that sometimes people need a more customized solution. Benefits kind of aren’t one size fits all and usually the model that sort of keeps up a traditional broker outside of it is usually going to kind of run on that modus operandi of we can just again check the box, just do it as opposed to really think putting thought into it. I think one of the things we look at is don’t just think about the here and now today. I mean you’re a startup, you’re trying to get to someplace, think about where going to be in the future, where you’re going to be tomorrow and set up everything in a way that’s going to be conducive to growing in that direction. Because we see a lot of times with, again with a solution that sort of is anti-traditional broker, it’s usually a more of a shortsighted gain and if you end up having to change when you’re a 50-person company, business is cooking, it’s a lot more difficult than just getting things set up right when you’re a five-person group of just founders.
Scott:	For sure and I think also just adding on to that like remote team members has really made things a lot more complex, so that definitely makes sense to sit down with folks with your expertise and actually customize something. No start up is exactly alike. No start up is plain Jane and like you said, they’re all working really, really hard to go somewhere and so why not do it right to begin with and also help your recruiting, like being able to attract the best engineers will actually really help your company accelerate.
Ron:	Absolutely. That’s why we like Rippling so much is their ability to grow with the client. If the client grows from 10 to 15 to a hundred, Rippling is a perfect model for them.
Scott:	Yeah, I like that company quite a bit. Let’s talk about like you guys have been incredibly generous with your time, so thank you for coming by, but what are some of the like the punch list for a CEO as they come on to Kruze, we start setting them up. What are the core things they need to think about and core decisions they should then discuss with you guys over their benefits when you’re talking about their benefits and other stuff?
Ron:	Well, I think for myself and Dillon it’s more of asking if we were to be here three years from today, where do you see yourself at?
Scott:	Yeah.
Ron:	How many more people am I going to have you out of state. Am I in state? Am I recruiting from the fangs? Who am I recruiting from? How much am I going to have offshore, international? Where do you see the self-company at so we can position it in the right way now? Again, it’s like on the employer contribution, everyone gives 100% for employees. We prefer 90 95 or 100% just charging a small fee, but I don’t want to, as Dillon mentioned early, I don’t want to have to go back if there’s a downturn and ask the employee to give more cause it’s giving them a pay cut.
Scott:	I totally get that. Thank you so much for coming by and discussing this. This is like super technical and I want to have you guys on because I wanted our startup CEOs to be able to hear it from you guys and explain it and thank you for your time. I really appreciate it. Can you tell everyone where they can find AEIS and how to reach out?
Dillon:	Yeah. AEIS, we’re in downtown San Mateo.
Scott:	Definitely a website.
Dillon:	Phone number is (650) 348-6234. I’m at extension 30 Ron’s at extension 12 our website is AEIS advisors and advisors spelled A D V I S O R S .com.
Scott:	Awesome. Ron, thank you so much.
Ron:	Thank you.
Scott:	Dillon, thank you for coming by.
Dillon:	Thank you, Scott.
Scott:	You guys have a great day.
Ron:	Thanks.
Dillon:	Thank you.
Singer:	So, when your troubles are mounting in tax or accounting, you go to Kruze Founders and Friends. It’s Kruze Consulting Founders and Friends with your host Scotty Orn.

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