A comprehensive overview of the financing options available to small and start-up businesses.

In this business book, Sutton (Start Your Own Corporation, 2013) and Detweiler (The Ultimate Credit Handbook, 2003) present the financing methods available to people looking to start a small business or to provide additional funding to an existing one. The book addresses simple funding sources, such as personal savings and bank loans, as well as more complex investment vehicles such as crowdfunding and venture capital. Both aspiring and veteran business owners will find the book useful, as it details the ways companies can raise finances and operating credit at different points in the business life cycle. Sutton and Detweiler display a deep knowledge of government regulations, including recent changes to credit card and securities law, as well as the industry norms that determine funders’ expectations. They also provide readers with details on standard information that bankers or angel investors are likely to want, along with recommendations for organizing and presenting it. Appendices provide templates for standard documents, such as the private placement memorandum, and a section of further resources guides readers to other useful tools. The book also addresses common scams and predatory lending practices and cautions readers about their risks. The prose is occasionally awkward (“While not specifically agreed to but arising solely out of the situation, Nora spoke very highly of Chad and Ruth as the successors of her late husband’s devotion to customer service”), but Sutton and Detweiler do an excellent job of using legal and technical terms clearly, with a minimum of jargon. Although the book does urge readers to consult Sutton’s earlier books too often, the information on the whole is solid, and readers can feel confident in discovering solid advice.

An energetic, informative handbook for business owners.

A concise but thorough introduction to strategically protecting personal assets from corporate liability.

According to attorney Sutton, even a business organization that’s incorporated for limited liability protections can be vulnerable to litigation that attacks its owners’ assets. This is called “piercing the corporate veil,” he says, noting that it’s a strategy that meets with success approximately 50% of the time. Furthermore, he asserts, smaller corporations—and especially single-member and small LLCs—are particularly vulnerable, as they’re not typically covered by various versions of blanket protection: “Your business has a bull’s-eye on it. As we’ve learned, that bull’s-eye never goes away. It remains on every business and asset holding entity as a target for anyone suing to hit and perforate into your personal asset column.” The author explains the core of a defensive posture that observes all the necessary “corporate formalities,” or business requirements, in order to survive in a litigious society. In order to demonstrate the fundamental aspects of that plan, he furnishes an impressively comprehensive tour of the relevant legal landscape, including the nature of the aforementioned formalities, the various kinds of protective entities, and the ways in which corporate veils can be pierced. He even provides a consideration of “reverse piercing,” in which a creditor seeks to satisfy the debt of a private individual by suing a corporation that the individual owns. Finally, the book supplies a series of brief synopses of the relevant legal landscapes in other countries, including the United Kingdom, Germany, France, and Japan.

Sutton’s meticulousness is impressive; despite the brevity of this book, he covers a dizzying expanse of juridical territory. His expertise is inarguable; he’s also the personal asset protection attorney for noted business-book author Robert Kiyosaki, who contributes a foreword. (The book is part of the Rich Dad Advisor series.) The author’s counsel will be particularly important for those who are associated with smaller companies, which are both more vulnerable legally and more inclined to ignore practices that protect them: “it can be tempting to dispense with the formalities, failing to designat[e] officers (or managers) and a board of directors, have regular meetings, or keep written records….But without the formalities, it’s hard to prove that you’re operating the way a corporation should and thus would be entitled to its benefits.” And although the topic is somewhat less than seductive, Sutton admirably attempts—mostly with success—to give his discussions a lighthearted touch. He draws examples from popular culture (Superman, the Wizard of Oz) as well as history; for example, he cheekily interprets the American Revolution as a case of the Colonies piercing the veil of King George III. Much more importantly, the author conveys a technically formidable subject in prose that’s always clear and accessible and mostly shorn of legalistic jargon. Moreover, Sutton analyzes more than a dozen real cases, offering concrete illustrations of legal principles that might otherwise seem abstract to the uninitiated. Overall, it’s a rigorous and wonderfully synoptic introduction to a prohibitive but important topic.

A systematically organized and expert legal primer.

An attorney offers an all-encompassing exposé of financial scams.

This Rich Dad Advisor book departs from the primary focus of the series—business and investment advice. Instead, Sutton, a practicing attorney and the author of numerous other Rich Dad titles, focuses his attention on financial fraud schemes and how to prevent them. According to Sutton, “over 3.2 million Americans report incidents of fraud each year, and that’s only the people who actually said anything—a great many don’t.” Most chapters offer case studies of a particular type of scam followed by the author’s observations. Each study is engaging and often disturbing; clearly, it was Sutton’s intent to raise concern, if not fear, among his readers about the many ways in which people can be deceived. Some scammers, such as Charles Ponzi, whose name lives on in the term Ponzi scheme, and Bernard Madoff, who was convicted of perpetrating one such scheme that raked in billions of dollars, will be familiar to many readers while others are more obscure. However, these people are less important than the nature of their deceptions, about which Sutton goes into impressive detail. Particularly notable is the sheer breadth of his content; his examples include in-person, telephone-based, and online scams and address such crimes as identity theft (which affects more than 17 million victims annually, according to Sutton); phony sweepstakes; email solicitations; “vanity scams,” such as ineffective weight-loss products; and fraudulent real estate investments, among others.

Sutton cautions that anyone, regardless of age or class, is susceptible to con games, but he notes that “Seniors age seventy and up lose more money, by far, to scam artists and fraudsters than any other generation.” Indeed, some of the more heartbreaking cases here involve the elderly. One such example tells the story of an 85-year-old woman who was bilked by phone into believing that she’d won a Publishers Clearing House sweepstakes in 2018. She lost close to $28,000 to the con artist for “taxes and fees” before the hoax was discovered by the victim’s daughter. Some readers may find these dramatic accounts of personal tragedies to be quite unsettling; for the most part, though, the case studies are instructive and cautionary in tone, showing exactly how several deceptions work in the real world. What’s more, Sutton provides both general and specific guidance on how to identify and protect oneself against such scams. For example, his “profile of your typical scammer” is an insightful list of 11 richly described attributes, such as “They like to tell you how the clock is ticking”; that list is followed by 13 equally insightful “things that make for a good mark,” which may give pause to any reader. The closing chapter’s excellent suggestions for developing “scam radar” supply a comprehensive checklist that’s as solid a resource as one could possibly find. Overall, Sutton’s prose is informative, easy to read, and authoritative without being stodgy. His detailed descriptions and expert advice will be valuable assets to consumers and business owners alike.

Timely, relevant counsel on how to avoid con artists.

Corporate attorney and prolific author Sutton (Finance Your Own Business, 2016, etc.) discusses how to identify, sidestep, and untangle oneself from problem customers in his latest entrepreneurism manual.

The customer isn’t always right, says Sutton; in fact, he says, he or she might be a freeloader, a “feegoader” who “will use every angle to goad, or pressure you to reduce your fee,” or even mentally ill. Such “toxic” folks are everywhere, he says, and they particularly prey on business newcomers who are unwilling to turn away customers—but should. After that warning, Sutton goes on to shares his own stories (as a young lawyer, he had to defend a client who never paid his bills) and case study examples of difficult or downright disastrous customer relationships. He then offers tips on how to spot and evade bad apple clients, such as listening for clues and trusting one’s instincts on first meetings, and performing due diligence, including credit checks. He provides tactics for shaking off those who seem like trouble, such as by having clear, upfront policies on details such as retainers and return fees; by claiming an “imaginary partner” that one must consult before entering into agreements; or by saying that one is bound to a non-compete clause. The author concludes with three appendices that detail key avenues of recourse when one does get ensnared, including liens, small claims court, and collection agencies. Sutton’s book is an engrossing venting session with anecdotes that will be entertaining and relatable, especially to anyone who’s ever worked in restaurants or construction. They reinforce the idea that one shouldn’t be too nice—and, in fact, one should be wary—when dealing with people in one’s business. He also cites an array of sobering statistics to support this view, including that nearly 20 percent of American adults have a mental disorder, and that it can cost $50,000 to recoup $10,000 in unpaid fees. The book only skims the surface of legal advice that one might need for actual lawsuits, but it still offers a good kick-start to safeguard oneself against such prospects. 

An engaging, empowering business protection guide.

A concise but comprehensive overview of legal strategies to manage a business and protect one’s assets.

There are several legal entities that one may use to conduct a business, including corporations, general partnerships, limited partnerships, and limited liability companies. Attorney Sutton (Loopholes of Real Estate, 2013, etc.) takes each legal structure in turn and explains its essential advantages and disadvantages. Each is designed in different ways to control the management of one’s business, shield oneself from legal and financial liability, and capitalize on opportunities to lower one’s tax burden. This introductory volume is notably thorough, including a separate chapter on intellectual property—essential for “any halfway sophisticated purchaser of a business”—and extended discussions of bankruptcy, estate planning, and divorce. Sutton also provides a lengthy treatment of fundraising and the pertinent laws that govern securities. During a discussion of due diligence, the author even furnishes a template for keeping the minutes of a meeting. A spirit of relentless preparation in a dangerous, unpredictable world infuses the entire book: “As every reader knows, there are predators in our society poised to attack for the slightest real or imagined infraction,” Sutton notes. The subject matter is often vertiginously complex and full of hypertechnical legalese, but the author lucidly explains it all. He approaches the material like a teacher, using simple hypothetical scenarios to illustrate nuanced points; he also includes lists of frequently asked questions and their answers. No amateur could possibly master all the relevant details here, so the book is best understood as a primer that will allow readers to competently hire a legal expert. This isn’t breezy reading, and its comprehension demands focused study. However, it’s hard to imagine a more rational exposition, and it should prove useful to those who need to understand the difference between sound and unsound guidance.

A painstakingly meticulous introduction to a labyrinthine sector of business law.

Investing in real estate is as easy as understanding the tax code and personal-injury law, according to this informative but daunting primer, part of the Rich Dad Advisors series.

Sutton (Run Your Own Corporation, 2012, etc.), an attorney, expert in business law and one of real estate–investment guru Robert T. Kiyosaki’s stable of Rich Dad Advisors, offers clever, if complicated, new ploys to grow and safeguard a fortune. He begins with a motivational sketch of the cash-flow investment doctrine popularized in Kiyosaki’s Rich Dad Poor Dad—buy rental properties with borrowed money; rake in cash from tenants; leverage the equity to buy new properties; repeat until rich—but focuses on the labyrinthine “loopholes” that make the formula tenable. The first kind involves subtle tax dodges that add greatly to the profitability of property investments—everything from “cost segregation” depreciation to “passive loss” allowances to the “1031 exchange.” The flip side of amassing real estate wealth, the author continues, is protecting it against lawsuits, especially those filed by tenants. Sutton therefore explores another suite of legal loopholes for sheltering assets from court judgments, including insurance, limited liability corporations that distance owners from their wealth, and the tactic of loading properties with debt so they are less tempting targets for plaintiffs. There is plenty of arcane tax, legal and corporate-structuring lore here, but Sutton explains it in admirably lucid, straightforward prose supplemented with entertaining fictional case studies, including a picaresque involving an alpaca ranch, a moonshine still and whiplash payouts. Readers will learn a lot from the book, though not quite enough to master the subject; Sutton stresses that a team of expert “advisors”—a lawyer, broker, accountant, insurer, property manager—is indispensable for guiding investors profitably through the legal/financial minefield. The book cuts against the grain of Kiyosaki’s cash-flow populism, his credo that real estate investment, not earned income, is the little guy’s road to riches. Here, the investor is the almost vestigial figurehead for the army of business-service professionals who do the legwork. Still, novice investors will find it an excellent road map for getting started.

Readers looking for easy money may be discouraged by Sutton’s demonstration of just how complex real estate money can be, but others will find helpful guidelines, tips and tricks presented in a clear, engaging style.

Accomplished attorney and author Sutton (Start Your Own Corporation, 2012, etc.) presents a second volume on how to build a well-protected business from the ground up.

If it seems like Sutton is leading a tour through every entrepreneur’s worst nightmare, it’s because the path to running a successful corporation is rife with pitfalls. Founder of Sutton Law Center and a Rich Dad’s Advisor series contributor, Sutton knows what can happen when entrepreneurs ignore proper bookkeeping and other corporate formalities. Hefty tax liabilities, expensive lawsuits and criminal investigations can doom a business. Rather than cower from the dangers, Sutton digs in with an us-versus-them attitude and explains how to build a “corporate veil” that will be difficult for outsiders to penetrate, whether they be sue-happy clients or overzealous creditors. Stuffed with legal concepts but remarkably easy to follow, the book traces the evolution of three fictitious businesses over a five-year period—an engineering firm, a beauty salon and a housesitting venture. These “case studies” illustrate the basics of personal asset protection and legal documentation. Topics include choosing a corporate entity, payroll taxes, annual filings, IRS audits and more. Options are laid out with brutal candor because the consequences can be grave. One imaginary entrepreneur loses $15,000 due to trademark infringement, and another is sentenced to prison following a dubious tax investigation. The narratives can be a bit over-the-top, but it’s forgivable because a skilled attorney will anticipate worst-case scenarios. Sutton casts a wide defensive net, even highlighting the risks posed by social media websites. Government agencies like the IRS and OSHA are viewed with suspicion, and entrepreneurs are urged to rise above bureaucracy by following the rules. Sutton makes no apologies for the tactics used by the wealthy; while he insists readers pay their taxes, he shows ways to legally reduce their liabilities. The timeline of the book is ambitious, since many startups are barely profitable after five years, but Sutton’s strategies can be applied regardless of scope.

Part survival guide, part cautionary tale, a volume in which every aspiring entrepreneur should invest.

In this guide, Sutton (Run Your Own Corporation, 2012, etc.) offers recommendations for avoiding and solving debt problems.

The author begins by asserting that “the credit industry actively entices all comers, especially the young and inexperienced.” In the first part of this book, he goes on to offer some overall guidelines for dealing with consumer debt. In Chapter 4, he explains a 10-step strategy, along with sample worksheets, used by one couple who “never seemed to make a dent” in the amount they owed. The author makes recommendations about debt consolidation and includes a lengthy chapter, “Getting Help,” that thoroughly explains the different kinds of bankruptcy and the process of borrowing against a 401(k). The second part of the book looks at specific kinds of debt, ranging from current mortgage troubles to tax debt. A section on student loans, for example, includes eight remedies for dealing with overwhelming loan payments. Sutton’s chapter on debt collectors asserts that negotiating with collection agencies is “one of the most important skills you can learn and hone.” The handbook’s third part deals primarily with credit reporting agencies, credit reports and how they’re compiled, and credit repair. Throughout, the author presents stories of real-life predicaments that enliven what might have otherwise been bone-dry material. For example, “Credit Reports” describes the yearslong misery of a failed entrepreneur: “Roberto...had taken some risks on a restaurant that didn’t work out.” Finally, a chapter on credit scams and good uses of credit is followed by three appendices, including a list of other helpful books and websites.

A fact-packed, easy-to-navigate resource for consumers concerned about debt.

Sutton (Start Your Own Corporation, 2012) provides a handbook for entrepreneurs on the secrets behind successful business plans.

Businesses often start with a flash of inspiration for a product or service. According to the author, the difference between a good idea and a prosperous business is a well-written business plan. At its most basic level, a business plan helps organize an entrepreneur’s thoughts, Sutton writes; at its highest level, it provides a tightly structured outline of what the business will accomplish, how it will be funded and its requirements for long-term success. Sutton’s provides advice on how to establish a vision for what the business will do, how to gauge the potential company’s competition and how to find funding. “Ideally, a business plan is the intersection of everything inside the business (costs, products, services, personnel, etc.) and everything outside the business (competition, market trends, political forces, etc.).” The book provides several examples of how structured plans have helped individuals understand their opportunities and challenges and, as an example, also supplies a detailed plan of a potential restaurant. The author writes with authority, giving concrete reasons behind each section of a plan, but offers plenty of encouragement along the way, motivating readers to undertake what is essentially a soul-searching exercise as well as a financial one. Sutton is also objective and truthful when highlighting the pitfalls that entrepreneurs may encounter. He reminds business owners that once a business is up and running, it’s essential to consult the original business plan from time to time to ensure they are achieving their original goals.

A wide-ranging, detailed primer for potential entrepreneurs.