https://youtu.be/xxcgOeSw3y4
Charles Read is a serial payroll entrepreneur and the CEO of GetPayroll. He is also the founder of Custom Payroll Associates and Payroll On A Budget and has over 40 years of experience in the industry. Charles is a US Tax Court Practitioner and a United States Marine Corps veteran.
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Fascinated by Payroll with Charles Read
Our guest is Charles Read, who is a serial payroll entrepreneur. He's the president of GetPayroll, a payroll and HR advisor firm serving companies with 10 to 1,000 employees. Previously, he was the founder of Custom Payroll Associates, a CPA payroll firm of which the CPA part, he spun out into a company called Cheyenne & Reed, and he kept the payroll. During this time, he also set another company called Payroll on a Budget, which was serving his customers. Prior, he started his career with Texas Instruments as a financial analyst. He's a Marine. He was in the U.S. Marine Corps, and he is a graduate of the University of North Texas, where he got his bachelor and MBA degrees. So welcome to the show, Charles.
Steve, it's a pleasure to be here. Thank you.
It's great to have you. So, Charles, tell me a little bit about you. You have an interesting background. It seems like you are well-reached on this payroll business, but you've done different iterations of it. So tell me a little bit about how did you start this business and how do you become a payroll entrepreneur?
I've been in business, I started working for my father in his business when I was six years old. So business has been what I've been all my life. When I was in school, I actually started a business making nose clips for my daughters who were synchronized swimmers and sold them to other synchronized swimmers around the country, around the world. So I've always been in business.
But when I got to about 40, I'd been working for major corporations and realized I was never going to run a major corporation. I didn't have the political skills. I was unwilling to stab people in the back and throw them off the ladder. So I figured if I was gonna run a business as my father had done, I'd have to do what he did and start my own. So being a CPA and an MBA with lots of experience, I started a business. I actually bought a franchise. The franchise went belly up a year later, and the wife and I just took it and ran with it.
That's been almost 30 years now. So, you know, being in business is how I was, you know, born into it and grew up in it. It just seemed natural to have your own business. So, for all those who have started one, you know, great. Bring your kids in. It's fun. Now, I never could work with my father. He was a rather authoritarian naval officer and we didn't get along all that well in business. But later on in life, we got along fine. But it's just what I was born to I guess and it's been a great run. I've enjoyed it immensely.
So you think that you bought the franchise and then the franchise ran out of business. So was your franchise company was the Custom Payroll Associates or CPAI?
It was actually Financial Express, which was a mobile accounting service. And the board, I was the COO at the time, I'd come from Pennies, and I was the COO, and the board was after the franchisor to sell off the original office and concentrate on selling franchises. So I bought that and took it over, and was having a lot of fun, and it had an integral payroll service bureau in the franchise.
Then when the company went, the franchisor went belly-up, we changed the name, incorporated, and just moved on and built the payroll. I enjoyed payroll, I enjoyed taxes, I enjoyed accounting. Later on we took on a partner and my wife retired. She passed away a few years ago, but we had 45 years of marriage, it was pretty good. So the partner wanted more autonomy himself, so I sold him the accounting portion, kept the payroll, and we've been growing it leaps and bounds ever since.
And he kept your name in the business because it's called Shane and Reed, right?
We'd incorporated it separate, and when I sold it to him, he kept the name. So I'm part of that one, too.
You have to make sure that he doesn't get into trouble and tarnish the name.
He still often is here in the same building with me, so I see him every day.
That's awesome. So what happened with the payroll on a budget? I'm particularly interested because it looks like it's right below where you position GetPayroll. So GetPayroll is 10 to 1,000 employees. Payroll on a budget is 1 to 10 employees. And I'm interested because I've done something similar with my M&A advisory business. I thought, wow, there's a big market below us, let's start a business brokerage firm. And that didn't go anywhere. And I just wasted my energy and my attention on it. And I had to just wind it up at some point and go back to the M&A, which made the money. So what was your experience with this company?
Well, we wanted to set up a budget operation for small businesses. And it was set up where it was very little contact, mostly online, no handholding, no lots of touchy feely. Well, over the years, the technology changed, everything was easier to handle electronically. And we found that they really needed more on hands than some of the bigger companies. So we weren't able to continue to do it for a lower price, so we just rolled it into our regular business, up the price to standard, and moved on. I think we lost one client when we did that.
Everybody pretty much understood that it was just something we couldn't afford to do at that price and still give them the hand holding they wanted. So it worked out for everybody, but it just, it's one of those things we wanted to try a low cost alternative and it just didn't work because they needed the hand holding and the personal service that's the hallmark of GetPayroll. So when we offered them that at a regular price, they all said, okay, except one guy who's, you know, wanted to nickel and dime everybody over everything, so be it.
No, it was exactly the same for us. We thought that we could provide the streamlined version of the service, but actually they needed more hand-holding because they were less sophisticated and it just didn't work.
Exactly the same experience.
Expectations were unrealistic there on both sides, I guess.
Yes.
Okay, that's interesting. So why payroll? What excites you about being in the payroll business? Some people might say, I mean, I started life as a CPA with KPMG, so I guess I have the right, I kind of pull your leg on this, but what, and you can ask me why I became a CPA, what excited me about it, but what excited you about being in the payroll business?
Well, the payroll business is fascinating. First of all, you're dealing with businesses, not consumers, which you're dealing with an audience that more understands business because they're in business, so they wouldn't have payroll. You're dealing with business. You're dealing with government. You're dealing with 15,000 taxing authorities around the country. There's a million things going on every day. Things change. It's constantly interesting. It's constantly changing.
The last year, of course, has been just crazy, as I expect the next few will be as well. So it's always interesting. There's always something new. There's always something exciting. There's new clients. There's new things. There's new taxes, there's new opportunities, the IRS makes mistakes, there's opportunities to advocate for my clients effectively. Fighting the IRS for clients, it's kind of like playing high stakes poker with somebody else's money. You get all the fun and none of the risk. Particularly when I was younger, I was very, very much one for the fight, being a Marine and everything else. So the chance to take on the IRS on a regular basis and win is just fun to me.
I bet it is. So how do you beat the IRS? How do you go about this? Obviously, you cannot tell me in five minutes, but in a nutshell.
Frankly, you know more than they do. You study more, you learn more. I'm a U.S. Tax Court practitioner as well, which means I can represent clients in tax court without being an attorney. But I had to pass basically the tax court bar evidence, ethics, procedures, and so on. So I'm very, very educated in payroll and payroll taxes and payroll tax compliance. I do this all the time. I study, I read, I take courses, I get education, I practice, I go to court. I do all these things constantly.
The IRS is lax budget, lax training, and it's not, for many people, it's not the most desirable job. So you get a class of people that may or may not be the very best possible people in the world. Now, most of them are nice people. Don't misunderstand me. I deal with them all the time and most of my life. There's the occasional one that's a real loser, but for the most part, they're good people. I mean, I go up to D.C. and meet with the IRS as part of the IRS Advisory Council.
I've met the new commissioner. I've had lunch with them a couple of times. I've met all the commissioners of the operating divisions and their deputies, lots of people. For the vast majority, good people. New head of OPR is a friend of mine. That part's fun, but I study and I read and I learn and I practice. Thirty years of doing this, I've gotten more experience and more education and more knowledge than most of the people that I deal with because they've been moved from area to area in the IRS and they haven't spent thirty years unemployment taxes.
I have and I'm going to court and i filed tax court petitions and I've litigated cases, I've learned i read the IRS manual, I read the procedure manuals, I read the IRS I read tax law, I read congressional bills. So I'm just more knowledgeable and more experienced. And that gives me the upper hand. A businessman trying to fight the IRS, the analogy I use is if you take the best Brazilian soccer player in the world, somebody like in my day and age, Pelé, who was an incredible athlete, okay,
