Tax-Deferred Magic

Thanks for being here and taking a sip from the Fountain

This week’s newsletter is packed with stories, lessons, and a few opportunities we’ve opened up due to the amount of outreach we’ve been getting.

Here’s what’s inside this week:

⏳ Estimated Read Time: 7 minutes

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FOUNDER LESSONS

Patterns to Reality.

Let’s hit a quick review: Between stories of near death and life’s turning points, I’m sharing the true experience of starting and growing businesses. For SAXX, we’ve covered The Million Dollar Moment and Taking the Idea from your Brain to Paper.

Down the entrepreneur path we go. 

Now I had patterns and I learned the words “grading” and “scaling”. Next I had to figure out which fabric to use for the most important part - the Saxx Side Panels (now Comfort Pouch which is the mesh which holds the real jewels.

So I went to a store called La Senza and examined the finest female lingerie; some had pretty pink patterns, some had flowers on them, but I wasn’t distracted by that. I was feeling the the stretch, the “hand”, and how well you could see through for air to flow, and I bought a few pairs that had great mesh.

I took those panties and cut them up, taking the samples down to Chu Shing in the fashion district in Toronto. I went in and showed the nice man in the shop my pieces of mesh, explaining that I wanted the same material, but in black. A few days later, I got a call that he had it.

Entrepreneurship has lily pads, each one is the next step on the path. 

Next up was sourcing a waistband.

So just by asking for references and doing it step-by-step, lilypad-to-lilypad, I didn’t really stress myself out and I made a little progress every week. Negotiating for discounts and trying to figure out how much material I needed, learning about different weights of fabrics, knits, wovens, and the process of manufacturing - turned out I was in fashion school in real life.

I had enough student loan money for a production run of 200 pairs. The first 200 pairs I ordered from King Garment in Toronto and a few weeks later I was there picking up my boxes. My little baby was born, but many steps to go from here. I went to Staples and got my Avery labels and some bags and got to folding and printing labels on the 200 bags so I could make my first sale.

Source and Use of Funds

$20,000 - Student Loan RBC
$2,500 - Patent
$2,500 - Trademark
$1,500 - Designer (Patterns)
$4,000 - Fabric
$2,000- Waistband
$1,000 - Labels
$1,000 - CMT ($4.50/pair)
$300 - Fuel & Transportation
$200 - Bags & Labels
$5,000 Balance

Next Fountain I will share how I named the Brand, and how I came to the price for the first pairs. I will keep walking us all down memory lane while sharing the steps you could take or make analogous to your business.

I was 26 and down to $5,000 of borrowed money with the first pair in hand.

Death and Taxes:

Section 85 of the Income Tax Act of Canada provides a powerful tool for business owners: the ability to defer capital gains taxes when transferring assets to a corporation. This mechanism, known as a "rollover," allows for the reorganization of a business structure while minimizing the immediate tax burden. Understanding how Section 85 rollovers work and their potential benefits is crucial for any entrepreneur considering restructuring or expansion.  

At its core, a Section 85 rollover allows a taxpayer to transfer eligible property to a Canadian corporation in exchange for shares of that corporation, while deferring the recognition of any capital gains or recapture of depreciation that would normally be triggered by the disposition of the asset. Instead of realizing the gain immediately, it is effectively "rolled over" and deferred until the shares are eventually sold. This deferral can be a significant advantage, allowing business owners to reinvest funds that would otherwise be paid in taxes.  

Several types of property are eligible for a Section 85 rollover, including:

The mechanics of a Section 85 rollover involve a complex process of electing an agreed-upon transfer price for the asset. This elected amount is crucial, as it determines the amount of the capital gain deferred. The elected amount can fall anywhere between the adjusted cost base (ACB) of the property and its fair market value (FMV). Choosing the right elected amount is a critical decision, requiring careful consideration of various factors, including the taxpayer's current and future tax situation.  

The Benefits of a Section 85 Rollover:

The primary benefit of a Section 85 rollover is the deferral of capital gains taxes. This deferral provides several advantages:  

Important Considerations:

While Section 85 rollovers offer substantial benefits, they also involve complexities that require professional guidance. Key considerations include:  

In conclusion, Section 85 rollovers provide a valuable tax-planning tool for Canadian business owners. By allowing for the deferral of capital gains taxes, these rollovers can free up capital for reinvestment, improve financial flexibility, and facilitate corporate restructuring. However, the complexities involved necessitate careful planning and professional guidance to ensure optimal results and avoid potential pitfalls. Understanding the intricacies of Section 85 is a key component of sound financial management for any Canadian entrepreneur."

So until next time keep the monocles on the fine print and hopefully we are all learning more financial literacy together. 

How to get through hard times (as a mom & an entrepreneur)

The feeling of life being hard is relative. I’ve had no money and more than I could have dreamed. I’ve had trouble having kids then suddenly had two kids. I’ve had no work and too much work.

I was raised by a single mom who never gave up.

All situations hold their own versions of "hard", and here are four ways that I’ve found to build a steadfast mentality through each one:

1. Gratitude - it’s not "toxic positivity" to set some attention on the side of the coin that holds blessings. When we choose our focus, we steer our mental ship. This can be really useful to get through short spurts of "hard".

2. Set priorities - the number of, and standards for, all the hats we wear these days is mentally exhausting - if we give them all equal weight. I've been able to get through this overwhelm by choosing 2-3 things that I prioritize and then letting the rest go. So what if my house is messy right now? I'm the only one that cares. Choosing what matters most - and what doesn't - relinquishes the control that all the hats hold over our mental health. 

3. One thing at a time - The odd time that I go for a run, or whenever I'm doing something hard, I notice that I do better when I look down at my feet (or the next step) rather than focusing on the end goal. My mind naturally knows that I can handle one more step, one more rep, one small task, but becomes overwhelmed and self-defeated if I look at the end goal. 

4. Ask for help - being vulnerable connects us. People want to help, it brings them a sense of purpose and community and creates a deeper bond. And we all take our turn needing help. Now more than ever, don't be afraid to ask.

It's taken time for me to uncover these philosophies and they work for me  - you may get super motivated by focusing on the end goal rather than the next step but what's important is learning what approaches build resilience in you.

Over the past few months, we’ve had a lot of founders reach out asking for guidance—on scaling, hiring, and building a business that runs smoothly without constant firefighting (although there will always be that).

We’ve been through it ourselves. Growing a company is a different challenge than starting one, and the right decisions at this stage can make all the difference. After seeing how many people are looking for real, hands-on help, we’ve decided to open up a few spots to work directly with founders who are serious about taking their business to the next level.

This isn’t a course or a one-size-fits-all approach. It’s direct guidance based on what’s worked for us and the businesses we’ve helped. We’re keeping this small so we can focus on the few founders we know we can make the biggest impact with.

We’ll focus on:

If you’re at a point where you know your business has more potential but need a clearer path forward, we’d love to help.

We’re only opening a few spots to make sure we can do this right. If you’re interested reply to this email with the subject line (Consulting) and let’s chat.

Public Speaking has turned into a passion of mine. I’ve found success and am humbled to receive kind words from organizations like my Alma Mater Western University, Restor International, Founder Events, and Entrepreneurs’ Organization. We’ve also received a lot of questions my availability to do this so I thought I’d open it up to the Fountain.

I keep it simple: real stories, real lessons, and practical takeaways. No fluff, just the hard-earned jewels that have shaped my journey—from launching SAXX to scaling multiple brands and navigating exits.

For those looking to bring an engaging, no-nonsense perspective on entrepreneurship, leadership, and resilience to their audience, I’m opening up a few speaking slots this year.

Here’s what to expect:

If you’re interested in having me speak at your event, let’s chat. Reply to this email with subject line “Speaking” and I’ll send you some testimonials and a media kit so we can chat!

I’m humbled by the response to this newsletter thus far and excited for the journey ahead.