Last Thursday at Insider Sources we spoke to Louis and Angie Barajas, co-owners of Business Management LAB, a boutique firm specializing in international celebrities in the entertainment industry. Joined by Managing Director Ashley Romero, the three discussed running a “multi family-style” office, managing Latin music clients, and promoting financial literacy in underserved communities.
Louis and Angie have been named one of Billboard’s top business managers since 2017, and Louis is the author of five books, and frequently speaks nationally on issues of financial literacy for Latino and underserved populations. He and Angie discussed how their background as firstborns of immigrant parents influenced a large part of their work ethic, as well as how they, along with Romero, emphasize the service side of the business management industry through their firm.
Why their background encouraged them to found Business Management LAB
Louis worked for a high profile accounting and consulting firm in Newport Beach, CA in 1990 when he made a decision on September 8 1990 after some life altering changes to go back to his community, East LA, to teach financial literacy to his community back home.
Since then, he has written over five books on financial advising and wealth management, particularly focused on providing access to consumer-friendly financial advice to lower-income immigrant families. It was the work he was doing in East Los Angeles that led him, and later Angie, to their first business management connection with the president of Sony Music Latin.
Business Management LAB is almost entirely family-run — “LAB” even stands for Louis and Angie Barajas, a name change inspired when Angie later joined on as a partner and an overall operations manager for the firm. Romero, who helps Angie manage a lot of the firm’s day-to-day operations, is the Barajas’ daughter-in-law, came from a service background. Rather than focusing solely on the technical aspects of accounting, Louis and Angie wanted the firm to be a place clients could turn to in times of financial and personal struggles, which is why they particularly emphasize the service side of the industry at their firm.
“Angie and I are the firstborn of immigrant parents. As firstborns, you are the translators, and you are the one who helps them fill out the applications, the mortgages, etc.” Louis said, “We essentially started doing business management since we were 13 years old for our parents. We realized that service was key for us: we had to blend people who had technical skills from accounting, but also had those service skills.”
Managing international clients
Business Management LAB handles Latin celebrity clients, with most of them working in the entertainment, music, and film industry. Clients have included Nicky Jam, Yandel, Mau & Ricky, and Ricardo Montaner.
According to Louis, only 3.8% of all certified financial planners are Hispanic and African American. Especially considering how often businesses prey on young talent, or prey on first-generation immigrants without many connections in the country, Louis and Angie Barajas are both involved in expanding diversity and inclusion within the financial planning industry.
“Most of our clients, they are big iconic stars that often come from poverty, and they’ve made it, but they don’t know how to take care of their money,” Louis said. “Some of the clients that come to us haven’t filed their taxes for several years and there’s a lot of clean-up that has to be done.”
Louis also states that a large portion of CPAs in the U.S. do not understand the intricacies of international tax law, especially with regards to international royalties. He recounts a number of CPAs he’s worked with who often filed their client under a Schedule E, as compared with a Schedule C. Location, immigration, and date of entry is especially important in international business management, as a clients location could determine if they should just be taxed domestically, or if their revenue now needs to be taxed on a worldwide basis.
Angie also points out that cultural understanding is a huge part of ensuring client success — most of the firm is Latino or bilingual. Especially with the conversations surrounding consolidation within the industry, Louis and Angie have resisted being acquired by larger firms because they feel that the quality of service would be compromised.
“We are very family-oriented,” Angie said. “And a family is about everyone recognizing their own unique role. We treat our clients like family and if we went with a bigger firm there is no way we would be able to do this, and I don’t think other people would understand our culture.”
Giving clients control through financial literacy
According to Louis, the firm often invests a third of a client’s revenue in a back-up savings fund, so none of them feel cornered into taking a bad deal.
The firm aims to set clients up for long-term success, so rather than investing based on hype or popularity, Louis structures financial investments in what he deems “structurally” fit for the client. Louis chooses to put their money into retirement plans, property, and private equity. Especially during the pandemic, Louis and Angie saw that many clients started to take their long-term financial goals much more seriously, many of them getting much more involved in the details of their bank statements.
Many companies capitalize on hype and trends — Louis finds that with popular investments such as NFTs and other cryptocurrencies, there aren’t enough core investments to make them good long-term financial decisions.
Louis is especially critical of Robinhood, saying that financial literacy is especially important when approaching similar companies.
“If you come from poverty and you are in Robinhood, what I’ve been seeing is that they are using it exactly how it is often used in areas of low income, meaning people will buy lottery tickets, gamble money, and try to make money really fast,” Louis said. “They are not learning how to invest, they want to play the roulette wheel. And that is the problem we are having right now — I still need to go out there and we need to teach the principles of investing.”