Funding Innovation and Entrepreneurship

Tab 1

Summer 2012


San Diego-based businessman and philanthropist Irwin Zahn has always believed the combination of hard work and entrepreneurship is a great model for success. “It’s about developing and utilizing individual talent without a limit until you arrive beyond your destination,” Zahn says. “To achieve your goals and then share that success with others.”

 

It’s an ideology Zahn first embraced as a young entrepreneur in New York City, when he founded Autosplice in 1954. The company was originally called General Staple and began as a business that sold stapling machines. When a customer asked if the company could splice two electrical wires together, Zahn took a chance and tried to find a solution. The difficult task culminated with thecreation of a machine that uses an innovative, patented “splice band,” which wedges and crimpswires together for a complete and reliable connection. As a result, the company morphed into Autosplice, a worldwide manufacturer of interconnect terminals, component assembles and automated applicator systems considered vital for the electronic, automotive and telecommunication

industries. As the company grew, Autosplice expanded to San Diego, eventually relocating its headquarters.

 

“Young engineering students are creative people. I’d like for these young people to develop, on their own, new products and create new processes.” - Irwin Zahn

 

Last year, shortly before the sale of Autosplice in August, Zahn began talking to Marivi Shivers, a Wealth Management Advisor with The Private Client Reserve of U.S. Bank. At the time, Zahn was working with several other banks, but Shivers helped Zahn identify how he could potentially meet his unique philanthropic and estate planning goals.

“What I really needed was hands-on support that’s local,” Zahn says. “If I need something done financially, I want to pick up the phone and have somebody in person on a one-to-one basis.”

 

A Comprehensive Approach

 

In addition to helping Zahn with his personal and business accounts, Shivers worked with Zahn’s tax and legal advisors to implement various philanthropic strategies. The Private Client Reserve assisted Zahn with setting up and managing a donor-advised fund through the Jewish Community Foundation of San Diego which helps finance local projects such as libraries and parks. They also helped Zahn infuse his non-profit public benefit corporation, The Moxie Foundation, with assets from the sale of his company.

Tab 2

Summer 2012


Working with Zahn’s legal, tax and estate planning strategists, Shivers is helping him preserve and transfer wealth to his six children, nine grandchildren and two great-grandchildren. Zahn created a dynasty trust, also known as an Intentionally Defective Irrevocable Trust (IDIT), so future generations may access the funds should a catastrophic event, such as a fire or serious illness, occur. By setting loose parameters on what defines a catastrophic event, Zahn hopes to provide a safety net for his beneficiaries when they need it. Among the wealth transfer strategies executed were grantor retained annuity trusts (GRATs) funded by company stocks. “It’s a method of bringing money to family members by making them comfortable — but not so comfortable they stop working,” he says.

 

Fueling Innovation

When Zahn decided to sell his company, it also left him more time and resources to help other entrepreneurs.

 

“Now I’d like to encourage young engineering students to do the same,” says Zahn, with the help of The Moxie Foundation in San Diego, which funds innovative ideas in various capacities. It’s based on Zahn’s philosophy that if you give many creative people an opportunity, coupled with a little guidance, they can change the world.

 

To make that a reality, the Moxie Foundation has donated significant funds as an investment to San Diego State University’s College of Engineering to create an on-campus business incubator, The Zahn Center for Engineering Innovation. 

It is designed to help students grow their ideas into successful new companies — much like Zahn did.

 

“Young engineering students are creative people,” Zahn says. “I’d like for these young people to develop, on their own, new products and create new processes.”

 

The university setting is a great place to do just that, he says, with its ability to mentor young entrepreneurs and provide a dedicated space to develop new technologies.

 

But nothing fuels entrepreneurship like a financial incentive. So the Zahn Incubator Competition invites teams of students, faculty and alumni to compete for the best new business ideas for a technical product or service. Five teams are then selected as finalists to vie for a portion of the $25,000 Zahn Incubator Prize. Winners also receive a spot at the Zahn Center, which provides students, faculty, staff and alumni dedicated open space at the university.

 

As a result of the success at San Diego State University, Zahn plans to open two additional incubator centers at the University of California-San Diego and at his alma mater, City College of New York. “We want to make a difference,” Zahn says, adding that “U.S. Bank is accommodating in many different ways. I work with them because I am confident that they are handling it all well.”

 

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