Alessandro Chesser, CEO of Dynasty, on supercharging QSBS for founders & investors

We’ve covered the rise of tech-enabled wealth management apps starting in 2022 in our interviews with Ritik Malhotra, co-founder & CEO of Savvy Wealth ($72M Series B, Industry Ventures) and Jordan Gonen, CEO of Compound (merged with Alternativ Wealth in 2023).

To learn more about the QSBS (qualified small business stock) wedge into wealth management, we reached out to Alessandro Chesser, co-founder and CEO of Dynasty.

Key points from our conversation via Sacra AI:

Maybe start off by explaining what Dynasty is, what the initial product-market fit looks like, and who the core customer is.

Dynasty is a full-stack Nevada trust company. We create Nevada trusts, we serve as trustee, we file tax returns, we do the gift valuations, we do it all. But we have a very specific target market: we're only focused on startup founders and startup investors, helping them with their illiquid paper wealth.

We help startup founders and startup investors put their founder shares or their carried interest into Nevada trusts, then we do the gift valuation to determine how much the gift is worth, and then we serve as trustee. The whole reason for doing this is estate planning and tax benefits.

This all comes down to QSBS, qualified small business stock, which is the greatest tax exemption that exists. It allows startup shareholders and investors to sell $10 to $15 million worth of their shares and pay zero taxes at the federal level, and also at the state level depending on where they live and whether they have a trust or not.

QSBS stacking works like this: by default, as long as you're at a qualified startup and you get your shares early enough and hold them for three to five years, your shares qualify for that $10 or $15 million QSBS exemption.

What we do is help you create trusts to get more QSBS. You can create trusts for family members, your children, your spouse, your parents, your siblings. Every trust you create gets a brand-new QSBS exemption. Under the old $10 million exemption, if you create four trusts, you get an additional $40 million in tax-free capital gain eligibility.

What did the workflow look like for getting this done pre-Dynasty, all the players involved, and what does it look like post-Dynasty?

The specific investor I'm referring to had a very expensive family office advising him on setting up these trusts. That family office connected him with a South Dakota attorney who charged $25,000 per trust. He ended up creating three or four trusts, so that was $75,000 to $100,000 in fees just to create the trusts.

Then, because he was using a South Dakota trust, he needed a South Dakota trustee. That's what a licensed trust company does. South Dakota trust companies charge on average $8,000 to $10,000 per year per trust. So this individual paid around $8,000 times three or four trusts, another $32,000 to $40,000 per year just in trustee fees. When you add it all up, the total expenses are well into six figures, and it's ongoing. It's forever. Especially with these irrevocable trust arrangements. You can't take it back.

The reason people set up trusts in states like Nevada and South Dakota is that these states have the best laws for multigenerational trusts. They allow for what's called a dynasty trust, which can pass from generation to generation without ever settling, meaning heirs never have to pay estate taxes for hundreds of years. Our Nevada trusts can exist for 365 years, and that's huge because estate taxes are massive, 40%. Otherwise, if you set up a normal California trust, you pass away, your trust has to settle, and up to 40% of your assets above the $15 million estate tax exemption are subject to that estate tax. That's almost half your money.

For this investor, after paying six figures to set up the trusts and $32,000 to $40,000 per year in administration fees, plus about $30,000 to a traditional valuation firm to value the shares, when it was all said and done, the first year was a couple hundred thousand dollars in fees.

That's the market we're going after. We looked at that and said: why should you need to deal with all these separate parties, a lawyer, a licensed trust company, a separate valuation firm? We needed to create a one-stop shop for startup founders and startup investors. That's how Dynasty was formed.

As a founder, when do I come to Dynasty? Is it at incorporation? Is it before I've filed for QSBS? Further down the line? And what does the relationship look like from there through to an exit?

The earlier the better. When you set up a trust, you're gifting shares to the trust, and we have to do a gift valuation to determine how much that gift is worth. You have a $15 million lifetime gift exemption. You can only give $15 million in your lifetime without paying gift taxes. So you want to gift early, when the shares are worth next to nothing, because that preserves your $15 million exemption.

If you wait until Series A or Series B, you're going to be severely limited. If your shares are now worth $100 million on paper, you can only gift up to 15%, and you can never do it again. Everything after that is subject to 40% gift tax.

It was never possible for founders and investors to set up trusts at the very beginning, because who would pay a couple hundred thousand dollars when they're just starting out? Only successful repeat founders or investors who'd had multiple prior successes could afford it. We came in, automated the process, and brought the pricing down so that people can do this from day one, which is when it's most advantageous.

On fees: today we charge $1,500 per year for up to four trusts, effectively $375 per year per trust, plus a one-time fee for the gift valuation of either $1,500 or $3,000 depending on the stage of the company. All in, you're under $5,000 to get started, and then $1,500 per year going forward. That's dramatically cheaper than the six-figure alternative.

Our fees are structured to be affordable when everything is still paper wealth. But they do go up when you exit. When you make your money, we make our money. The reason is that the administration costs increase significantly. Once you have real cash in the trust and you're investing it into LLCs, buying real estate, investing in startups, the trust becomes far more complex to manage. We're the trustees, so we're doing that work. Fees go from $375 per year per trust to $3,000 per year per trust post-exit, an 8x increase. But at that point, you have millions of dollars in tax-free capital gains sitting in those trusts, so the trust can essentially pay for itself forever. And because these are dynasty trusts, they're multigenerational. They can pass to your children, and their children, without ever triggering estate or gift taxes.

Can you talk about acquiring the trust company license and why that's key to offering this at a lower cost than traditional services?

The trust company was one of the most complex parts of building Dynasty. We're not aware of many licensed trust companies that are also technology companies. All the existing trust companies are old-school, printers, filing cabinets, fax machines, and they charge a fortune. Many of them charge percentage-based fees, almost like AUM fees, even though they're not really advising on investments. They just charge a ton.

We saw that as the biggest business that needed to be disrupted. We also knew that if we were going to drive costs down, we had to be fully vertical. So we went through the painful process of becoming a licensed trust company. It cost a couple million dollars and took almost two years. It's an extremely complex process. But we knew that if we had to rely on a third-party trust company, fees would be too high and the experience wouldn't be simple enough for our customers.

We want day-one founders and day-one investors. Becoming a licensed trust company is what allows us to create that full-stack experience.

The investor example you mentioned also had a wealth manager advising him, and presumably legal counsel as well. How do you think about where Dynasty ends and where lawyers or other services come in?

We partner with a lot of estate planning and CPA firms. Whenever a customer has complex needs, tax advice or legal advice, we always refer them to partners: talk to a lawyer, talk to a CPA. We're not lawyers, we're not CPAs. There's a lot of precedent for this model. LegalZoom was the pioneer. They started doing direct-to-consumer trusts, went through all the early litigation, and that forced them into the same model: we're not a lawyer, but if you need one, here's one.

That's exactly what we do. We're not a lawyer, but here's a lawyer if you need one. We're not a tax advisor, but here's a tax advisor if you need one. We have off-the-shelf templates, and you can use them without talking to a lawyer or CPA. We'll explain how it works, we won't give tax or legal advice. If you have questions about the template, take it to an AI, ask questions, do your own research. Go DIY if you want. We don't mind. Our business is serving as trustee.

We give customers a starting point. If they want to customize, no problem. Our templates work well here because Nevada allows for a lot of flexibility, including the ability for the trust protector to amend the trust after it's created.

What typically happens is founders sign up, take the standard package, and then as they get closer to an exit, when real money will be in the trust, they bring in lawyers and CPAs to customize it. But the gift has already been made, so they've preserved their lifetime gift exemption and built all the infrastructure for their future family office.

What does the go-to-market look like? Is this founder-direct, through venture funds, or somewhere else?

It's all of the above. I was the original sales leader at Carta, helped take the company from zero to $300 million ARR, so it's the same network. Startup founders, angel investors, same ecosystem. We knew there was inherent virality here, and it's actually more viral than Carta because the network is more concentrated. When you sign on one founder, that company might have two or three co-founders who each become individual customers. It's not like Carta where you take one company and that's your one customer. You take one company and turn it into three, four, five customers.

Those individuals then introduce us to their friends who have companies, or to investors who run venture funds. We're currently opening the product to GPs. We have our first few GPs using it now and will be releasing it to the broader market next month. That creates a flywheel: more founders lead to more GPs hearing about us, more GPs using us leads to more founder referrals, and so on.

The most important thing is building the best product and the best experience. When a founder can set up their trust, transfer shares, and get a gift valuation in a matter of days at one-twentieth the cost of the traditional route, they're going to tell all their friends. That's product-led growth. We're not doing old-school email marketing and cold calls. Those channels are no longer effective. You can still invest a small amount there and treat it as brand marketing, but if you want real efficiency in go-to-market execution, nothing beats product-led growth and a truly viral customer base.

Do you think of Dynasty as the beginning of a relationship that could involve broader wealth services? It seems like Dynasty could be one of the first wealth-adjacent services a founder ever engages with.

That was the idea from the very beginning. If we create the trust, get all the assets in there, and serve as trustee, what can we do from that position? There are a lot of ways to monetize it.

It crystallized when our first customer sold some shares. We had to open a bank account, $60 million was wired in, and we were in control of that account. The customer turned to us and said, "What do we do with it?" And we thought, okay, here's the opportunity.

We've built partnerships, still in the early stages since the product is only eight months old, but we set up a relationship with Morgan Stanley right away. We knew those teams from Carta's partnership with Morgan Stanley. We created a referral arrangement where customers get a simple, automated account opening experience and choose from a few options: Morgan Stanley, Charles Schwab, Goldman Sachs. We have revenue-share arrangements with those institutions. We're not charging the customer more, we're just taking a piece of what the banks would have charged anyway.

Post-exit, in addition to the 8x fee increase, there are revenue-share opportunities across every transaction, real estate, loans, tax filing, investments. We decide where taxes get filed. We decide where loans come from. We decide where investments are held. We're the quarterback. It's a powerful position to be in, and that's definitely one of the underlying theses of this company.

Has the AI wave affected Dynasty's business, both on the customer-acquisition side and internally?

It's helping. More and more companies are forming, and I think that will continue. AI is going to cause large companies to contract, those employees will have fewer job options, and many of them will start companies, especially now that AI makes it easier than ever to do so. Before long, it'll be just you and an army of agents doing everything. We're going to see a lot more startups, more consolidation, more acquisitions, and that means a lot more wealth creation.

Internally, we've embedded AI into everything: trust creation, gift valuations, engineering. We're a 10-person company, and because we didn't hire a ton of employees early on, we were able to automate a significant portion of our operations. We can also pivot quickly as models change.

Most companies are still on AI v1, using ChatGPT or Claude Code as tools. We're on v2: creating agents that are doing actual work. The smallest companies are the most nimble, and that's exactly where we are. We constantly adjust as models improve. We're an AI-first company, not a company that uses AI tools, but one that's building agents to automate internal functions. That's allowed us to accelerate revenue growth to a level I haven't seen before with such a small team.

Zooming out on the competitive landscape, how do you map the market? I came across a few other startup-focused QSBS companies like Promissory and Valur. Where does Dynasty fit?

We are the only licensed trust company that is also a technology company and is exclusively focused on QSBS stacking. The companies you mentioned are the closest competitors we have. Neither of them is a licensed trust company. Only one of them is exclusively focused on QSBS stacking. Because they're not licensed trust companies, they have to use third-party trust companies, which is why their fees are significantly higher than ours.

If you want a one-stop shop, we're the only place to go right now. And on credibility, my entire team and I were founding employees at Carta. We know this ecosystem. One of those competitors you mentioned isn't only doing QSBS stacking. They're doing a whole range of strategies. We tried that approach. If you try to solve a lot of problems, you end up solving nothing, and you don't create obsessed customers. If you want obsessed customers, you have to focus on one customer type and one problem. That's what we've done with QSBS stacking.

Why QSBS stacking specifically? Why is that the one to focus on?

It was straightforward for us. It's the network where I have go-to-market expertise. We've built something close to a monopoly focused on that market previously, and Carta is a wonderful partner. We have every structural advantage there.

But beyond that, because of my years at Carta, I know how intensely banks want to reach these shareholders. Paper wealth is the fastest-growing segment in wealth management today. You're not going to find faster wealth creation than startups right now, not even close. We have an opportunity to get a concentrated base of customers, all with the same asset type, early, and a year later they might sell for $100 million or more. That kind of upside doesn't exist in any other segment.

Our backgrounds at Carta give us a natural advantage going after this market. But it also just happens to be potentially the most valuable customer segment we could target.

Recently there was a change. The exemption amount increased for shares incorporated after a certain point. Can you explain that?

July 4th, 2025 was the effective date for the Big Beautiful Bill. All shares issued before July 4th are subject to the old rules, and all shares issued on or after July 4th are subject to the new rules. Under the old rules, it was a $10 million exemption. You could sell $10 million worth of qualified stock and pay zero taxes. That's literally the greatest tax exemption that exists. Under the new rule, the exemption increased to $15 million. All shares issued after July 4th allow you to sell $15 million worth of stock and pay zero taxes.

You mentioned state taxes as well. Do you also not pay state tax, or is that state by state?

It's state by state. The two best examples are where most startup founders and employees live: California and New York.

California does not recognize QSBS. If you live in California, all shares held in your name will not be subject to QSBS at the state level. You'll save the federal tax but not the state tax. On a $10 million exemption, let's say you held your shares for five years, they qualify for QSBS, and the company exits. The federal tax liability that would have been about 23%, or $2.3 million, gets excluded. Instead, you only pay California's state tax, which runs around 13 to 14%, so roughly $1.4 million on that $10 million gain. It's still very good.

On the flip side, New York does recognize QSBS, which is remarkable, because New York also has very high state taxes. If you live in New York and you have QSBS-eligible shares, the first $10 million is 100% tax-free at both the state and federal level. It's the one situation where you see founders actually wanting to move to New York for tax purposes from California. There's no reason to do that otherwise because the taxes are just as high in New York, but when it comes to QSBS, New York has a clear advantage.

It sounds like Carta inspired a lot of what you're doing at Dynasty. Is there also an element of learning from where Carta fell short, particularly in owning the post-exit shareholder relationship?

I'll take a lot of the blame for what we weren't able to execute at Carta. I was in charge of sales for the public markets team, the CartaX team, and most of the businesses we were trying to make work, as well as the ones that did work: the cap table business, the valuation business, the tender offer business. We kept trying to figure out how to monetize the wealth creation moment.

We tried public markets. When founders go public and leave our platform, how do we keep them? We wanted to support them in public markets and become their brokerage. We didn't execute, and we shut that down. Same with CartaX, helping create liquidity in private markets and monetize that wealth creation moment. We didn't execute there either.

Carta is doing incredible things right now, by the way. This new focus on private credit has blown the company up. It's massively profitable and doing very well, and I'm proud to be a shareholder. But Carta kind of stepped away from figuring out how to create long-term relationships after the wealth creation moment, how to monetize that. We took that same mission and brought it to Dynasty.

What we learned is that serving as trustee is probably the single best way to create a truly long-term relationship after that wealth creation moment. When you have an irrevocable trust and a licensed trust company serving as trustee, that is an extremely sticky relationship. That wasn't the original intention. We were just trying to solve a problem, trying to figure out why this had to cost a couple hundred thousand dollars. But it turned into a solution to the very problem we were trying to solve at Carta. It came full circle.

What does the five-year outlook look like if everything goes the way you want?

Dynasty becomes the de facto solution for startup founders and startup investors, the first place they go. It becomes part of the incorporation process. The very first thing you do: you set up your corporation, you do your 83(b) election, you set up your trust with Dynasty.

One thing people don't realize is that everyone is so focused on dilution. Every time an investor comes in, dilution goes up, and it's hard to control after the fact. But you can pay $1,500 a year and increase the after-tax take-home for you and your family, which is effectively the same as reducing dilution. You're paying $1,500 a year to reduce the impact of dilution on your family's financial outcome.

Think of it like an option. You pay $1,500 a year. If things work out, you end up with millions of dollars in tax savings for you and your family. If it doesn't work out, you're out $1,500 a year for however long you did it. Small downside, massive potential upside.

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