In any succession plan, people are the number one consideration. This week, I spoke to a colleague who told me that they couldn’t sell their business internally because the adviser ‘didn’t have the money’. We often hear this, but the truth remains – often times the ideal purchaser for your business will be an internal staff member.
The funds to execute on a transaction are only one of the three metrics we believe are necessary for a succession plan to work. It’s timing, maths and people. People is by far the hardest element to orchestrate, and simply put without the right person a succession plan is almost guaranteed to fail.
If you have the right person, and some time on your side, it’s likely we can still design a succession plan that will work – timed tranches of equity, debt funding in the entity and creativity with vendor finance can often mean you earn materially the same overall sale price whilst maintaining your business legacy, and maximising your chance of clients remaining sticky with your existing business – not falling into a larger corporate model which may not suit their needs.
If you’d like to understand the options available to you for the future of your business, and succession, contact our office using the button below.
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