The Kids Will Take it Over: Assumptions about Family Succession Planning
At the end of another 60-hour work week, you sit back in your desk chair and exhaustion falls on you like a lead vest. You’re so spent that just going out to a nice dinner with your spouse feels like a chore. It didn’t used to be like this. As a business owner, you’ve been pretty good at ignoring your mortality. But it seems to be catching up with you these days.
Your thoughts turn to succession. “Boy, I really need to figure out how I’m going to extract myself from this business. For decades, the business has been indistinguishable from me.”
Before getting too reflective, you push these thoughts aside and remind yourself of your unspoken exit plan: “The kids will take it over and they’ll deal with it.” After all, who would turn down the opportunity of a lifetime, to step into the enterprise that provided the charmed life you and your children have enjoyed? Why would they choose any other path, right?
While the answers to these questions may seem self-evident to you, your assumptions are worth exploring.
Your Children Aren’t You
While it’s true that they are your children, they are not you. They have their own personalities, interests, passions, and dreams. They are most likely wired differently from Mom and Dad. And even if a child shows interest in your business, this doesn’t mean they want to own it. Nor does it mean that they want the pressure of carrying on your legacy.
The sacrifice required to run a business is enormous. Your children have had front-row seats to these sacrifices. Be prepared for the reality that they’ll take a different path.
Your Children Didn’t Grow up Like You
Most business owners I meet grew up poor or middle class. Private schooling, country clubs, world travel, fancy cars, and boating were not part of their upbringings. They worked hard, long hours, and put their everything into making their dream a reality.
This may not be the case with your children.
Giving your kids the life you didn’t have isn’t a bad thing, in fact, it’s admirable, but it does make them differ from you in some key ways.
Even if you did your best to shelter them from your financial success, they were raised differently.
This difference in upbringing has exposed them to a side of life you didn’t know existed at their age. The universe for them is much larger and the menu of options much greater. Don’t be surprised if running your company is not their top life choice. Truth be told, this is exactly what you wanted for them, to dream bigger than you ever thought possible.
So Now What?
The next time this moment of clarity hits you, do not let that sentimental moment pass. When you start to think about “what’s next”, use that as motivation to do something. First, initiate dialogue with your kids and truly listen to them. Don’t make assumptions about what they think. Let them tell you what they think. And remember: they can love your business, love what it provided for them, and love you for creating it, but that doesn’t mean they were meant to run it.
If done right, this won’t be a one-and-done conversation. It’s one you’ll start years before you have to, and will check back in on regularly. We are always growing and changing, our kids even more so than our businesses. We’ve been socialized to continue to look for what’s next. Sometimes what’s next for them has nothing to do with us, and other times it’s all about how we pass the torch.
Either way, knowing your options is priceless. Sure, they may not want to run your business one day, but you still want them to benefit from it.
At Doescher Group, we work with business owners looking to exit well. In some cases, this means exploring and consummating a family transition. In other cases, it means something else. We help you navigate these stormy waters and come through the storm in one piece. Interested in learning more? Reach out to us today.
