Succession – Plan your endgame
In the busy day-to-day running of a business, especially start-ups and partnerships, the thought of a planned endgame rarely demands any priority and is often totally neglected until there is a real need for it.
Very often partial planning is the biggest issue. When a key partner experiences a catastrophic event, like an accident or severe health issues, a short-term plan is usually available, but the longer-term impact of the event is usually never considered.
There is no single successful endgame, and it may even change over time:
- In some businesses, a total sale is the best fit, especially when all partners have the desire to exit at the same time. In this situation, what is your plan to maximize the value of the enterprise? As partners what is your plan to ensure the business is “clean” and does not have private financial considerations? Should one partner fall away, what is the short and long term plan?
- In other businesses there may be a next generation to consider. How do they take over assets, without any major disruption?
Regardless of what the endgame is, it needs be defined and communicated to all stakeholders. My hope is that this piece, stops you to think about the ultimate outcome of a lifetime’s work and sweat equity, which you have/are putting into your business. Why not plan early and well for a WIN?
How often do you evaluate your succession strategy, to ensure it aligns well with YOUR planned endgame? We’d be happy to help.
Lourens Havenga
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