“Don’t worry,” said George, “Our accountant is taking care of all that,” referring to the transfer of his family’s business to the next generation, “It’s all in hand.”
Well, I hope it is. But there’s a lot more to transitioning the family business than accounting advice. If George’s accountant is accredited in family business advisory work, he’ll already be telling George that.
And I hope that George has consulted his family’s lawyer, and is getting the wills, trust deeds, shareholder agreements and the rest checked for robust completeness.
Even more, I hope that George and his family have taken several paces back and had a long honest look, together, at their:
- Values
- Family tensions
- Hopes and dreams
- Fears
- Plans
- Ability to carry out the transition.
Only then, with a full, agreed, written plan, are they in a position to say to their advisors, “Make it so!”
How hard is it to get this right? Here’s a clue, gleaned from masses of data. Take 100 first-generation family businesses, such as those founded in Australia by Boomers and post-war migrants. Of that 100, about 30 will become successful second-generation businesses, as a rule of thumb. Less than 1 in 3. Even with good lawyers and accountants.
And sadly, fumbled transitions can break families and destroy wealth.
So most of all, I hope that George and his family have been working with an accredited family business advisor, who can help them bring to the table their deepest feelings about the family and its business, who can help them navigate all the multi-disciplinary complexity, and who can help them formulate and carry out a comprehensive plan for the transition.
That’s our role at Upland. Give us a call today, let’s explore how this might work for your family.