Updated: May 21, 2020
For many business owners who started the business from nothing, the dream of the business staying in the family fills them with a sense of pride, knowing that the following generations will take the business forward in perpetuity. The reality is very different.
For the busines founder, the dream makes absolute sense. A ready made business, be it a farm, a manufacturer or perhaps even a restaurant or construction firm. They have spend their lives building up the business, working 24/7, sacrificing family time, holidays and mealtimes, bedtimes to make sure that the business succeeded. Handing it on to a trusted family member can become an overarching desire that is spoken about on a regular basis, "When this is yours"!. "One Day this will all be yours".
If the recipient is compliant, then the transition can be rewarding for all, both the founder and the next generation.
The reality if often very different. The recipient does not want nor desire to run the business, nor perhaps do they feel they have the skills and talent to run the business. However the sense of duty can be overwhelming and can create huge stresses on the unlucky chosen one. They don't want to raise the fact that they do not want the business, so the relationship becomes strained as it is no longer and open and honest environment.
The strain on the family can totally split them into two camps. Those who refuse to take on the business and risk losing the relationship with the benefactor. Or those who take on the business unwillingly and sacrificing their own mental wellbeing for the priviledge.
There is a 3rd very dangerous option that echos through the annuls of time. The family memeber inherets the business and totaly neglects it, disinterested and aloof. They enjoy the benefits that the business gives and uses all its resources until they are diminished to such an extent that when it is time to hand over there is no business left.
For any business founder, they need to have an adult conversation with themselves about the reality of what they want to happen with the business and those around them.
There are 3 Core options:
Exit the business at some point in the mid term future
Run it as a lifestyle business and then sell up on retirement
At some point hand it on to the next generation
What is needed by all parties is open, non judgement dialogue. If this cannot happen it will have long term issues for the family, both within their relationships and mental wellbeing.
The mental welbeing should never be seen as a tertiay issue, it is paramount for all concerned and can lead to very real tragic outcomes for those involved.
I have talked often about stakeholders and my advise is not to talk to stakeholder in your business about this matters. You need an independent person to talk it through with and this is exactly what coaches and mentors are their for. To be your sounding board, you confident and importantly, a person that can be objective in asking difficult questions.