If you are like many business owners, you have about a 10-year timeline to sell and an estimated valuation. A 10-year timeline works until it’s 10 years later and you are burnt out, or checked out, and ready to sell. Then you realize that getting what you want is going to take longer than you expected.
Identifying a capable successor to assume your roles, or to buy your ownership, can take more than a few months. The steps to take to manage the succession process include ensuring your company doesn’t struggle through the transition. Talented people who enjoy working for you may need time to assimilate to a new leadership team. Your clients or lenders may need time to build trust and confidence in anyone who is not you. And, if your successor is lacking in any key skills, it’s important they have a chance to learn from you or your team before navigating significant responsibility changes. And if they have to secure a commercial loan, they need to be prepared to confidently convey their vision and demonstrate surety to the bank. This all takes time, and the more time your successor has to prepare, the more likely your transaction will be a success.
The right time to start preparing your succession plan or preparing for a company transaction is very much like any to-do list: the sooner you begin, the sooner you’ll be done. The good news is that The McFarland Group will draft, monitor, and navigate your plan as your exit consultant, business planning strategist, and personal readiness guide. We have all of the to-do lists ready, we have made this journey many times, and all of our clients achieve their personal goals. In our experience, the people involved in your transaction and exit plan need to know you are following a clear path to your goals, need to receive clear and manageable directions, and need to see that their efforts are meaningful and valuable to you and the company. Your company is made up of the people that understand your vision, understand what you want to accomplish, and are motivated to help you reach your goals. Preparing the company creates opportunities for your leadership team and talented key employees to realize their own goals. If you can confidently say what your people want, and how you can help them get there, then you can say your company is prepared for your exit planning goals.