Jay Sachetti joined Jeff O’Brien, partner at Husch Blackwell and Dyanne Ross-Hanson, president of Exit Planning Strategies talked about the market for mergers and acquisitions, exit planning opportunities for companies that don’t end up for sale and how companies can maximize their eventual sale price during an early October panel at the first Upsize on Tap event at Summit Brewing Co. in St. Paul.
When the state Legislature passed a law requiring employers to provide paid leave and safe time for employees, Justin Bieganek started hearing differing details from friends, colleagues and peers.
My father died at age 67, before he retired. So 15 years ago when I started coaching business owners about retirement I began thinking about mine.
I’ve discovered another way to look at retirement: you can call it “successful planning,” a term especially attractive to us diehard entrepreneurs.
Many of the people I worked with grew up with parents who worked for a company and either retired or died in their 60s. Many entrepreneurs wanted to pass on the business to children or key employees but didn’t know how to do it, so they either figured they would live forever and did nothing, or sold it to someone else to avoid having to deal with the issue.
I decided because I was a coach/facilitator for Inner Circle, the local peer advisory group for business owners, I should plan my exit strategy. With my business owner clients, I preach vision and action plans and use them as a guide. I also ask everyone to think from the company’s standpoint as well as from the viewpoint of the entrepreneur.
For most business owners, there are two areas to look at closely: when does the company pass us by in what it needs from the leader; and can the sale of a business allow us to keep living our lifestyle.
Enough about what I preach. Here is what I am doing, in the hope that my process can serve as a guide to others contemplating their next stage. I approach this in four parts.
First, I am looking at what would work for a soloist to pass on or sell a business.
Second, I look at what type of person would succeed at running my business. (I changed this a few times because of real trial runs, realizing the person can succeed without being a clone of me.)
Third, I look at what my clients need from my replacement.
Fourth, I look at what my life would be like after Inner Circle.
I discovered that my original model was faulty. I thought the model was to hire and train someone I felt could start their own peer groups and then be available to take over mine. I looked for someone who wanted to try it out on a part-time basis. I found that this model didn’t work because there was a lack of commitment due to the part-time hours and the lack of income.
Next, I chose to seek a retired entrepreneur who flunked retirement and wanted to keep busy, mentor other entrepreneurs, and earn income. Outside factors such as family, lifestyles, and lack of desire and motivation caused them to fail.
I looked at members of my own Inner Circle groups who would help me when I was absent from a monthly meeting. I envisioned this would allow me to travel and spend more winter time out of Minnesota. This has a been a successful short-term solution.
My retirement plan in its current form has been helped by two outside factors. One was the fact that my Twin Cities Inner Circle was sold to a much larger franchise company. As part of the sale I needed to replace myself, so I am working with a former Inner Circle worker to add facilitating Inner Circles as part of his consulting business. I plan on adding two or three more facilitators to grow the circles.
One thing I must stress: you may make your own retirement plan but outside factors can influence its timing. Maintain flexibility!
Now back to the other half of the equation. What will I do with my time when I institute a successful exit plan? I don’t want to spend 12 months in Palm Springs and I can’t play golf seven days a week. I need to create an action plan for my future retirement life.
“Don’t simply retire from something. Have something to retire to,” is how one pundit puts it.
What do I want my life to look like 11/12/11, the target date for my exit, and after? What do I have to do to reach my vision? Those are big questions, and I’m still sorting out the answers. Along the way, I’ve come up with-
1. Think about the non-financial part of your retirement early, not months before you retire.
2. The obvious exit strategy isn’t always “right” or possible for you or the company.
3. Financial security is important, but equally important is your mind, which can become a wasted body part.
4. How will the company function without you? It can function very well, as much as we entrepreneurs hate to believe it, but only if you think this through in detail.
5. Don’t give up your planning skills. Retirement doesn’t just happen.
6. Open yourself up to new experiences, activities and the things you have been putting off.
7. Involve others around you in your plans. You need someone to ask the tough questions, especially someone who knows you well.
What’s your personal retirement outlook? I invite you to start thinking, and especially planning, now.
