Ownership and Management Transition Planning or Mere Hope?

Recently, an attorney and financial planner called me to talk about a client who was discussing his ownership, management succession plans, and the life insurance associated with his “planning.” During our two-hour discussion, I learned about the client’s situation and was able to offer potential modifications to his current transition plan.

10 Ideas for Attorneys to Help Unlock Their Clients’ Private Company Wealth

I was in Boston to speak at the 2016 Spring Symposia for the American Bar Association Section of Real Property, Trust and Estate Law where I had the pleasure as a non-lawyer to share a session with Edward F. Koren, JD, leader of the Private Wealth Services Group of Holland & Knight. Our session title was “Unlocking Private Company Wealth: Give me Liberty (and Plenty of Cash)”. The session was based on my book, Unlocking Private Company Wealth, and our joint experiences over many years. This post provides some of the concepts we shared in the presentation.

Volkswagen’s Emission Scandal is Expensive and Tragic

The moral compass at Volkswagen was evidently not set to true north. The easy way or the cheapest solution in the short run may well be the most difficult way and the most expensive in the long run. Let the example at Volkswagen be a call for all of us to reexamine our moral compasses, both as individuals and as those compasses get translated within our companies. Some of the best decisions are made when we simply say no to the easy road.

Is Your Business Ready for Sale?

First in a Series on This Important Question

“Is Your Business Ready for Sale?” is one of the most pressing question facing business owners today. And the question is important for advisers to businesses, since we are instrumental in asking hard questions and, indeed, have the responsibility for asking hard questions of our private company clients. At the outset of a new series of posts, let me say categorically, I am not, not, not suggesting that your business should be up for sale. Bear with me while we focus on the actual question of “Is Your Business Ready for Sale?”

La Quinta Loses Value with Management and Outlook Changes

Shares of La Quinta Holdings (LQ) dropped sharply upon the surprise announcement on Thursday, September 17th, after the close of trading, of the the resignation of its CEO, Wayne Goldberg. The stated reason for the resignation was “mutual agreement.” Mr. Goldberg had been CEO at La Quinta for about 15 years.

In a second announcement the same afternoon, La Quinta provided modestly lower guidance (than previous) for RevPAR (revenue per available room) and for full year adjusted EBITDA. RevPAR guidance was lowered about 1.0% from an expected increase of 4.5% to 5.5% to the range of 3.5% to 4.5%.

The reaction in the share pricing of La Quinta on Thursday was immediate and severe. After closing at $18.97 per share Wednesday afternoon, the opening price Thursday morning was $15.93 per share, or some 16% lower than the day before. Based on about 131 million shares outstanding, the drop amounted to about $400 million in lost market capitalization.

So Many Questions a Business Owner Must Ask re Ownership and Management Transitions

So many questions that a business owner must ask. And answer, if he or she hopes to have successful management and ownership transitions and a successful business end game that prepares him or her for the rest of life. Many of the questions are interrelated and the answers to some will influence the answers to others. I pose the following questions as a starting point for discussion between owners, their families, their key employees, and their advisers. At the conclusion of the questions, I suggest that you can begin to work on answers by examining your buy-sell agreement. That process will get you in the mode of asking and answering critical questions during the interim time between now and your business end game that will insure that you transition ownership and management smoothly and prepare for the rest of your life.

Where Do You Want the Ownership of Your Company to be in 3, 5 or 10 Years?

Part Two

This is the second in a two-part series: Where Do You Want the Ownership of Your Company to be in 3, 5, or 10 Years? In this first post, we introduced the Ownership Transfer Matrix. In the this concluding post, we dive deeper into the ownership question.

Where Do You Want the Ownership of Your Company to be in 3, 5 or 10 Years?

Part One

This is the first in a two-part series: Where Do You Want the Ownership of Your Company to be in 3, 5, or 10 Years? In this first post, we introduce the Ownership Transfer Matrix. In the concluding post, we dive deeper into the ownership question.