As an independent business owner who has put years of hard work into your successful enterprise, it is pretty important to take stock and have a good look at your Diversification Risk.
How much is your business worth and how much of your wealth is tied up in it?
In many cases owners are so focused on their business that they do not get an opportunity to step back and look at their over-all financial picture.
In some cases owners are not even sure what their business is worth.
From a planning perspective, this becomes difficult, because at some point you are going to need an idea of your net worth and exactly how you will strategically create an income stream for yourself (and your family) in your next stage of life: post ownership (we used to call it retirement!!)
"Succession planning is all about taking the helm and setting the course for your eventual exit from the business...Failure to plan, communicate, and manage succession is the greatest threat to the survival of a business" (Succession Planning Toolkit for Business Owners, Weigl et al).
Even if the next stage (of life) is years away, there may be a significant amount of risk in having most of your wealth tied up in one asset: your business.
In her book Money Magnet: How To Attract Investors To Your Business, Jacoline Loewen discusses some very interesting ideas for not only taking some of your hard-earned wealth out of your business, but also getting a capital injection at the same time so that you can continue to maximize its growth potential.
Diversification (to make your wealth manager happy) and the ability to continue to grow your business, sounds like getting your cake and eating it too!
How? Private Equity , or as Jacoline so eloquently puts it : "O.P.M. (other peoples money)".
"Money Magnet is a guide for entrepreneurs interested in accessing capital from the private equity market. It is addressed to entrepreneurs, in accessible language, by an author who has spent a career helping businesses grow.
Undoubtedly, owners and founders of businesses need capital, but too often a trip to the dentist seems more appealing than dealing with financing."
http://www.moneymagnetbook.ca/
Succession planning and Private Equity can work hand in hand to help business owners diversify and strategically plan their (and their families) future.
It only makes sense to click on the above link and delve a little further into this great option. Can I help? Contact me to explore the possibilities!
Subscribe to:
Post Comments (Atom)
1 comment:
Thank you for your kind words, Scott.
Many business owners are satisfied with their company but our clients are ecstatic with their company.
Post a Comment