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A Good Owner Exit is About Much More Than Money

September 8, 2015 3 Min Read Transfer & Exit, Transition/Exit Planning
Mario O. Vicari, CPA Director, Family-Owned Businesses Group Co-Leader, ESOP Group Leader

A good owner exit is about much more than money

For entrepreneurial people, determining the strategy for transitioning out of their private company is often more difficult than building it. The process to prepare the business and deciding how to structure the transaction involve a great deal of complexity. Most third parties, especially M&A and private equity firms, think this process is one dimensional – it’s all about the money. While money certainly matters, we find that that in most cases the private company owner has a number of additional motives, including employees, community, family, and business legacy. 

When third parties don’t fully understand the multidimensional nature of this process, their advice and recommendations to the owner can become overly focused on the money aspect. This generally leads to low levels of satisfaction for the owner after the transition strategy is completed.

In his latest book Finish Big – How Great Entrepreneurs Exit Their Companies on Top, Inc. Magazine Editor–at-Large Bo Burlingham examines the elements of a good exit from the private company owner’s standpoint:

  1. They feel that they have been treated fairly during the process and appropriately compensated.
  2. They have a sense of accomplishment and can look back and know that they have contributed something of value to the world.
  3. They are at peace with what has happened to the other people who helped build the business, including their employees and family.
  4. They have discovered a new sense of purpose outside their business.

So while understanding the company and the transactional elements of a transfer are critical, we feel that the most important element is spending time with the owner to help them get very clear on what their motives and goals are, what matters to them, and how they envision life when they are no longer working in the business on a day-to-day basis. It is vitally important to engage in a process to think through these all of these elements and get very clear on them, which takes time.

The owners we work with almost always have different views of these issues, and there is no one-size-fits-all strategy. The power of Bo Burlingham’s list is not that it provides a prescription for what to do, but that it is okay for an owner to think broadly about all the dimensions of the transition process and to design a plan that will satisfy all of their needs.

Mario Vicari, Kreischer MillerMario O. Vicari is a director with Kreischer Miller and a specialist for the Center for Private Company Excellence. Contact him at Email.   


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Mario O. Vicari, CPA

Mario O. Vicari, CPA

Director, Family-Owned Businesses Group Co-Leader, ESOP Group Leader

Construction Specialist, Family-Owned Businesses Specialist, ESOPs Specialist, M&A/ Transaction Advisory Services Specialist, Transition/Exit Planning Specialist, Business Valuation Specialist, Owner Operated Private Companies Specialist, Private Equity-Backed Companies Specialist

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