Succession Through Acquisition

Being Acquired Does Not Have to Mean Stepping Away

Owners have the choice of making continued investments into growing the business independently, and taking on the risk/reward element associated with that, or finding a partner that would provide the resources, skills and opportunities to grow more safely and efficiently. By entering into an acquisition agreement, owners can ensure security and peace of mind not only for themselves, but also for their family of employees.

An advantage of such an acquisition is that the acquiring company will have the priorities and programs in place to alleviate a lot of the work and worries that bog down business owners. Not having to worry about HR, IT, finance and compliance is a game-changer. With these important areas of the business in good hands, owners can focus on sales and marketing.

Owners can also gain access to best practices from an industry leader and new products that they don’t have access to as a smaller entity. Finally, management of the acquiring business can provide insight, support and guidance to leadership when needed.

Advice From the Field

When asked what they wished someone would have told them in relation to succession planning, three colleagues shared the following thoughts:

• Maggie Fleming, co-owner, president and chief executive officer, Neishloss & Fleming: “Consider all of the options you have when starting down the path of succession planning. Don’t close any doors unless they strongly conflict with your goals and values.”
• Tom Fleming, co-owner and chairman, Neishloss & Fleming: “Put as much time and energy into a succession plan as you would put into other elements of your business. You should always be working on your exit strategy along with everything else, because if you wait until you need that plan, your choices may be limited and your appeal may be diminished.”
• Lenny Anderson, founder of Minneapolis-based GoldenCare USA: “Understand that selling your business is not the equivalent of walking away. Selling can mean maximizing the value of your business and still work passionately at building it.”

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Bryan W. Adams is the co-founder and chief executive officer of Integrity Marketing Group, an independent distributor of life and health insurance products focused on the senior market.