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You Can’t Start Succession Planning Too Early

Avatar of a businessman holding up a signed agreement.

Last year, I shared the story of Elliott and Joe, two entrepreneurs who built an incredibly successful business together. However, they overlooked a crucial aspect of their partnership: a buy-sell agreement ​(read again here​).

Tragically, Elliott was diagnosed with fatal stomach cancer and passed away just four months later, leaving Joe in an unplanned partnership with Elliott’s heirs.

It wasn’t good. Joe reached out to me for help. That was three years ago.

Recently, Joe reached out to me with an update. Despite the challenges, Joe and Elliott’s family worked together to navigate the situation. Joe was forced to take out a fifteen-year mortgage to buy out Elliott’s family’s share in the business, and remarkably, he paid it off in just three years.

His heartfelt words, “Thank you!” underscored the importance of the advice he had received.

Looking back, what could Elliott and Joe have done differently? The answer lies in dedicating just 1% of their time to at least one annual conversation. This could have led to engaging professional help to craft a buy/sell agreement that would have benefited them both.

Like many entrepreneurs, Elliott and Joe were consumed with starting their business and taking care of customers, leaving succession planning as an afterthought. However, the 7-step Succession Planning Process is designed to facilitate the necessary conversations ahead of time to develop a plan that ensures your business survives beyond you and continues making a lasting impact.

The process begins with confronting your fears about succession planning and recognizing your business’s unique impact. From there, you develop the business as a mission, build a team to maximize that impact, and eventually exchange the baton to the next generation of leaders. By following these steps, you can multiply your business’s impact and finish well, leaving a legacy that endures.

Elliott and Joe’s story serves as a powerful reminder that succession planning is not a one-time event, but an ongoing conversation that should start from the very beginning. By investing time and effort into crafting a comprehensive succession plan, including a well-designed buy-sell agreement, entrepreneurs can protect their businesses, their partners, and their families from unexpected challenges and ensure that their hard work continues to make a difference for generations to come.

When it is that important, you can’t start too early! What outside voices might you engage to move toward finishing well?

Harry T. Jones

P.S. Our mastermind group #1 is sold out. We are building a waiting list for the next Cultivating Impact succession planning mastermind. We meet virtually as a group monthly and you have access to us privately. If you are interested in having me and eight others in your corner as you navigate leaving a legacy, reply to this email with “wait list” in the subject line and let me know.

P.P.S. Heads up: Succession Planning For Impact, the book is about to come out! Can’t wait to share it with you!

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