Well here is a contrarian thought. For owners of private companies I recommend they stop separating out personal and business priorities and instead collide them into each other! Your business is your life. It probably accounts for well over 70% of your wealth. It’s your vehicle for personal happiness. So owners need to ask themselves what are they trying to achieve from the rest of their life whether they are 35 or 65?
By setting out those questions on personal objectives clearly you can then turn to the objectives you have for the business. The CEO of a division of GE, or Apple or Google rarely gets that chance but the owner of a private does. Its’s the key perk of the job!
Personally I find questions help to clarify the issues so to be helpful here are a list of questions to consider. You might need help figuring out the answers but at least you will be worrying about the right issues.
- Is it wise to keep the majority of your wealth in one single company?
- Are there any compelling personal events arising in the next 3 to 5 years that need to be aligned with an exit or partial cashing out?
- Do you want to buy out your non executive brother/sister/aunt?
- Does your personal tax situation affect the timing of an exit?
- Do you need some cash now to buy that Boston apartment?
- Do you want to see your new company strategy properly executed?
- Are you bored and longing to spend your time doing other things? e.g. investing in other businesses, mastering hobbies, educating entrepreneurs, travelling more for fun (of course these ideas may confirm to you that managing your business is exactly what you want to do).
- Are you keen to start a new company in a new sector.
- Are you bored being the CEO?
- Do you want to earn significantly higher bonuses or dividends?
- Do you feel you are working on the wrong stuff inside your business?
- Do staff understand what motivates you?
Answers to these questions will allow you to formulate both personal and corporate solutions that makes sense.
By reconciling these personal objectives with the corporate strategy on a regular basis you avoid huge disappointment and mutual mystification between shareholders, management and all employees.
This alignment will bring a new level of energy, a new velocity, passion and commitment that will engulf all stakeholders, driving them towards a common goal.