by Dave Driscoll
The emotions surrounding selling your business are certainly strong regardless of age, but the economic and social climate in which you grew up impacts how you approach planning for that inevitable event. Considering these generational influences can help to provide a more objective perspective toward your business…and your Life After Business.™
Millennials/Generation Y: Business Owners Between 25 and 39 Years Old
The youngest owners seem to have figured out the simple truth that no matter how much you love your business, it can’t love you back. Typically, members of Generation Y prize entrepreneurship and the associated flexibility. The emphasis is on working smarter - using (and inventing) technology and collaborating with others to accomplish goals. This technology generation grew up learning new, better ways of doing things quickly, and they are typically unafraid of change. Millennials often engage their passions to further causes while earning money. Serial entrepreneurs live this emphasis as they begin or acquire multiple companies throughout their careers as their skills, interests and needs (personal and societal) evolve. Solid investing and financial planning from a young age will prepare this group for eventual retirement.
Generation X: Business Owners
Between 40 and 58 Years Old
Generation X business owners fall somewhere in the middle of the spectrum. They crave a healthy work-life balance but may also have a higher debt load than other generations, necessitating a financial focus that sometimes conflicts with a desire for more leisure time. Members of Generation X are generally considered direct and open to feedback, teamwork and building relationships. This generation began careers before widespread use of the internet and has simultaneously embraced technology tools and the importance of people skills. As they age, this generation of business owners may use technology to spend more time physically away from the office--delegating responsibilities to peers while still being available as needed for big decisions and crises. A crucial part of exit planning for this generation involves grooming a second-in-command and leadership team to build business value and reduce owner dependence.
Baby Boomers: Business Owners 59 and Older
For Baby Boomers, the expectations were long-term loyalty between employees and companies, the notion of “climbing the corporate ladder,” and a pension to reward that longevity. Changing careers or employers was met with suspicion. More so than other generations, Baby Boomers view their businesses as an integral part of the community and, by extension, see themselves as community leaders. To many Boomers, the thought of selling their companies feels like selling out their employees and disappointing their communities. In addition, workaholics were created by this generation, with self-image strongly tied to career success. As a result, many Baby Boomers feel conflicted when considering giving up their leadership roles. While they realize deep down that they need to sell their businesses to fund their retirements, they agonize over how doing so will impact their employees, their status in the community, and their family lives.
Older business owners grew up in a time when hobbies were impractical or discouraged. You went to work while your wife tended the kids, you ate dinner, you watched the evening news, and you went to bed. (Today more than half of all businesses are started by women, but those were different times.) With few hobbies and nothing other than work to define them, business owners in their late sixties, seventies and eighties feel lost without their businesses, which is why so many procrastinate rather than selling. Unfortunately, too many owners hold onto their businesses too long. The changing market and dwindling enthusiasm often destroy business value and jeopardize personal wealth.
All owners need to maintain a healthy emotional separation between their identities and their businesses. Creating and revising realistic exit plans throughout your business and life cycles are essential to maintaining balance and achieving the Life Beyond Business™ you deserve.
Dave Driscoll is president of Metro Business Advisors, a business brokerage, valuation and exit planning firm helping owners of companies with revenue up to $20 million sell their most valuable asset. Reach Dave at DDriscoll@MetroBusinessAdvisors.com or 314-303-5600. For more information, visit www.MetroBusinessAdvisors.com.