Preparing to Exit
Jul 16, 2007
Everyone who starts a company or ends up as its leader eventually starts thinking about how to get out. You may have the greatest job in the world, but life is short and most of us at some point can see the writing on the wall when it’s time to move on (or start planning for it).
That said, there’s often no one you can turn in your notice to. You are the supreme commander. Many times, firm leaders don’t feel comfortable that their seconds-in-command will be able to carry the torch and keep the flame going. If this sounds like you, STOP reading. You need to instead take action and find someone else, either inside or outside your organization, that you DO have confidence in. This is number one on your critical path to exit. There is no time to fool around any longer!
You also need to think about processes in place to run your firm. Rarely can one exit, especially when there’s an internal transition underway, and get all of his or her cash out of one’s ownership stake in the firm. That means you will have to trust that management has its act together and will be able to deliver a profit and strong balance sheet year after year. That means you will need processes for business planning, marketing, doing the work, hiring, and more, reinforced by a strong culture throughout the company. STOP reading if your processes are undefined or the firm is in disarray and FIX IT. You cannot get out if this element on the critical path to departure is undone.
With strong second-tier leaders in place that you have complete confidence in, and a really well-defined set of working processes for how you do everything the company does, you then need to think about what you’ll do when you do actually get out. A lot of people do not consider this. They work like dogs their entire lives with a goal of a comfortable retirement but end up hating it because they have no hobbies, no outside interests, and no other business ventures to throw themselves into. It’s sad. Don’t be one of these people. And while we’re on the topic of what you’ll do in your post-firm life, have you talked with your spouse about it? Your spouse needs to understand what your plans are and get on board. If he or she loves to golf and thinks you’ll be golfing with them five days a week post-retirement, while you are looking forward to many long solo motorcycle trips, you have a problem. Things may not work out for you in the end. Have these discussions with your spouse NOW.
There’s one more thing that needs consideration. Have you thought about how much money you’ll need? You may think you’re ready to cut back on your lavish lifestyle, but many people who have been successful with their careers find this very difficult to do. Personal overhead climbs with affluence. Lots of expensive restaurant dinners, high-end vehicles, vacations, vacation homes— you get the idea. The bottom line is that you may find it hard to do less than you are accustomed to. And if you don’t, your family might. This takes a lot of thought about how much you really need to have amassed before getting out as well as many discussions around the family dinner table about your post-retirement financial situation. For most of us a change from “every year is better than the last” to “this is probably the most we’ll ever make” can be difficult.
Getting out is never easy. But it can give you a chance to lead a very rewarding “second life.” As someone who’s done it himself, I have a lot to say about this topic. Keep your eyes open for a possible new seminar series in 2008 on this topic!
Originally published 7/16/2007
About Zweig Group
Zweig Group, three times on the Inc. 500/5000 list, is the industry leader and premiere authority in AEC firm management and marketing, the go-to source for data and research, and the leading provider of customized learning and training. Zweig Group exists to help AEC firms succeed in a complicated and challenging marketplace through services that include: Mergers & Acquisitions, Strategic Planning, Valuation, Executive Search, Board of Director Services, Ownership Transition, Marketing & Branding, and Business Development Training. The firm has offices in Dallas and Fayetteville, Arkansas.