2022 New Year Planning

A Discussion with Kevin Brown of RBTK & John Wheeler of Akili Capital

Kevin Brown:

Hi, this is Kevin Brown, managing partner at RBTK. We’re starting off the new year and what is one of the typical things we tend to do in the new year? We make new year’s resolutions. Well, any resolution requires good planning. So, most of the clients we work at RBTK are closely held businesses and their owners and entrepreneurs. And there are a number of things to plan for as you come into the new year when you own your own business.  Typically, owners look at planning as just planning for the year ahead but we believe you have to look at planning from a strategic standpoint and that means long term planning. And there are a number of things to consider when you look at strategic planning beyond just the year ahead.

Even if you have the plan for the year, we believe you have to have contingency plans. Unfortunately, as we all probably remember two years ago, we may have had a great plan at the beginning of 2020, but then something called COVID hit us. That caused a lot of reaction from business owners. Nobody can predict the future, but if you put some contingencies in place then if something like that comes up again you will be more prepared. More importantly, in the long term business owners need to be thinking about how am I going to transition my business? Why would I want to transition my business? Maybe to whom, or how? This is a key issue and I’ve always felt the day you start your business is the day you should consider transitioning it.

So today I have John Wheeler with Akili Capital joining me and he works with a lot of entrepreneurs and business owners that transfer wealth, and even their businesses. So, John, what are your thoughts on the issue of planning and taking a long term look at things?

John Wheeler:

Yes, Kevin you’ve hit on a couple of really important points. Planning the exit or the succession of your business the day you start is something every entrepreneur or business owner has probably heard of, or has even thought of. The challenge we find in working with most of our clients, is how do you take that idea from a concept and actually get it into a document that you can act on? Something you can communicate to key people and key advisors so when that day comes, and sometimes it shows up and the owner is not there, those types of contingencies are in place. There can also be health issues that can completely disrupt your operations. So, having a plan documented and written down so you can communicate to the right people is very important.

It is oftentimes difficult to take the idea that you might have in your head and actually get it into a written form that would be recognized in a court of law, that would be a legal document. And that’s where working with someone like Kevin and myself can be of huge value, especially if you have us working together with you, because we’re good at helping you uncover what it is you’re really trying to accomplish. It’s not just as simple as, “How do I transfer the ownership to someone else, or how do I sell the company?” There is far more involved with really planning that out including the psychological impact for the owner. What I often find with a lot of our clients are the challenges of the implications of selling the business. There could be millions and millions of dollars that the family is now responsible for so there are a lot of other elements to consider beyond just who controls the company, and who’s running it.

Kevin Brown:

And so, what I’d like to do is challenge business owners to start your plan this year, your typical plan for the year. Two items I’d recommend are to write down and look at how you will react to a contingency? And what do you need to be prepared for? And on that long term side, just one issue to consider, “What would a successful transition of your business look like?”
If you do that, that is a great start to that process. And if you want someone to help you with that process, and help take you and guide you through it to get you to where you want to be, please reach out to us at RBTK.