In this issue
At some point in their lives business owners have to close their eyes and start having a few new dreams. By age 40 or so, parents need to look around at their children and ask, “For whom am I building this business? Who will become my successors in time?” And if they truly dream that their children will one day own and manage the company, they must ask a corollary question, “How will I know which among them will make the best leaders for the future?”
Placing the family business or estate in trust is often an essential element in estate planning.However, in recent years, the specter of personal environmental liability has been a black cloudhanging over certain trustees.
There iswonderful diversity in the business sector we call familybusiness—huge enterprises like Cargill and local grocery stores, first- and fourth-generationcompanies, firms run by patriarchs and cousins. But the field lacks a typology, which could be usefulto everyone from consultants and direct marketers to owners trying to analyze their firms.
A five-member panel convened by Family Business agreed there is plenty of private capitalaround these days for family companies wishing to finance succession or take a leap to the next levelin size. The range of options can, in fact, be a little bewildering. Commercial banks provide workingcapital, and some do private placements. Many firms offer venture capital, sometimes in combinationwith a public offering. Others specialize in “mezzanine” financing, or subordinated debt. Smallerlenders and investment firms are popping up all over the country.