After working for 22 years at Sapers & Wallack, an insurance, benefits and wealth management firm, Norman Wallack wanted to retire in 1985. He told his partner, Bill Sapers, how much money he thought he needed from their business, now based in Newton, Mass., for his retirement.
“I said no,” recalls Bill, now 84, who remains chairman. The amount Norm, now 91, requested “was not sufficient,” he says, “and I doubled that. I didn’t think it was being generous, I just thought it was being fair.”
Four years later, Norm approached Bill with a complaint: His retirement payment was too large, and the amount made him uncomfortable. Bill reluctantly adjusted it. “That was the only fight we ever had,” Bill says.
Today the firm—founded by Bill’s father, Abe Sapers, in 1932—is headed by CEO Aviva Sapers, 50, Bill’s daughter. She works alongside Norm’s son Ed Wallack, 57, who holds the title of president. Aviva, who represents the third generation of the Sapers family to work in the firm, and Ed, who represents the second generation of the Wallack family, have built on their fathers’ foundation to establish their own partnership.
“Ed and I have maintained the same philosophy,” Aviva says. “The communications piece is a little more challenging because we’re not in the same social circle together. But as long as we make sure we talk about things, work together on where we think we’re headed, it’s worked real-ly well. And similar to Dad and Norm, Ed and I bring complementary skills to the table.”
The early years
Abe Sapers founded Abraham E. Sapers as a general agency. He enjoyed the work and was successful enough that he convinced his son to spend the summer selling insurance in 1948. Then Bill went on to earn a master’s degree in finance from Boston University.
Bill left after he was drafted into the U.S. Army. Then he went to Officer Candidate School and became a lieutenant in the U.S. Army Finance Corps during the Korean War. However, he didn’t stop selling; he provided insurance and financial planning services to his fellow officers. After his service in 1953, instead of rejoining his father, he decided to open his own agency so he could sell multiple companies’ policies. Four years later, he invited his father to become his partner.
“Dad came into the business on his own terms,” Aviva says. “Abe hoped Dad would do more office work so he could go out and sell, but Dad wrote a ton of insurance and outproduced my grandfather in spades.”
That agency steadily grew. In 1963 Bill and Abe brought in Norman Wallack as a partner. Bill had met Norm during sales training they both attended at New England Mutual Life Insurance Company. Norm and Bill each owned 45%; Abe, who had decreased his involvement, owned 10%, Bill says.
Abe continued to come into the office into his 80s, but he was content to let go of the reins. “After he retired [in 1975], we each got the other 5%,” Bill says.
Although both Bill and Norm sold policies, Bill also ran the administrative side of the business. They kept their compensation equal regardless of how much they each sold. “We never looked to see whether one was outdoing the other,” notes Bill. “We had complete trust in each other.”
In addition to selling life and health policies, Sapers & Wallack began offering new services, such as estate planning and employee benefits, in the 1960s and 1970s. Investment advisory services, executive benefits and a charitable giving unit that was Bill’s brainchild, called Charitable Concepts, are also now among the company’s offerings. Today the firm employs 32 financial services professionals and generates annual revenues of $6 million. Its clients include Fortune 1,000 corporations, non-profit organizations, closely held firms, venture capital-backed startups and high-net-worth individuals.
Enter the next generation
Norm’s son Ed joined the company in 1982, when revenues were in the neighborhood of $1.5 million. Ed, who graduated from college in 1977, trained and worked as a life insurance salesperson at a New England Life agency for two years after graduating college. Recognizing a need for advanced training to break into the estate planning and business market, Ed earned a law degree from Suffolk University Law School. “I was 22 years old and had no gray hair,” he recalls. “Who’s going to listen to a 22-year-old? It takes a lot of chutzpah to walk into an office and ask for the owner. I needed more credentials.”
After he attained those credentials, he joined Sapers & Wallack. Ed says he wanted to earn his stripes before joining his father’s firm. “Sapers & Wallack was not a training ground,” he says. His father had wanted his oldest brother to work at the firm, but that arrangement did not work out, Ed says. “When I came along, he told me to make my own decision.” During Ed’s first 12 months at Sapers & Wallack, Norm and Bill had him intern at different departments before he started selling.
Aviva Sapers began five years after Ed came on board. She had worked summers at the firm, mostly stuffing envelopes, and says she wasn’t sure what to do after college, except that she wanted to help people and make a good living. When she told her father she thought his business might be a good way to do that, “his smile went from Boston to New York,” she remembers.
Even though their fathers were close, Aviva and Ed didn’t know each other well. “Our families used to do stuff together [when the children were young], so it’s not as if we were complete strangers,” Aviva says. But it wasn’t until she started sitting in on board meetings that she and Ed began to get to know each other.
Initially, Aviva stayed close to her father, following him around on sales calls while she studied for her insurance license. “I watched and asked questions,” she says. Bill taught her about charitable giving concepts and then sent her to call on a high-powered client. “I failed miserably, but that didn’t discourage me,” she remembers. “I thought I could do this. Dad suggested I learn the business elsewhere.”
She left the firm to join an agency in Philadelphia. After 14 months she moved back to Boston to join the same sales training program Ed, Bill and Norm had taken at New England Mutual. “Two years later I made the million-dollar roundtable,” Aviva says. Then she felt ready to return to Sapers & Wallack.
Titles, pay and personalities
In the late 1990s, the time came to figure out who would run the company in the future. The two families determined that Aviva was best suited to be the next CEO.
“I’m more of an introvert; she’s much more of a people person,” Ed comments. “I’m people-oriented when I’m selling, but I could probably be a hermit when I’m done working. She loves to be around people.” Ed has taken on the role of treasurer at the firm.
Just as their fathers did, Aviva and Ed have equal ownership and equal pay. Bill owned 50%; Aviva and Ed each received half of Norm’s 50% stake after Norm retired. About four years ago, the two next-generation members bought some of Bill’s shares. Today, the three partners each own 33.3%.
While titles, roles and compensation were relatively easy to figure out, Aviva and Ed needed to learn how to work together and to understand each other’s style and personality. “Early on we were meeting regularly, having coffees once a week to talk about stuff,” says Ed. “We probably should start doing that again. It was good to talk about issues, how we see the business going and personnel issues. Meeting regularly was very good. We got to know each other on a personal level.”
Still, they found themselves periodically locking horns and often used Bill as a mediator, Aviva says. “If Ed and I were stalemated, we’d say, ‘Let’s see what Bill says.’ He’s very good at laying out the positives, the negatives, and having you look at an issue through a different lens. It’s very helpful.”
“Sitting in meetings and watching them vie with each other took a lot of patience and work,” Bill says. Today, Aviva and Ed say they settle most disagreements without Bill’s involvement.
But what will happen when Bill is no longer around to settle disputes? A problem could arise if Aviva and Ed both own half of the shares, says family business consultant Leslie Dashew, a partner with the Aspen Family Business Group and principal of Human Side of Enterprises in Scottsdale, Ariz. “What if one wants to expand and the other wants to stay the same size or if one wants to take on debt and the other doesn’t want to?” Dashew asks. “That’s where a board comes in handy.”
Sapers & Wallack’s board of directors currently consists only of the three partners, with a lawyer as a non-voting participant. Every couple of years they consider bringing in one or two outside board members, the partners say, but thus far they have not done so. “At this stage of the game I assume that [Ed and Aviva] have arrived at a modus operandi that is working pretty well,” Bill says. “Like in marriage, if eventually they can’t work it out they will break it up.”
“At this point in time, I’ve seen the results,” says Ed. “So I don’t need to be involved in every decision. I don’t have the time or the inclination to micromanage every decision that’s being made.”
Bill observes that Aviva’s management style is different from his. “Fathers don’t want to give up control,” says the patriarch, who adds that he’s seen this pattern often in the firm’s family business clients.
“I’m a benevolent dictator,” Bill says. “My daughter runs the business by consensus. It’s a new world. But if you want your children to take over and run the business, you have to accept that they will run it differently. It’s not something many of my peers accept or do that well. You have to make sure you do it well for your successors.”
Aviva and her wife, Judith, have two sons: Jonah, eight, and Ari, ten. Ed and his wife, Margo, also have two children, though they are older. Zach, 25, is in his last year of law school; daughter Courtney, 23, just received a master’s degree in teaching. She’s currently a ski instructor in Colorado and then plans to become a teacher. Neither is ready to consider joining the firm, Ed says.
Bill scoffs at the idea of a formal family employment policy. “I don’t believe you can figure all these things out,” he asserts. “Times change, and when you try to establish a policy, personalities play a big part in the family business. I don’t think policies are as important as the partners.
“We’re lucky, though. We have a successful business. It’s easy to do things this way when things are good.”
Jayne A. Pearl is a freelance writer, editor and speaker. She is co-author, with Richard A. Morris, of Kids, Wealth, and Consequences (Bloomberg, a Wiley imprint, 2010; www.kwandc.com), and a new series of guide books, including Kids and Money Guide to Learning Capital (ALLL Right Books, 2012; www.kidsandmoney.com).
Copyright 2013 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact bwenger@familybusinessmagazine.com.