We've all seen, heard, or been a part of this story before. A local business begins to fade away. Sometimes slowly. Sometimes overnight.
And then it’s gone.
You drive by where it used to be. The grass is tall, uncut. The paint is peeling and faded. Letters hanging off of a weathered sign. A parking lot once filled with cars, now filled with potholes.
I can’t help but think of all of the stories that began to end behind those doors.
The family that owned the business that ended up with little, nothing, or worse, a heavy bill. Years, decades, and even generations of progress and opportunity lost. The chance at rewriting their family story for generations now gone like a vapor through their grasp.
The line worker who lost a steady paycheck. The technician on his second chance who finally got his first break, now suddenly displaced. The families of these workers – their stability gone.
Workers in secondary jobs laid off as dollars that once came into the community through the export of goods and services leak away and then vanish.
The list goes on.
Altogether, it’s the upside-down portrait of what was, and what could have been.
This is why good M&A matters.
“Good M&A” as I use the term, is any sale, purchase, succession planning transition or other transaction or ownership transition that maximizes the potential value of the business. For so many business owners, that value is not simply measured in dollars, it so often includes the impact on family legacy, employees, and the community.
When good M&A happens, owners, employees, families, and communities thrive and flourish.
The family that owned the business left a legacy to their kids and grandkids, changing their family for generations. Their grandchild had the means and the confidence to start the next great thing. A buyer changed her family’s legacy by repeating the virtuous cycle of community-centered business ownership.
The promising employee made it to manager, then director, and started their own great thing, transforming another family legacy. The cook at the local restaurant where all the second shift workers go, got the promotion to manager, saved that extra money and finished a degree that opened a world of new opportunities.
It’s the upside-down picture set right.
Creating good M&A can take an incredible amount of work and planning, but the formula is rather simple:
The biggest reason I see good M&A fail to happen is when the process never even starts.
So often, it involves an owner that has allowed their personal identity to become so wrapped up in their business, that even when they believe that a transition is best, they simply can’t act on it, often finding reasons to push off the decision indefinitely.
It’s understandable. As business owners we pour so much of ourselves into our businesses. It holds such a big part of us - some of our greatest joys, our deepest regrets. When things got hard, we rolled up our sleeves, rubbed some dirt on our wounds and figured it out, we grit our teeth, tightened our belts, gripped those bootstraps with cracked and bleeding hands, and we made it work.
Our businesses become a part of us. How are we supposed to let that go?
The idea of any sale or transition seems so comfortably distant. It’ll always be there. Never urgent. Always a safe distance away.
Until it isn’t.
And for many, at that point it’s too late, and the upside-down picture becomes the irreversible reality.
As business owners, we’re called to create something of significance. We’re called to cultivate the soil and to plant trees that give life and hope to so many around us. Places of growth, stability and opportunity. Places where the people we serve can flourish.
But we're only entrusted with these trees for a time. It's our responsibility to do our part to ensure that they continue to thrive long after our season of stewardship comes to an end.
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