1)  External Buyers:  These transactions are called Mergers & Acquisitions.

Privately held companies can sold to a competitor for strategic reasons, someone new to the market, or a private equity firm. If you want your vision to continue, you'll need time to vet your potential buyer for values alignment and create meaningful agreements to memorialize the promises or expectations.  

Going Public is another way for owners to sell their interests.  However, an IPO is very costly.

2)  Internal Buyers:  Family, Executives, Employees

It used to be common for owners to leave a business to a family member.  Today, executive managers and employees are typically better candidates.  They may receive equity or stock options as part of a compensation package.  Employee Stock Ownership Plans offer companies significant tax benefits without turning their employees into "shareholders."  

We're also pretty excited about conversions to worker-owned Cooperative Associations. These are terrific vehicles for passing a owned business to the employees and honoring the sweat equity they've already put in.

3)  No Buyers = Business Liquidation

If a business owner hasn't created a succession plan the business will eventually go away.  The result is a total loss to the business owner or the owner's family.


With some advance planning and specific inquiry founders can smoothly transition organizations into new hands.

Business Succession is what happens to the company when a founder or executive owner leaves.  This conversation is also relevant to tax exempt organizations when boards of directors significantly change.

A solid succession strategy contemplates transfer of leadership upon founder retirement or any other voluntary choice of an executive to leave. The goal is to preserve the value of the organization so that it continues successfully, and the outgoing executives are compensated for their part in creating the ongoing value. 

Your legal instruments may or may not help you ensure consistent changes, which will impact everyone associated with the organization inside and out.  There are many options and vehicles for structuring the best fit for your organizational change.  

It can take quite some time to plan and execute well.  Often there are steps you can take well in advance to be prepared when it's time.  So let's talk about this sooner than later.