Starting and growing a business requires an enormous amount of dedication and hard work, as the majority of North Carolina business owners know. Thus, the decision to leave a successful business in the hands of a family member, especially one who is a millennial, may require some forethought.
Compared with the baby boomer generation, many millennials have a different mindset about business, life and work. They are characterized as being slow to commit themselves and tend to be infatuated with social media and technology. Considering these points, those in the baby boomer generation who are thinking of giving or selling their business to a young adult might want to first learn if the person will be motivated and passionate about the business. Otherwise, the business could eventually deteriorate and completely fail because of the new owner’s lack of interest.
Another important factor to consider is if the family member can afford to purchase the company. If the family member resembles the millennial generation that is overburdened with debt, it is likely that he or she will not be able to obtain financing for a small business loan. However, if the person shows a true interest in the company, a succession plan allowing the individual to move slowly into an ownership position via sweat equity might be an attractive option.
Buying or selling a business can be quite complicated, even in situations where the buyer and seller are related. To help ensure a smooth business transaction, sellers and buyers alike might benefit from the advice of experienced business attorneys who could assist with running credit checks, making sure there are no liens against any business assets and drafting the legal documents. The attorney could also help sellers who want to finance the business by drafting promissory notes.
Source: All Business, “3 Questions to Ask Before You Leave Your Business to a Millennial”, Gerri Detweiler, March 13, 2017