Blogs

Business Owner Transition as a succession strategy - What is it ?

If you want to be more educated on your succession options catch a video interview with Ryan Melton and Platform 1 Director, Mike Warmington.

John has a successful medium sized business that has a turnover of about $6M and a reasonable profit. The problem is he is tied to it and can’t get to the Bach or go fishing as much as he would like. Getting in a GM seems like the answer and his accountant recommends a successful sales manager, Peter, who he believes is ready to step up to a GM role. Peter is 32 and currently works for a much larger business. John likes Peter and offers him the role after the first meeting. Peter is happy because it is a step up for him in both responsibility and salary.

In this Podcast Craig Oliver talks to Rob Young & Mike Warmington of Platform 1 about Business Owner Transition and how Platform 1 is helping not only business owners successfully exit their business in a profitable and structured way, but also how their model allows motivated individuals to gradually buy into a successful business and continue to build on its legacy.

There are a variety of reasons why you may consider exiting your business. From our experience it is often not all about a business owner just wanting to do a" financial transaction". Leaving a legacy is important to almost all the business owners we see whether they initially realise it or not. When and how to exit your business is an emotional decision with several variables in play:

If you headed to the beach this summer you would have seen many great baches and beautiful boats. What you may not be aware of is many of the owners of these assets are business owners, not accounting or law partners or CEO's.

Much of the wealth evident at the key holiday spots is with ordinary people who had the conviction to get into their own businesses.
There are great opportunities for talented entrepreneurial individuals to exit corporate life and take an equity opportunity in a smaller private business.

Scalable Businesses With Growth Opportunities in Short Supply

In November 2021 Platform 1 conducted a market survey titled: Attitudes To Entering Business Ownership Following Covid 19.

Data from this survey of potential future business acquirers shows that despite the pandemic, there is still not enough scalable businesses available. Over 65% of all respondents mentioned that they were finding it hard to find a scalable business with growth opportunities. This increased to 77% when measured only against those exclusively looking for a business. They also mentioned that many of the businesses available were too small.

The numerous lockdowns have been frustrating many business owners contemplating succession, particularly in Auckland. Some have delayed plans or been in a holding pattern. Others now however are taking the opportunity to start moving. The talent pool of people with capital is here now and they also are ready to move.

Press Release
13 September 2021
Auckland, New Zealand

After a turbulent 18 months for business owners, business owner transition company Platform 1 have found owners facing succession are starting now to think about moving forward. We know now that Covid will have some impact on lives and businesses for some time to come, so will there be an acceleration of business owners exiting ?

Business Owner Transition is a method of exiting your private business, over time, to an external talented person with capital. This person works full-time in your business and buys you out over time to an agreed plan.