New England Chapter of the Family Firm Institute Quarterly
Meeting, March 2, 2006
A Capital Idea - Financing Alternatives for Funding Generational
Transitions in Family Owned Businesses
Prior to considering financing alternatives for funding generational
transitions in family owned businesses, several critical steps must
be taken. If the family has not already established a family
council including shareholders and trusted advisors
from the fields of banking, law and behavioral science, it is imperative
that they do so. An interdisciplinary advisory group can walk the
family through financing alternatives and help them fully understand
the risks and rewards of each option. It is essential to involve
all shareholders, acknowledge the core values of the family and
the symbolic and practical meanings of its business. If this process
is done well, a productive and educational dialogue can begin in
which the needs of all parties are held while moving toward consensus,
a decision and crafting a financial plan. This presentation describes
a model for advising family business owners during the complex,
multifaceted succession process.
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