When Your Kids Don't Want the Family Business: Succession Options

It isn't a failure, and closing isn't your only option. Have the conversation early and plan before burnout leaves you no time.

Not tax or legal advice. This article is general information based on my own experience selling a business. Every business and deal is different. Talk with your own CPA, attorney and financial advisor before acting on anything here.

The short answer

If your kids don't want the business, you still have options: selling to managers, employees, a strategic buyer, private equity or an individual buyer. But those options take time to set up. Have the conversation with your family early, don't assume either way, and plan before burnout makes closing the doors look like the easy answer. It rarely is for anyone else.

A story about winding down

I sit on succession and exit planning panels, and I keep meeting owners in this spot. One I met (some details changed) ran a third-generation family business. She was burned out, and her kids had made it clear they didn't want it. So she decided to wind it down and close.

I understand why. She was tired. But closing hurt people. Employees who had been there for years were suddenly out of work. Customers had to scramble. And decades of value, the name, the relationships and the team, went away.

It didn't have to go that way

Any of the other exit options might have kept the doors open, kept people employed and paid her for what three generations built. Those options take time to set up, and when you're burned out, time is the thing you don't have.

Three things to do

Remember it's not a failure. Your kids get to choose their own lives, just like you did.
Have the conversation early. Waiting for a child who never wanted the business can cost you years. And sometimes the one who seems least interested would say yes if someone asked.
Plan before you're burned out. Burnout makes every option look harder and makes closing look easy.

The best exit plan

A business that runs on people and processes instead of on you keeps every door open, even on the day you're tired. That's why I say the best exit plan is building a business you don't need to sell. (See how early to start.)

One thing to try this week

Ask your kids directly what they want. Then really listen to the answer.

What if your kids don't want the business?