Your future boss is about to be born

About this Video:

Have you ever assumed your child would eventually take over the business you spent decades building? I understand the temptation. We want the story to continue, and handing the keys to our kids can feel like the natural ending.

In this video, I share what I've learned about family business succession, including my own experience working for my father for exactly two weeks. I explore why succession is often the parent's dream rather than the child's, why an employee mindset can make ownership difficult, and one surprisingly simple lesson I learned about incentives. Sometimes, you don't create an owner with a title. You create one by giving them real stakes.


Transcript:

I heard a story once that could just as easily been about me.

A business owner gets a call that his wife's gone into labor. He grabs his keys and on his way out the door, he turns to the office and announces, "Your future boss is about to be born."

The child isn't even here yet, hasn't taken a breath, and dad's already handing the corner office.

Now, my first reaction to that, I judged the guy. Come on, the kid's not even born and you've written his whole life for him? But my second reaction was quieter. It was recognition because I know that feeling.

I looked at my own children and quietly filled in the job description they never applied for. I just did it in my head instead of in front of the staff.

And here's the part of the story we're sitting with.

His son never ended up running the place. All that certainty, and it just didn't happen.

I mostly dodged this landmine by luck. I sold my food service company when my son was about twelve and my daughter was about ten.

By the time they were teenagers, there was no company to join. The decision that trips up so many families never landed on my doorstep.

But I think about the other version of my life, the one where I still own that company when they hit eighteen, and honestly, I'm not sure I'd have handled it well.

My daughter would have looked at me dead in the eye and said, "No," and she'd have been right.

My son, though he was bouncing around a bit in those years, still finding his footing, I could see a world where he joined me, not because it lit him up, because it was there and I was his dad.

And that's exactly the setup that goes sideways.

Because if he joined me for my reason instead of his, we may have butted heads, maybe worse than my own dad and I did.

You wanna know how long I lasted working for my father?

Two weeks.

That's it.

So here's what I've come to believe, and I've watched it play out over and over.

Family succession is usually the parent's dream, not the child's.

That's not a knock on you, and it's not a knock on your child. It's just the truth.

You build something for thirty years, and handing it to someone with your last name feels like the story's supposed to end.

Of course you want it, but wanting it isn't the same as it working, and the numbers are sobering.

Only about thirty percent of family businesses make it to the second generation. About twelve percent make it to the third, and just three percent survive to the fourth.

Now, people argue about exactly what those numbers mean. I'll be fair about that, but everybody agrees on the direction: that baton gets dropped a lot more than it gets cleanly passed.

Now, does it ever work?

Yeah, it does.

I've lived a piece of it, but in my experience, there's really only one version that works.

The child grows up in the business, not handed the keys at thirty, not parachuted into a VP title out of college.

Start by sweeping floors, riding along on deliveries, doing the jobs nobody wants, earning their way up an inch at a time, because when they're earned it, they've got the respect of the people they're leading.

That's the whole ball game.

But even then, there's one challenge I hit almost every single time.

The child has an employee mentality, and the business needs an owner's mentality.

Think about it.

If they worked their way up, they've spent years as an employee. Show up, do good work, go home, leave the problems at the office.

Great way to be an employee.

Terrible way to be an owner, because an owner doesn't get to leave the problems at the office.

For a long time, I didn't have an answer for how to flip that switch.

Then a client taught me.

We had a father and his child, and we were this close to giving up. Capable kid, but that owner's mindset just wasn't showing up.

So as a last swing, we changed one thing.

We changed how the son got paid.

We tied their pay to how the company actually performed. Do well, they do well. Struggle, they feel it.

Like flipping a switch.

Suddenly they cared about the slow month, because the slow month showed up in their pocket.

The distance between the company's problem and my problem just collapsed, and that taught me something I've carried ever since.

Mentality follows incentives.

You want somebody to think like an owner, you gotta let them win and lose like one.

So if you own a business, and you have children, sit with these three things.

Whose dream is this really?

If it's yours, that's okay. Just name it.

If you want a shot at working at it, get them young and let them earn it.

And when they're ready to lead, look hard at how they're paid.

The title doesn't create an owner, the stakes do.

You know, I don't have this fully figured out. Nobody does.

And I wanna hear from you.

Did it work in your family?

Did it blow up?

Tell me your story in the comments.

I'll be reading every single one, and I'll see you back here next week.