Many Texas entrepreneurs make considerable sacrifices as they work diligently to build their businesses, but a June 23 survey released by U.S. Trust indicates that many of them likely pay little attention to what would happen to their ventures if they were to pass away. The survey looked at the behavior of 118 business-owning millionaires, and it reveals that almost two-thirds of them have no succession plan in place.
Observers point out that over three quarters of the business owners surveyed were entrepreneurs who started their own companies and would be unlikely to consider giving them up. These individuals often plan on working well after others have chosen to retire, and they may feel little need to focus on events that still seem a long way off. However, the survey also revealed that even business owners approaching their golden years rarely have a plan in place for the sale or transfer of their corporation. This may be because only 16 percent of those surveyed said that they planned to pass their business to their families.
The survey also found that women business owners were more likely to draft a succession plan than men, and younger entrepreneurs were more proactive in this area than their more seasoned counterparts. Experts point out that succession plans do not only come into play when a business owner dies. Such plans may prove invaluable when the circumstances of owners change or they become ill or suffer an injury that prevents them from working.
Experienced business law attorneys will likely understand that the enthusiasm common among entrepreneurs often prevents them from taking steps to prepare for unpleasant possibilities. Legal counsel might provide a voice of caution and suggest that a comprehensive succession plan be put into place.