Family Business Director

August 22, 2023 Planning & Strategy Taxes

Navigating the Estate Tax Horizon

The Time Is Now

There is an urgency to consider a range of estate tax strategy options in order to maximize gifting family wealth rather than family drama. The options range from straightforward gifts to heirs, accelerated gifting, use of irrevocable trusts, and other estate freeze tactics to lock in assets at current value and transfer future appreciation to heirs without triggering additional taxes. Why? The current basic exclusion amount ($12.92 million per individual) is due to sunset to its pre-TCJA level of $5 million, as adjusted for inflation, at the end of 2025. Tax planners expect a spike in estate planning transactions between now and then. Don’t be caught unprepared. Read more in this week’s post.

August 15, 2023 M&A Planning & Strategy

Private Equity (Still) Wants to Buy Your Family Business

Private equity and institutional investors have been increasingly targeting family-owned businesses for potential acquisition. Recent industry data shows that smaller deals account for over 61% of all private equity transactions in the first quarter of 2023, and founder-owned business purchases, especially those valued under $100 million, are rising. In this week’s post, we look at some of the pros and cons of private equity investment in your family business.

August 7, 2023 Performance Measurement Planning & Strategy Shareholder Engagement

How to Communicate Financial Results to Family Shareholders

Whitepaper Release

Everyone agrees that communication promotes positive shareholder engagement, but what does it look like to communicate financial results effectively? In this week’s blog we introduce a whitepaper that offers practical suggestions for presenting key financial data in ways that family shareholders find useful.

July 31, 2023 Dividend Policy

Dividend Policy for Family Businesses

New Video Released on Family Business On Demand Resource Center

Travis Harms provides an insightful examination into the important topic of dividend policy in family businesses. He explains how to go about the decision-making process regarding distribution and why considering various shareholder characteristics and business attributes matters. He breaks it down into four types of dividend policies, highlighting the balance between shareholder certainty and board discretion, fostering a better understanding of maintaining the sustainability of the business, and promoting positive shareholder engagement.

July 24, 2023 Planning & Strategy

A Tale of Two Shoes

The contrasting fates of shoe brands Hoka and Allbirds in recent years have provided a couple important lessons for family business directors. As part of its growth strategy, Hoka harnessed the value of scarcity. Allbirds, on the other hand, stumbled by losing sight of its core customer in the race to pursue continued topline growth. In this post, we review these contrasting narratives to help family business directors evaluate their own growth strategies.

July 18, 2023 Capital Budgeting Capital Structure Dividend Policy

Managing Your Complete Family Business Balance Sheet

Your family business may likely be one of your largest assets, but not the only asset. Thinking holistically about your family’s complete balance sheet, not just the operating of the business, is a good mindset for fostering longevity, family harmony, and shareholder engagement.

In this post, we discuss three key financial areas that family businesses generally focus on. Having an accurate picture of the complete family balance sheet will help inform the ultimate decisions made at the family business level that optimize shareholder returns and maximize total family wealth.

July 11, 2023 Planning & Strategy

Earnings Season

As the U.S. enters another earnings season with anticipated profit drops, family businesses are encouraged to leverage these reporting periods for enhanced internal communication and strategic planning. Unlike public companies focusing on quarterly results, family businesses prioritize long-term decision making, but can still improve shareholder relations by consistent, contextual, and future-oriented reporting. Family businesses should identify if they are in a “planting” or “harvesting” phase, as it may significantly influence their growth strategy and investment decisions.

July 5, 2023 Special Topics

What We’ve Been Reading

This week we’ve compiled a brief reading list of items we’ve found to be interesting and informative in the past couple of weeks.  Think of it as your Family Business Director summer reading list. 

June 27, 2023 Special Topics

Economic Indicators for Family Businesses

New Video Released on Family Business On Demand Resource Center

In this video, Tripp Crews discusses a few key economic indicators that family business owners and directors would be well-served to keep an eye on as we continue to navigate through a turbulent macroeconomic environment. Having a working knowledge of these indicators can help inform decision-making processes for owners and directors both in the office and in the board room.

June 19, 2023 Performance Measurement Valuation

The Hardest Thing to Do in Business

Family businesses are either growing or shrinking. Since shrinking is not an attractive option, we explore the three primary avenues of growth for family businesses in this week’s post, posing some key questions for your directors and managers to consider as they formulate growth strategies.