Family Business Director

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.

June 15, 2023 Special Topics

Just Released: 2023 Benchmarking Guide for Family Business Directors

The business landscape of 2022 was like a competitive football game, where the repercussions of inflation, rising interest rates, and global conflicts felt like a stonewall defense. Still, businesses found ways to hold their ground, providing key takeaways for family businesses, as dissected in our comprehensive 2023 Benchmarking Guide. Our guide helps family business directors understand how to make important financial decisions, like setting dividend policies, making investments, and arranging financing, while analyzing the shifts in capital allocation amid the changing financial climate.

June 5, 2023 Special Topics Valuation

Tax Court Sides with Family Business in Cecil

In this week’s post, we analyze the recent Tax Court case, Cecil v. Commissioner. A key issue in the case was the role of appreciated corporate assets in determining the fair market value of a minority interest in an operating company. The Cecil family has owned and operated the Biltmore mansion in Ashville, North Carolina for decades, and the case highlights the intersection of the asset-based, income, and market approaches to valuation, and serves as an important reminder to families evaluating their own estate plans in light of the approaching sunset provisions in the Tax Cut and Jobs Act of 2017.

May 30, 2023 Valuation

Steps in a Business Valuation

New Video Released on Family Business On Demand Resource Center

Demystify the intricate process of business valuation in our short 5-minute video. Gain a deeper understanding of the key factors influencing your company’s value, including industry context, economic environment, and the role of control and marketability.

May 22, 2023 Capital Budgeting Planning & Strategy Shareholder Engagement

Lessons from the Oracle of Omaha

Warren Buffett is regarded as one of the world’s preeminent investors and most shrewd businessmen. Buffett and his partner, Charlie Munger recently drew thousands to Berkshire Hathaway’s annual meeting in Omaha. Buffett’s 2022 shareholder letter analyzes the company’s strategy, performance, and vision for the company going forward. This year’s letter provides several lessons for investors and family businesses alike. 

May 16, 2023 Capital Structure Planning & Strategy

Book Review: The Psychology of Money

In “The Psychology of Money,” Morgan Housel challenges the conventional view of financial decisions being purely data-driven. He emphasizes the role of luck, risk, and adaptability in financial outcomes. His lessons include the importance of recognizing risk and luck rather than skill, focusing on broader patterns rather than individual cases, and maintaining adaptability in long-term financial planning. This analysis provides a fresh perspective on managing family businesses and reshaping financial decision-making.