Sleepless nights? How we can put entrepreneurs minds to rest
Entrepreneurs are fascinating. Their thirst for business and life is unquenchable but most tell a similar tale of a lonely, financially challenging and time-consuming start to their business life. Over time, hard work and commitment gradually pays off, but while staff numbers and profits can grow to ease the pains of loneliness and financial worry, the time demand doesn’t ever seem to recede. If anything, time becomes an increasingly valuable commodity during an entrepreneur’s career.
Ultimately, they can’t do absolutely everything.
Business owners therefore engage with various professional advisers during their career. Sometimes this is an unavoidable necessity (financial audits, regulatory inspections, legal challenges, etc.) but it is often the voluntary professional engagements that, in time, provide true value. Most successful entrepreneurs have a trusted adviser; someone they can talk to who knows their business well but can still be trusted to be objective, discreet and honest.
Alongside that ongoing relationship is a black book of contacts, a priceless list of other professionals who can be relied upon to parachute in from time to time to help with specialist projects and irregular advice needs. Often, the business will also employ a financial director to help coordinate all of this.
Over the years, the team at Womble Bond Dickinson has helped many entrepreneurs and executives successfully transition from work into retirement. We often hear that business owners are shell-shocked to find their team of trusted advisers are no longer on call as they once were during their working life. This is not to suggest anything untoward, simply a fact of life that either their professional connections will have also reached an age where they too are calling it a day, or perhaps they have moved on to engage with the next upcoming business venture since that is their skill set.
It is at this crucial time that things can begin to go wrong for the unadvised. An entrepreneur’s natural reaction is, understandably, to revert back to those dark days when they just had to get on and do everything themselves – except this time the difference is that they aren’t really in control. Outside of working life there is a limit on what passion and dedication can achieve: savings, investments, pensions and tax aren’t really things that can be ‘persuaded’ that much one way or the other, no matter how well you personally sell your case. The fact of the matter is that strategy, selection and monitoring is crucial. As such, experience and know-how is, quite simply, essential.
Too frequently, entrepreneurs exit a business without giving proper thought to the form that the exit should take. From a personal perspective, they may find themselves losing valuable Inheritance Tax breaks, potentially reducing their family’s wealth by 40 per cent, losing valuable company benefits, life assurance, critical illness, private medical insurance, pension provision – the list is endless. A pre-sale/succession ‘audit’ focused on the entrepreneur, rather than just the business, is of paramount importance.
Our private wealth team that works across the firm has over 200 years of experience in advising families and their businesses. We liken ourselves to being our client’s personal finance director and can help pull everything together as part of a comprehensive plan. This often requires the coordination of specialist experts, such as lawyers, tax consultants and investment managers.
So, what keeps you awake at night? If the answer is ‘my business and my family’ then you are not alone and we can help.