Resolving Founder Dependency

There are a lot of small businesses in the marketplace that are doing just fine. If they are a first generation business, the founder owners are still the driving force in the business. When the business owner starts looking to the future from the position of current stability and prosperity, some common scenarios appear.

Common issues

1)     The skills the founder used to build the business up until now are not the skills needed to take the business to the next level.

2)     The desire to grow is replaced by the desire to take more time away from the business and enjoy life.

3)     Should we just sell it? 

Related article – Succession Planning Advice

While this scenario may at first seem like a major dilemma, there is a one path forward that solves all three issues:

Work on reducing the reliance on the business owners by increasing the responsibilities and skills of key employees and by improving systematization.


1)     The business is more saleable if it less reliant on the current owners. The effort to make the business more saleable is the same as the effort to make it more valuable to keep.

2)     The probability of key employees to step into more responsible leadership type roles increases. These employees witnessed the amount of work it took to operate the business when it was too dependent on the owners and frankly they are not interested in working that hard. However, if the business is groomed to provide a reasonable quality of life for the current and future owners, the potential future owners will naturally be more interested in that kind of job.

3)     The expansion of the management team provides the ability to include those with skills that are complementary to the current owners. Looking for key people with some human resource talents or systematization skills is one possibility. It is important to make sure there is a cultural fit first before looking at specific skills. This is why grooming up current employees that already fit the culture is such a desirable option to pursue.

On one hand, it may seem I have made the future direction of a successful business seem too simple. On the other hand, there is a lot of flexibility in designing a future that accomplishes the goal of reducing the reliance on the current owner and giving them more freedom from the business.

By; Paul Foster,