Busi­ness own­ers feel the forces of demands of the busi­ness, their cus­tomers, their team, their stake­hold­ers, their fam­i­ly, and often put them­selves on the bot­tom of the list.   As the busi­ness grows, expe­ri­ences ups and downs, and presents what seem like a nev­er-end­ing series of demands, the own­er may feel like their busi­ness owns them, not the oth­er way around.    Below is the sto­ry of my jour­ney from busy entre­pre­neur to retired and how I was able to plan and accom­plish the transition.

After a few decades of work­ing in the cor­po­rate rat race and man­ag­ing to work my way into the ranks of mid­dle man­age­ment for a For­tune 500 com­pa­ny, I became rest­less, unful­filled, and looked for a change.   I real­ized I was not excit­ed about how I spent my time, and the pas­sion for what I had accom­plished ear­li­er in my career was wan­ing.   The prospect of chang­ing to a dif­fer­ent com­pa­ny in a sim­i­lar role was not at all pos­i­tive.   I start­ed to look at doing my own thing, explor­ing busi­ness­es that I could start, buy, or fran­chise to get a fresh start and re-cen­ter how I spent my time.

I had a cowork­er who was feel­ing the same thing, and we both had sim­i­lar pas­sions.   One of those pas­sions was rac­ing: par­tic­i­pat­ing in rac­ing, watch­ing rac­ing, being around oth­er fans and par­tic­i­pants.    It’s how we spent our week­ends, what we spent our extra mon­ey on – it’s what brought us joy.   We dis­cov­ered that each of us was feel­ing sim­i­lar emo­tions about our cor­po­rate jobs, and both had the desire to do some­thing more ful­fill­ing.  We start­ed with casu­al con­ver­sa­tion, then some spread­sheets, and before long we had a busi­ness plan, lined up some investors, and found our­selves shop­ping for com­mer­cial real estate and fund­ing large enough to open Cincinnati’s pre­mier indoor go kart track.   Our goal was to bring our love of rac­ing to as many peo­ple that want­ed to try it and allow those that want­ed to expe­ri­ence the thrill we both enjoy so much.  We want­ed to do that on our terms — safe­ly, with the high­est qual­i­ty, and with­out any com­pro­mis­es to our core values.

As part­ners of dif­fer­ent ages, we rec­og­nized that life would hap­pen, we would dis­agree on some things, our goals would change as we grew, we would like­ly want to get out of the busines at dif­fer­ent times and above all we want­ed to main­tain our friend­ship.   I was send­ing kids off to col­lege, and he was look­ing for­ward to stop pur­chas­ing dia­pers for his kids.   We estab­lished a strong oper­at­ing agree­ment that was the foun­da­tion of our rela­tion­ship.   This agree­ment, along with open dia­log, and a buy-sell agree­ment that was estab­lished very ear­ly in our incor­po­ra­tion, ensured we had a frame­work for changes in the com­pa­ny.   It also made hard dis­cus­sions easier.

After a few suc­cess­ful and excit­ing years, and a few account­ing firms lat­er – we came upon the team at MACKEY.  We were strug­gling with cash flow, growth, and had trou­ble get­ting our busi­ness finances under con­trol – we had a great top line, decent net income, and yet we felt like we nev­er had any cash at the end of the year.   We need­ed a change, a dif­fer­ent per­spec­tive, a bet­ter finan­cial part­ner.  We need­ed an account­ing and finance team that would actu­al­ly hold us account­able, not just make sure we met our tax lia­bil­i­ty in the most effi­cient man­ner.   Our first year with MACKEY was get­ting our house in order – mak­ing sure our books made sense, mak­ing sure we under­stood and were focused on what the data was telling us.    As we gained con­fi­dence and became more com­fort­able with the num­bers and what they were telling us, we expand­ed the role of the MACKEY team to become more inte­gral in our deci­sion making.

We began uti­liz­ing their frac­tion­al CFO ser­vice called Pros­per for Busi­ness, and start­ed to look at our busi­ness and what we each want­ed out of it dif­fer­ent­ly.   We used the process and the exper­tise brought from the team to set a plan in place to set the com­pa­ny right, cor­rect the issues we were fac­ing – and along the way, we made some dis­cov­er­ies that would ulti­mate­ly lead to us end­ing our part­ner­ship.   That end­ing was most pos­i­tive, in that we each dis­cov­ered what we real­ly want­ed for the com­pa­ny and our per­son­al lives and we remain friends today.   We par­tic­i­pat­ed in some great exer­cis­es, and had thought-pro­vok­ing dis­cus­sions that allowed us to focus on our own def­i­n­i­tion of pros­per­i­ty, where we saw the busi­ness going, and how the busi­ness played an inte­gral role in our long term finan­cial inde­pen­dence.   In a nut­shell – here’s what we learned over the course of a few years:  I was not inter­est­ed in tak­ing addi­tion­al risks – I was OK with the com­pa­ny the size it was, and doing what we were doing and how we were doing it.   My part­ner, how­ev­er, want­ed to grow, acquire, expand our offer­ing into oth­er areas to pro­vide addi­tion­al rev­enue streams, do more for the cus­tomer.   He had visions of 5 loca­tions with expand­ed offer­ings in the next 5 years (we had 2 at this point – due to the acqui­si­tion of a region­al com­peti­tor).   Here’s where things real­ly start­ed to get inter­est­ing for us.

The data col­lect­ed and used dur­ing our pros­per­i­ty for busi­ness told a sto­ry that real­ly sup­port­ed my partner’s plan – we need­ed addi­tion­al rev­enue streams, addi­tion­al attrac­tions, more loca­tions to make the busi­ness reach its poten­tial.   I faced the obvi­ous answers with some trep­i­da­tion – and rec­og­nized that growth and change were crit­i­cal to the long-term suc­cess of the com­pa­ny and the oppor­tu­ni­ty for my part­ner to build some long term wealth.  His sav­ings were cut short by him leav­ing a com­fy cor­po­rate job pri­or to real­ly allow­ing his 401k to flour­ish at the lev­el need­ed for him to retire per­haps decades later.

While all of this was unfold­ing, on a sep­a­rate but cer­tain­ly relat­ed path, my wife and I decid­ed to explore an invi­ta­tion from Mack­ey McNeill to take look at the ser­vices offered by her per­son­al finan­cial man­age­ment firm, The Pros­per­i­ty Peo­ple.    We felt that our cur­rent plan­ner spoke a dif­fer­ent lan­guage, made the task of man­ag­ing our sav­ings for the future some mys­te­ri­ous thing, and didn’t always make us feel com­fort­able.   I had seen some great results from the MACKEY team, and decid­ed it was worth a look; my wife on the oth­er hand had her guard up.   She dis­liked the cur­rent plan­ning process and saw it as a nec­es­sary evil – she was wary that we were step­ping into a sales pitch for more of the same.    After our first meet­ing with Andy, we both had a much more pos­i­tive out­look about the plan­ning process.   We talked about dreams, we talked about life and lifestyle goals, we felt very com­fort­able with that part of the process, and inter­est­ing­ly, we real­ly didn’t talk about mon­ey.    He gave us an overview of the process, had us write down our goals on a lot of top­ics (inde­pen­dent­ly) and col­lect­ed some data.   Our sec­ond meet­ing with Andy start­ed the frame­work of a plan.

We had been in the plan­ning process and learn­ing how to inter­act with the plan for a cou­ple of years when I posed the ques­tion, “When does it make sense for me to look at exit­ing the busi­ness?”  I assumed I was fac­ing years of unwind­ing.  The activ­i­ty on the busi­ness side was well under­way and we had good data at our dis­pos­al that showed cur­rent and poten­tial of the busi­ness.   The MACKEY team and The Pros­per­i­ty Peo­ple talk to each oth­er reg­u­lar­ly, so the com­plete pic­ture was eas­i­ly assembled.

Here’s what Andy’s analy­sis told us: First, my gut feel­ing about not tak­ing any more debt and keep­ing the busi­ness and risk small was the right course of action as it relat­ed to our per­son­al plan.  Our years of 401k con­tri­bu­tions and addi­tion­al invest­ments had grown and posi­tioned us well.   We had achieved our goal of finan­cial inde­pen­dence and tak­ing on more risk at this point in our lives was incon­sis­tent with our plan.  Sec­ond, build­ing an exit plan that allowed my part­ner to assume my shares of the com­pa­ny with pay­ments over time enhanced my plan and allowed my income stream to get reduced in a con­trolled man­ner.  Last­ly, my exit from the busi­ness would allow my part­ner to increase his hold­ings, help reduce the bur­den of cov­er­ing the costs of 2 own­ers’ salaries, and reap the ben­e­fits of the growth that the Pros­per­i­ty Plan for Busi­ness indi­cat­ed was the right course of action.   Andy’s answer to my ques­tion of exit­ing the busi­ness was “as soon as now!”

Now our dis­cus­sions about growth and change had a new ele­ment — a tran­si­tion plan for me and the busi­ness.    After a few days of heart pal­pi­ta­tions, my part­ner real­ized he was ready, and with my involve­ment in a well thought out tran­si­tion plan, and the team at MACKEY by our side, he was up to the task of tak­ing this busi­ness on with­out me.   We worked over the course of the next 9 months to build and exe­cute a plan.  It includ­ed the addi­tion of rev­enue streams and attrac­tions, iden­ti­fy­ing what gaps I would leave unfilled, hir­ing the right peo­ple to fill those gaps – and devel­op­ing met­rics to help show the suc­cess of these moves.

I’m hap­py to report that I have tran­si­tioned into my next chap­ter and so has my part­ner and the busi­ness – I find ful­fill­ment doing some busi­ness coach­ing and men­tor­ing, some vol­un­teer work, spend­ing time with my aging but healthy dad, and see­ing some great sites while trav­el­ling.   My wife has not yet joined me – but our plan tells her she can when she is ready.   She finds a great deal of sat­is­fac­tion in her cur­rent role and has a tran­si­tion plan and time­line in mind already, thanks to the plan we built with Andy.   Oh, and my for­mer part­ner?  He has grown the busi­ness sig­nif­i­cant­ly, added more rev­enue streams and attrac­tions, and is on the hunt for more loca­tions.  He has the folks at MACKEY still by his side, still hold­ing him account­able, still there for him lis­ten­ing, coach­ing, mea­sur­ing, and encouraging.