This is a reality in our industry and knowing the typical issues faced by these people can be helpful to working with them.
I was thinking the other day that I know a lot of people in this business who are business owners when they never planned to be. Yet, they ended up there.
How does this happen? Sometimes people go to work for a firm and through transitions and retirements, minority shareholders end up as the majority owner. In other cases, people lose their jobs and find work as subconsultants, and those engagements turn into a business that grows and eventually has employees. Then they become business owners. Then there are the situations where someone who owns a business dies and either the spouse or one of the kids ends up owning the business.
All of these cases share one commonality: The people who end up with the business never planned to be business owners. That can affect everything they do as owners, and when you are one of these people or work for one, you need to understand some of the common problems of being an “accidental business owner.”
One of those potential problems is a lack of general business knowledge or even interest in the disciplines of “business.” A lack of knowledge can be overcome by getting additional education in business. There are many seminars and courses designed specifically for people in this business that one can take. But there are also programs such as executive MBA programs that are aimed at those who work full time. They can be extremely helpful to people with a technical or design education.
Another issue is that of risk aversion. While I am not one of them, many people feel that owning a business is riskier than self employment. This risk aversion could lead the accidental business owner to avoid making investments in things such as marketing or HR that could impact the growth of the company over time. I’m not sure what the answer is to this problem other than recognizing it could be an issue. If you work with or for one of these people I would be prepared to justify every investment with plenty of data. Industry reports such as those produced by Zweig Group could help there. The important thing is that in general, the accidental business owner may need more information than others before he or she can make a decision.
Also important for the accidental business owner is that he or she needs to have people on their team who are capable at doing the things they aren’t geared to do. Any of their deficiencies in business-related knowledge can be overcome by surrounding themselves with the right people. This includes not only key employees but also the right outside advisors including attorneys and accountants. It also builds the case for having a strong board of directors that includes outsiders who can serve as a sounding board and business mentor for the accidental business owner. These people could be absolutely crucial to their success.
Accidental business ownership is a reality in our industry, just as it is in most others. Knowing the typical issues faced by these people can be helpful to working with them to help them be more successful.
Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.