
16/09/2025
The Dos and Don’ts of Succession
PlanningHere’s what BanyanGlobal’s Ben
Francois has to say about ensuring that your
legacy—and your nest egg—continues past your
retirement.
Anyone who’s watched all four seasons of HBO’s
Succession knows that it can be incredibly
complicated—both logistically and emotionally
—to pass along control of a company once the
owner ages out.
Even still, it’s an important process that
many founders must one day confront. The
decision of who to hand the reins over to
could shape their legacy, and their family’s
financial situation, for generations to come,
so it’s not the sort of thing to be deciding
at the last minute.
Ben Francois, managing partner at the family
business advisory firm BanyanGlobal, recently
co-authored a piece in the Harvard Business
Review exploring the different options
available to founders who are departing their
company, from entrusting it to family members,
employees or investors to restructuring it as
a co-op, charity or public company.
Francois recently spoke with Inc. about what
small business owners should be doing to set
the stage for their own succession—even if
they’re not planning to retire for many, many
years.
Why is succession such a hard decision for
founders, practically as well as emotionally,
and how have you seen them wrangling with such
a pivotal decision?
The reason it’s hard is that no one’s ever
been in that position before, so even in a
family business, you’re only the senior
generation once; you’re only the junior
generation once. And when you’re that senior
generation, you may or may not have a model of
what succession looks like, but you’re really
figuring it out on the fly. And as a founder
in particular, it’s a very lonely spot, so you
don’t really have anyone to talk to about it,
and you’re really trying to figure something
out that has implications that are pretty far
down the road. What you’re focused on is your
business. There’s a big part of founders that
really identify as a founder, and so thinking
about a life where that is no longer true is a
real challenge.
How do you see founders wrangling with that?
There’s two main pathways. There’s the group
that is really clear on where they want to
go–whether that’s a family business or a
transition into a nonprofit similar to the
Patagonia model—and when you have that
clarity, you’ve worked through the emotions.
You’ve worked through what you want your
legacy to be. The other group, frankly,
ignores it, and it just doesn’t come up. I
think there’s a belief that they’re keeping
their options open, but I think what really is
happening is, when you’re not thinking about
it, it becomes really challenging to plot a
course to what you want.
What are some of the mistakes you see founders
make when they’re going through this process?
If you don’t plan well, what happens is you’ve
limited your choices. The choice will be made,
whether you make it or you don’t. So this is
like a Charlie Munger inversion problem: ‘If I
don’t want to have a successful outcome, what
would I do?’ You would say, ‘I’m going to not
make any decisions, and at the end, whatever
the path of least resistance is for my heirs—
or whoever’s going to get this business—is
what’s going to happen.’ So the big mistake is
that lack of intentionality.
The inverse of that question is, what can
founders do years ahead of time—when they’re
not actively thinking about succession—to set
themselves up for a successful transition down
the line?
What I see work out in the wild is really
thinking through those legacy questions of
what you want, and revisiting them on a fairly
frequent basis. The reality is, what you want
when you’re 40 might look really different
when you’re 60 and you have grandkids. Your
perspective will change, and so revisiting
that. But one thing to think about is, how do
you keep more options open? If you’re not
totally sure where you want to go, how do you
start taking the steps that will allow you to
have some optionality, so that when you do
decide, it’s not too late to go down a path
you want?
How has private equity opened up new
considerations for succession planning?
It used to be that a private equity firm was
going to buy 80 percent to 100 percent of your
business. They were going to lever it up; you
no longer were the control person. If you
retained 20 percent, it was really so you
could get a second bite of the apple when they
resold the business. But private equity has
shifted a bit to have longer fund life, and
even in some cases, in perpetuity. And related
would be these huge, multibillion-dollar
family offices operating as private equity
funds and providing capital to help with
generational transitions sometimes. You might
have capital that comes in as a minority
shareholder, which was not really a thing;
there were very few firms that were doing
that. That’s a bit more common now. There are
firms out there that will buy 40 percent of
the business and not put any more debt on it,
and that capital may stay in for 15 or 20
years—or forever.
Another dynamic is the silver tsunami of
Boomer founders reaching retirement age. What
does that look like, and how does that inform
the dynamics here?
Back to private equity, we’re seeing this on
the small business front. You’ve seen private
equity go into all these HVAC businesses: it
used to be, if you had a small business like
that, you probably just wound it down when you
were ready to retire. Now you can capture this
multiple that you’d never thought was going to
be possible. Given what’s happened in private
equity, given what’s happened in the world of
search funds, there’s more and more exit
opportunities for small businesses—and there
should be, given the fact that there’s going
to be many more small businesses where you
have founders who are reaching retirement age,
and they may feel like they have a choice now
where before they didn’t. Now they can sell to
somebody, or they can say, ‘Wait, there’s a
lot of value here. I’m going to do something
else and pass this business down to my
employees or my partners or something else.’
This is something that is happening at a rate
much higher than has happened in the past.
Is there any additional advice you would share
with small-business owners about how they
should be approaching succession?
This is going to sound so trite, but I would
say, be open minded. One of the things that
gets celebrated in the world is, ‘I built this
company and sold it for a pot of money’—but
instead of just defaulting to that, think
about, ‘Hey, what am I really trying to do
here? What would my life look like if I
actually had this pot of money?’ That idea of
open-mindedness and not rigidly defaulting to
one pathway up front, during that exploration
phase, is the most important thing.