Decades ago, an entrepreneur didn”™t have to look far to find a partner. Brothers and sisters ”“ who had their own children in tow ”“ were ready to jump in.
What happens when that second generation starts looking among its own offspring to see where the future of the company will head? That was the topic of discussion at KeyBank”™s recent roundtable in West Nyack.
Sixty years ago, Peter Gisondi and his siblings started a painting business, which meant their own children were guaranteed regular summer employment. Six decades later, oldest son John is president and CEO of Peter Gisondi & Co. The White Plains union shop employs 100 people. Among them are the grandchildren of the founder.
“Some industries will always require a human being to perform the work ”“ painting is one of them ”“ and that, too, has become very high-tech. Because my brothers and I own the business doesn”™t necessarily mean our children are going to continue in it. … times are changing … and there are options out there that were not there for my father and his siblings when he began the business.”
In James Hayden”™s case, he is an honorary member of the Schoenberg family, whose salt distribution business was born in 1898. Hayden joined Schoenberg Salt Co. in 1978 as a dispatcher and appointed company president two decades later by the founder”™s son, Ira.
“I never thought I”™d have a chance to show this to anyone,” laughed Hayden, displaying a plaque formally declaring him an adopted son of the Schoenbergs. “For a family-owned business, putting an ”˜outsider”™ in charge is a very big step. I feel very fortunate they put their trust in me to grow the company.”
Jason Lieberman joined DEC Office Solutions that his co-father founded, one of Rockland”™s largest copy machine and document management systems. Jason has two sons but is not sure whether either will be interested in continuing DEC once they”™ve gone out into the world of business.
“Two thousand and eight definitely affected everyone; family-owned businesses were no exception. Many who thought they would have a lifetime job or a legacy to pass on to their children were jolted. Some just closed up and disappeared overnight. That has made many coming up the ranks think twice about choosing the family business as the natural career step for them.”
In Vaughan Miles”™ case, he migrated to the U.S. to join his own son”™s company, Infora L.L.C. Many of its innovative products have been touted by Dr. Mehmet Oz, The Wall Street Journal and the “Today” show.
“My son has two children, but I don”™t know if either is going to follow in dad”™s footsteps,” Miles said. “We are unique in what we produce, but many want to follow their own dreams, not pick up where mom or dad left off.”
Mike Wolfert took his love of climbing so literally he brought it indoors for all to enjoy, opening The Cliffs at Valhalla in 2005. The 13,000-square-foot climbing park has been a success, despite the recession.
Wolfert, with two small children, is not thinking about a succession plan ”“he”™s just focusing on the continued success of his company. “I”™m not up to thinking about leaving my business to my children,” said the young entrepreneur, “but I do see many in my age group looking at other professions outside of their parents”™ business. And I also see many parents discouraging their children from picking up the business when they are ready to retire. There”™s a whole new dynamic in business today for younger people.”
Another roundtable participant, Ellen Diane Rivera, is not a business owner but has been executive director of West Street Child-Care Learning Center in Spring Valley for several years””and is looking for a successor. She was grooming her daughter to take over the early learning center, “but she decided she wanted to do something else,” said Rivera. “It”™s very tough to get people interested in taking over a nonprofit in an underserved area. They have to want the job because they love the mission, not for the paycheck.”
Though each had different business models, they all had two things in common: a need to keep their business in the black and the need to have a line of credit readily available to make sure there”™s no shortage of cash available for payroll, shipping goods and buying inventory.
“Banks have been tightening their lending requirements; the need to have a good business relationship with your banker is essential,” said the roundtable participants. “In order to keep that relationship positive, your financial strategy and business plans must be solid and well thought out,” Gisondi said. “It”™s very daunting to today”™s generation, particularly since they”™ve seen what”™s happened in the recession. We all hope to see our companies continue.”
