The Richter Family Advisory Series: Navigating Ownership After Loss
“When our dad passed away, my sister and I became equal owners of the business our father had created. We each have different visions for its future, and I’m unsure if we can agree on the next steps. How do we move forward?”
The passing of parents can create profound challenges, particularly in a family business. Siblings who inherit an enterprise this way frequently grapple not only with their grief but also with differing ideas about managing the business. This was the case for a brother and sister who turned to us for guidance in navigating their complex situation.
THE CHALLENGE
After their father’s passing, the siblings faced the daunting task of running the family business together. Although both felt deeply connected to the enterprise, their visions for its future differed significantly. As tension grew, they struggled to find common ground and began drifting apart, both as business partners and siblings. The company’s employees and clients became increasingly confused about its direction and leadership.
Recognizing the need for constructive dialogue, the siblings sought guidance to facilitate discussions and address their differing views to chart a path forward. However, they felt unsure about how to proceed without escalating the existing conflict.
THE RICHTER SOLUTION
To help the siblings navigate their relationship and business roles, we began with a series of one-on-one discussions to understand the context of their situation and sibling dynamic. These sessions allowed each of them to express their vision for the business, as well as concerns and aspirations in working together. Understanding these perspectives laid the groundwork for productive joint meetings.
Our facilitated process included the following steps:
- Facilitated discussions: Conducted one-on-one and joint meetings to encourage constructive dialogue and mutual understanding.
- Business partnership evaluation: Together, the siblings concluded that business partnership would not support their long-term relationship.
- Transition planning priorities: Defined shared priorities for a transition plan that aligned with both siblings’ interests.
- Thorough business valuation: Conducted a comprehensive business valuation process including the allocation of value between the siblings, respecting the wishes of their late father.
- Agreement on business division: Negotiated an agreed upon split that would achieve both stability for the business and provide an acceptable outcome for both siblings.
- Tax planning strategies: Developed commercial and personal tax planning strategies to optimize and protect their collective financial interests.
The entire collaborative process was facilitated with a continued focus on open and transparent communication. This not only achieved a smoother transition in ownership but also preserved their family relationship. By leveraging the expertise of Richter’s family office and business advisors, the siblings were able to navigate a challenging situation with clarity and fairness, focusing on what mattered most to them.