Dubai: 'Business Succession' - Challenges and Rewards
Media Release
Dubai, Dec 13: "All businesses are passed-on or pass-away” – Remarked Ivan Fernandes during his talk on Why, When and How to Exit a Business.
Kanara Entrepreneurs Ltd. (KEL) held an interactive workshop to discuss challenges versus rewards in inheriting family owned business at the India Club on 12th December, 2009. The event was well attended by its members and non members with their spouses and children who aspire to join their family businesses. The need of this workshop was felt as most of the family owned businesses seldom survive through the second generation, some are very successful and hence the need to discuss views presented by the second generation or youngsters.
Michael D’Souza, Lead Member and Director of Mentoring of KEL gave an overview of the need for succession planning and encouraged to open up to reality. With his track record of creating and managing various business ventures in India and in the Middle East he prompted attendees to be proactive and open with their views.
Rochelle Lobo, a young and dynamic general manager of a group of furnished apartments in Dubai came across as a successful budding entrepreneur. She shared her experience and challenges whilst growing up working under her father and during her short stint outside of the family catapulting her gradual rise to her current position. This was followed by another youngster, Clinton Mendonca, shared his experience and challenges of bringing changes into an established family business. Lavita Rasquinha, a senior manager with a multinational organisation presented her views on succession and why she preferred to be a working professional as against joining her father’s business. She said she wanted to create her own identity and bench mark her potential in terms of remuneration and it is up to any business including her father to utilize her skills, recognise and remunerate her for what she is worth. Fevin Mascarenhas, a part time student and working in Australia said he wants to be independent and having known the systems and conditions in Australia prefers to continue there in pursuing his own passion totally different from his father’s business. He emphasized on individual choices one has to make.
Dorothy Fernandes, one of the lead members of KEL brought a different dimension to the discussions about spouse complementing the family owned business. Dorothy, who used to work for the government in Oman shared her experience and challenges of joining her husband’s business and provided insight into the compromises and challenges of balancing family and business. Dorothy said with all the initial apprehensions she never looked back since joining the business her husband was running by sharing responsibilities and maintaining adequate space between her work and family.
During the group discussions, the audience had something or other to share, which served to bridge the generation gap between parents and aspiring children who are contemplating in taking over their family owned business.
Ivan Fernandes, Chairman of KE Global and veteran of successfully establishing and exiting from many business ventures provided valuable pointers on why, when and how one can exit from their business. He gave several insights on why an entrepreneur needs to look for exit, including succession, issues with business partners, serious debt, threat from bigger players and the business no longer being challenging to the entrepreneur. On the point of selling the business, Ivan clearly mentioned that while many entrepreneurs look at exit as a last resort, the best time to sell your business is when you don’t need to i.e. when the business is doing fine and generating the returns that you expected. This is because that is the time when a buyer will find it lucrative and give you the best valuation. He cited some examples on the timing of the exits and how it can impact the entrepreneur from a financial standpoint. Ivan talked about the various business valuations in the market place for different types of businesses and how they ultimately boil down to the rule of thumb valuations. He described how an entrepreneur should plan his exit well in advance and build his company by increasing its value through various parameters such as a strong brand, professionals running the company, building strong barriers to entry for competition, customer diversity and so on. His case studies and general yard sticks and thumb rules kept the attendees spell bound and had food for thought.
Albert Rodrigues, President of KEL in his closing remarks said the discussions were fruitful in bridging the gap and getting youngsters to speak up. He said the workshop was different and as organisers, KEL was satisfied with its outcome as it is a step in the right direction to encourage entrepreneurship by pursuing passion while creating and preserving wealth. He thanked all those who attended and presented their views. Albert requested the attendees to provide their feedback and suggestions on topics they wish to attend either through the members of KEL or through the electronic media.
Alfred Vaz, Events Director of KEL moderated the session.
Overall the event was well organised and well received starting and closing as scheduled followed by networking over dinner. Attendees were overwhelmed with the concept and requested organisers to have similar events in the future.
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