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A business owner navigated multiple exit paths before choosing a successor-led buyout that aligned with his personal goals, financial security, and legacy priorities. With structured high net worth financial planning and outside capital support, he exited confidently while empowering key employees to carry the business forward.
Mr. McAfee came to Legacy & Succession seeking guidance on how to exit his company. Before formally engaging, he attended one of our Breakfasts for Business Owners, which prompted deeper conversations about his goals. While he understood there were multiple exit options available, he was unsure which path best aligned with his personal, financial, and business circumstances. David and Madison initially met with Mr. McAfee and his spouse to explore potential strategies. An ESOP was evaluated but ultimately ruled out due to the company’s size. The conversation then shifted to a Key SOp, during which David and Madison met individually with three key employees to assess interest and alignment. All three expressed strong interest in purchasing the company together, as their complementary skill sets positioned them well to operate it jointly. However, they were not financially prepared to acquire an eight-figure business, and Mr. McAfee was understandably concerned about carrying a large seller’s note.
To address these challenges, the Chaneys introduced Mr. and Mrs. McAfee to David Ortiz, an exit strategy expert on the Legacy & Succession team. Ortiz worked with the owners and key employees through the “three legs of the stool” approach to exit planning: Personal Goal Planning, Personal Financial Planning, and Business Planning. The team clarified Mr. McAfee’s motivations for selling and built a comprehensive financial plan to ensure the transaction supported his long-term wealth and legacy goals. Throughout the process, the primary successor was engaged in monthly meetings to prepare for the leadership transition. The team identified and prioritized business risks, created a transition game plan, and conducted targeted exercises and strategy sessions to ensure the successor was both capable and confident. To further reduce risk for the owner, Legacy & Succession provided access to private capital to supplement the SBA loan, eliminating the need for Mr. McAfee to carry a significant seller’s note. Without this capital solution, the transaction would not have been feasible.
Ultimately, the outcome reflected the power of putting the three legs of the stool in the proper order. Rather than starting with business planning alone, the process was guided first by personal goals, which served as the wind directing the sailboat, with the business acting as the vessel to reach that destination. Although Mr. McAfee could have sold to a third party for slightly more money, he had already achieved sufficient wealth to meet his retirement and legacy objectives. Instead, he chose to reward the key employees who helped build the company and were effectively already running it. He exited with confidence, knowing the business would continue to thrive and create generational wealth opportunities for the next generation of employee-owners.
L&S Private Wealth, LLC (“L&S”) is an SEC registered investment adviser. Registration with the SEC does not imply a certain level of skill or expertise. This communication is for informational purposes only, and is not intended to provide specific investment, legal, tax, or other professional advice. The case studies presented are designed to illustrate L&S's approach to specific client situations. The client(s) for whom the case studies apply have not endorsed or otherwise provided testimonials for the firm or its staff. The case studies are based on specific client situations which may not apply to your particular situation. Please consult with an L&S professional for guidance. Information regarding L&S’s services, fees, conflicts of interest and related matters can be found by clicking the following link https://adviserinfo.sec.gov/firm/summary/339946 and viewing the latest Form ADV, Part 2 Brochure and Part 3 Relationship Summary.
Testimonials are based on unique experiences from current clients and are not representative of all client experiences. Testimonials are solicited, and no cash or non-cash compensation was paid for such testimonials. Not all clients were solicited to provide all testimonials. No client or potential client should assume that any information presented or made available in this video should be construed as personalized financial planning or investment advice. Personalized financial planning and investment advice can only be rendered after engagement of the firm for services, execution of the required documentation, and receipt of required disclosures. Please contact the firm for further information. Investing involves risk, including the possible loss of principal and fluctuation of value. Past performance is no guarantee of future results.
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