Owner to Owner: Real Stories of Succession

March 30, 2022
Throughout the first quarter 2022 issue of Owner to Owner, we brought you stories of succession from real businesses. Here they are.

In the first quarter 2019 issue of Owner to Owner, we sat down with Ward and Nico Landrigan, the father-son duo behind fine jewelry lines Verdura and Belperron, to discuss Ward’s acquisitions of the two brands, Nico’s decision to join the family business and their approach to handling communication. As follows is an excerpt from our discussion.

Tell us about your decision to join the family business. Did you always plan to follow in your father’s footsteps?

Nico Landrigan: For a long time, I didn’t think I was going to. The idea first came about when I was studying abroad in Australia during college, and my dad and I took a fishing trip in New Zealand together during my spring break. There were many long car rides where we talked about life, and at one point my dad said he was thinking of selling Verdura and doing something else. That was a trigger for me to really think about whether the business would always be here. I knew I cared about it and that it was the family business, but when you’re young, you’re so disconnected from what that even means. After my dad brought up the idea of selling, I sat there thinking about it for a while, and I came back with, “What if one day I join you in the business?” That was the beginning of the conversation.

I worked outside the company for a little after graduating from Brown University and eventually joined in 2004. The idea was that I would learn the family business, and then we would relaunch Belperron. We didn’t launch until 2015, but there were many advantages to waiting. I gained a lot of experience in manufacturing jewelry. When sitting with these craftsmen who have learned from generations of apprenticeships, you’re dealing with thousands of years of accumulated artisanal skill in rendering pieces beautifully, securely, safely and durably. Working with these people is my favorite part of the business.

In our second quarter 2021 issue of Owner to Owner, we spoke to Victoria Mars about her family, her business and her philanthropy. Following is an excerpt from that conversation.

Tell us about how you have successfully navigated a career in the family business.

My father and uncle believed very strongly that, as a family member, you started at the entry level, so I joined the firm as an assistant brand manager, and then I evolved over time, moving to new job opportunities throughout the firm as they opened up.

Mars is the only company I have ever worked for, and that’s not necessarily a good thing in a family business. Now, we encourage family members to get outside experience first. One of the difficult aspects of being a family member in a family business is that you often wonder whether you are doing a good job and receiving true evaluations of your performance. That can hurt your self-esteem. Being able to say you were successful somewhere else first helps you understand your strengths and capabilities and be more confident in your success within the family business.

The other challenge in a family business is the discovery and then acknowledgment of who you are in that family business. My father and uncle always taught us that we were just like everybody else. We didn’t have any special privileges and were expected to blend in. But as I started to gain seniority (about my mid-30s), I realized suddenly this was no longer the case. As much as most wanted to treat me that way, I knew I was being watched more carefully and that what I said and did mattered. You need to be conscious of your actions – both in and out of the office. For example, you don’t want to give the impression that you have favorites among the associates. When I came to this realization, it was a sad moment. I had to temporarily (until either they or I retired) create some distance in my friendships with colleagues. I found this to be challenging and isolating.

One final point: We realize that if family members are going to work for the family business, then the end objective is for them to be successful. The worst possible outcome is for a family member to work in the family business and fail, because that causes all kinds of problems. We are focused on developing a family employment system for the next generation so that if they do join the business, we are setting them up to succeed.

In the second quarter 2017 issue of Owner to Owner, we sat down with Keith Campbell to discuss the Mannington Mills’ approach to succession planning, hiring non-family executives, the importance of having stated values and a mission and the benefits of a family council. As follows is an excerpt from our discussion.

Did you get the sense that your father, the third generation, was grooming you for the fourth generation of leadership?

Yes, but my dad always told me that if I didn’t like it, I could leave. There was a high expectation for me to fill in, but I never felt I was being forced into it, because I loved it. I have never regretted taking on this role. I’ve enjoyed it, and the people I work with make it the most special.

My father and other people in leadership definitely had succession planning on their minds, but it was not as refined compared with our planning efforts for our fifth generation. However, when looking at succession planning, you have to keep in mind that all family businesses are different. The family dynamics are different; the capital structure is different. I often read that most family-owned businesses fail in the third generation. Here, the third generation transformed the company and was the catalyst that led us to become a worldwide leader in the flooring industry. The fourth generation has also built on that success and taken Mannington to even greater heights.

How have you approached succession planning with the fifth generation at Mannington?

One of the biggest things I stress to this next generation is that you must have the highest level of passion – that’s irreplaceable. If you’re not passionate about the family business, you don’t need to be involved, because as family members, you’re responsible for everything. People look at your level of passion, and you have to wear it on your sleeve.

We encourage all of our family members to do summer internships at the company. Most of them work in manufacturing to understand what it entails, and they also learn about the responsibilities the family has as owners.

I did not want this company to become a safe landing spot for family members getting out of college, so we put in a rule that family members must meet certain criteria to be hired. First, they have to be over 30 years old. Second, they must have a post-graduate degree that’s applicable to the business. Third, we need to have an open position for them. The last thing is that they are like any other employee – if they don’t perform well, they can be asked to leave.

We now have three fifth-generation family members working here. During their careers, we will purposely put them in areas they know nothing about. This is to turn them into what I call a Swiss Army Knife – understanding all of the different parts of the business. They’re not expected to be experts in everything, but they better know the areas.

We have communicated our succession plan internally, but the issue is that you never have all of the answers. You may have a successor, but what if something happens to him or her? As soon as you think you have it figured out, something happens.

In 1992, brothers Travis and Dane Boersma decided to go into business together selling espresso from a pushcart in downtown Grants Pass, Oregon. Thanks to a commitment to the best customer service above all else and a lot of good music along the way, Dutch Bros Coffee has since expanded from that one pushcart to more than 538 drive-through coffee locations in 12 states at the end of 2021. In 2018, the company took on a private equity partner, and in 2021, it had an initial public offering (IPO) on the New York Stock Exchange.

Kathryn George, who oversees the BBH Center for Family Business and is also a director on the board of Dutch Bros, recently spoke with Travis about maintaining the company’s customer-driven culture as the company grew and his approach to succession planning now that the company is public.

You have had quite the journey over the past three years as you went from being 100% family-owned to taking in a minority private equity partner in 2018 to going public in 2021. How have you been able to preserve the company’s culture through all this change?

Everything we do is with our people in mind – even going public. We did the IPO to create more opportunities for our broistas, and our growth is predicated on our people pipeline. By looking at everything through a people-first lens, we're able to stay true to ourselves and our culture.

How do you think of succession differently now that Dutch Bros is a public company?

The process may look a little different, but the intention isn't. Regardless of our status as a public company, Dutch Bros has always looked for leaders that understand our unique culture and how to scale it. If anything, finding that fit is more important than ever. Dutch Bros is a rad place to be, and it needs to stay that way while maintaining our growth trajectory and meeting the expectations of all our stakeholders – broistas and customers, included.

Read our first quarter 2018 conversation with Travis Boersma here.

Juggling Competing Priorities as a Private Business Owner
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Owner to Owner Q2 2021

Owner to Owner examines issues around growth, liquidity and control in private business ownership, speaks with a 110-year-old family business and examines lessons for the intersection of business, personal values and philanthropy.

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