1. “State of Owner
Readiness”©
2016 Updated Survey Results
Patrick C. O’Brien MBA, CEPA
PNC Wealth Management
EPI National Advisory Board
© 2013 Exit Planning Institute

2. Stakes are Enormous
“Age Wave”
 First boomers turned 65 in 2011;
10,000 turn 65 everyday; the
youngest are now 51. Average 60.
 Own 63% of the private businesses
in U.S.
 80-90% of their wealth is tied up in
their businesses
 EPI recent survey confirms: 76% plan
to transition over the next 10 years;
48% in the next 5 years
Represents a transfer of 4,500,000businesses and over
$10 trillion of wealth

3. Historical Success Rates
 12 months after selling, 3 out of 4 business owners
surveyed “profoundly regretted” the decision.
 70-80% of private businesses put on the market don’t
sell.
 Only 30% of all family-owned businesses survive into
the second generation; 12% survive into the third
generation; and only 3% operate at the fourth
generation and beyond

4. 3.0%
24.0%
40.0%
27.0%
7.0%
What is your current age?
< 40
40 - 49
50 - 59
60 - 69
> 70

5. 75%
12%
5%
3%
5%
What is your company's annual
revenue?
< $5M
$5M to $25M
$25M to $50M
$50M to $100M
> $100M

6. 85%
12%
3%
If family owned, how long has your
company been owned by the family?
1 Generation
2 Generations
3+ Generations

7. Retail,
Wholesale
trade or
distribution
Energy
Business/Professional
Services
Technolog
y/Comm…
Transportation
Manufacturing
Healthcare
Real Estate
Insurance/Fina…
Other
What industry are you in?

8. 15%
85%
Do you have an engaged Board of
Directors/Advisors?
Yes No

9. 24%
44%
32%
Are you familiar with all of your transition
options?
Yes No Not sure

10. 5%
88%
7%
Have you established a formal
transition advisory team?
Yes No My Board

11. 14%
86%
Have you completed any formal education
related to transitioning your business?
Yes No

12. 22%
1%
3%
3%
12%
1%
3%
50%
5%
What best describes how you are
planning on transitioning?
Internally (family
succession)
Internally (ESOP)
Internally
(Management)
Internally (Partners)
Externally (3rd
Party/Strat/PE)
Externally (Recap)
Externally (Orderly
Liqu)
Not sure
Other

13. Which describes your post transition
“life after the business” plan?
0.00% 10.00% 20.00% 30.00% 40.00% 50.00%
Written Plan
Informal plan
Idea
No thoughts

14. 33%
67%
Do you have provisions in place if key personnel
or shareholders should get ill, die or otherwise
exit the company?
Yes No

15. Challenge #1
50% of exits are not voluntary
Death
Disability
Divorce
Distress
Disagreement