Crossroad: Should I Abandon My MSc and IB/PE Dreams to Take Over My Dad's $15M Company?
Dad (w/ no education) owns a company worth ~$14-15m and is now looking to sell after two years of burnout. Given his role, selling without a significant discount of 60-70% would be impossible.
Having known the company inside out my entire life, and with a BSc in BA & Finance, should I drop my MSc studies and my dream of breaking into IB/PE in London/NYC to step in as CEO and take over the business or?
Do you want to be a small business owner?
Hmm, good question. I believe the company has significant potential. However, I've always considered it more of a backup plan.
But is it worth giving up my dreams of breaking into IB/PE for the chance at semi-generational wealth?
Is it fair to say this may be a one-time opportunity? That if you don't takeover soon, the company will effectively be gone forever? You won't have an opportunity to take it over?
If so, you are making a long-term decision. Do you want to close this door forever or do you want to take the opportunity? The question is really what work do you like to do? Do you like the finance work that IB/PE provides? Do you like the work your dad does? No one can really tell you what to do. The only good guidance is to make sure you understand what the work is. For a ~$15m company, there should be plenty of money coming in that you'd live a very good life. You'll also probably have better WLB taking over your dad's business so you can actually spend more of that money. But this isn't like giving general IB or PE advice. This isn't like choosing between two different banks or PE or VC as an exit opp. As you are aware, these are two totally different options. Which is best really comes down to you.
Also, would you buy the company from your dad or would he give it to you in a way where you don't have to pay for it/would pay a nominal amount for the business? If he is effectively giving you the business, instead of having you buy it, that's another consideration.
For a little context though, my dream job is basically to be Milken. Dude basically had no administrative responsibilities and got to play in the bond market all day. While my interest is in deal work, not bonds, that sounds great. Being one of the most important finance professionals in the world while having virtually none of the responsibilities that generally come with such importance. And this is entirely ignoring the billions of dollars (in today's money) he received in compensation, as an employee of the bank. My dad is a partner at a small accounting firm (50 accountants). If I wanted to, I could go work there. I could become a partner. I could effectively have the business passed down to me (and the managing partner's two sons). But besides the fact that any accounting work, especially with how type of accounting work sounds absolutely dreadful to me, I'd hate being a partner. All I'd want to do is the accounting work and I'd be stuck having to deal with things like nephews leaving the firm and taking clients with. While I can appreciate what such an opportunity to takeover for your dad is, I am just so jaded by my own observations of running a small business that, while I am glad to try to provide guidance to people like you, I just know with absolute certainty which path I'd choose. I say all this as context just for you to keep in mind.
Thank you. I truly appreciate your input.
As you mentioned, I love the work and opportunities in finance, and I also see the advantages of generational wealth from my dad's company.
Regarding the culture, I enjoy the long hours and the general grind mindset in finance, as well as the constant presence of highly intelligent people. In contrast, my dad's company has more of a 9-to-5 culture, mainly with older men and women.
However, I am unsure if sacrificing my cultural aspirations is worth the financial benefits in the long run.
In terms of transactions, it would likely be a combination of earn-outs, gifts, and other compensations to pay my father back within 10-15 years.
To provide more context, I am only 23 years old, so I'm unsure if I need more experience before considering this possibility.
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