Ask an Expert: Passing Your Business On To Your Kids

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Working Past Retirement

Q: Steve – Have you had any experience with businesspeople who want to hand their business down to their children? We are having a difficult time trying to figure out how to make it work. Thanks. — Renee

A: Building a multigenerational business is no easy task, that’s for sure. To create a such a business means that not only must you create something that people like (and keep on liking), but you must also figure out how to keep it in the family.

Nope, not easy.

Indeed, while I have seen many family businesses that have been unable to either stay up with the times or be able to successfully bring in the next generation, I can think of really only one that got the multigenerational business formula right.

The Bar 717 Ranch is located in the idyllic far northern reaches of California in the Trinity forest. The ranch is also a much-loved summer camp known as Camp Trinity. Run by the same Gates family since 1930, this summer marks the camp’s 85th anniversary and it’s going as strong as ever.

How does a business stay in business 85 years? How does it stay in the same family for so long? And what does it take for a place like a summer camp to be so beloved that parents send their kids there and their kids send their kids there?

I was a counselor at the ranch throughout my college years and can attest to the fact that it is a magical place. (Yes, I sent my kids there too.) But there are lots of summer camps that kids love that have come and gone. What does the Gates family know about creating a multigenerational business that they can teach the rest of us?

To answer that, I recently sat down with one of the co-directors of the ranch, Kent Collard. Kent is the grandson of the founder of the camp (and still the guiding light), Grover Gates. Kent says that one of the keys to the longevity of their business is that they have been able to balance stability and tradition with the need to adapt and change with the times.

“My grandfather Grover started the camp with some very specific goals and values in mind,” Kent told me, “and keeping those going has been important because it helps connect people to this place.” For example, Grover was a schoolteacher / athletics coach and decided from the get-go that his camp would not have any competitive sports, that it would stress cooperation over competition. That is still true to this day and it’s one reason why parents still send their kids there.

Other values that the camp stresses that still resonate are

  • A strong sense of community
  • Freedom – the ranch is a safe place for kids to roam
  • Sustainability

That last point is important and needs to be underscored. The Gates’ ranch has always stressed sustainability, but these days it is a value that has become very important to many people. As such, it is something that the camp emphasizes in its marketing efforts now.

And that is the other thing that the Bar 717 has done right over the years that has allowed it to keep on going – it adapts. “For instance,” Kent told me, “when you worked here Steve, we had two month-long sessions, July and August. For the most part, people don’t want to send their kids away for a month these days, so now we have two week sessions, and even experimented with week long sessions.”

So, balancing tradition with adaptability is essential for the long-term.

But what about that other part of creating a generational business – the passing it on to the next generation? Kent Collard says that that really is the tricky part, those transition eras. Kent himself went to Harvard Architecture School and never envisioned himself running his grandfather’s business. But here he is. “It grew on me,” he says.

Kent also shared that until a family member or members is ready to take it on, it is critical to bring in outside people who really understand and appreciate the business. For his family, it wasn’t that difficult because there are a lot of people who feel a deep connection to the place (like, for instance, his co-drector Laura Higley who has been at the ranch every summer since she was four). For the regular small business however, Kent suggests that the key is to find people who appreciate the history and tradition of the business and buy into the values that have kept it going for so long.

Not bad advice, not at all. Follow it, and maybe your business will be around for the next century or so too.