Fast-growing private companies are exciting to observe as outsiders, but on the inside the company founder has the challenge of securing enough capital to fuel the rapid growth of the business. The company’s continuous need for capital places the founder in the position of having to manage the company’s operations while at the same time
Private company investing is inherently risky, but these risks can be mitigated if investors take proactive steps before making this type of investment. This due diligence action plan for potential investors includes the following specific steps: (1) identifying whether key factors are present in the businesses that mark it for success, (2) evaluating the current
Conflicts between co-owners in private companies are common, but the vast majority are worked out through dialogue and negotiation. When these internal conflicts cannot be resolved, however, minority investors may file suit against the company’s majority owner. Anecdotally, these investor claims seem to be on the rise, including claims that the majority owner breached fiduciary
When divorcing couples hold ownership interests in private companies as part of their marital estate, they will have to address a number of business issues related to these interests in their divorce settlement. Planning ahead to address these issues may help to avoid surprises and also lead to a less contentious discussion of their settlement
Hindsight can be a wonderful thing, especially if hard-earned lessons are adopted by others who are willing to learn from past mistakes. When private company owners and investors share with me some of the wisdom they have gained from their past dealings with business partners, they often cite the same three mistakes they made in
As a business trial lawyer representing private company owners and investors in business divorce disputes and civil litigation for many years, my experience teaches that business partners should approach litigation with caution. Specifically, and for the reasons discussed in this post, I would advise business partners to sue their business partners only when it is
Business owners of private companies invest huge amounts of time and resources in their business, which may include the bulk of their financial capital. For owners who do not want most of their net worth to remain tied up in the business, there are options available that would allow them to take some of their
“If you don’t know where you’re going, any road will take you there.”
— From Alice’s conversation with Cheshire Cat from Lewis Carroll’s Alice in Wonderland
For business owners intently focused on growing their private companies, it may seem like a waste of time for them to answer how they define success. They may even view
After devoting long hours and years of hard work in building their companies, majority owners of private businesses may reach a point where they consider whether it is time for them to sell. This large question – Is now the time for you to sell your business? – will depend on the answers to some
Private company owners strive for success but getting there is not an easy or straight path. I have been working closely with business owners now for more than 40 years, and I have been reflecting on the key character traits shared by successful entrepreneurs. These views are not based on peer-reviewed research but are gleaned
