Tom Deans: Beyond Q&A

Tom Deans, New York Times best-selling author and award-winning speaker, talks to pePartners’ Annie Hartnett about his life’s work, the wisdom of his forefathers,  The Godfather, and what business owners should consider as we move into 2017.

I listened to the introductory podcast  for you book, Every Family’s Business, and I was intrigued! So, my first question is: What do you consider to be your life’s work?

That’s a great question! I think the things that I will be remembered for are my books. I had the great privilege of being invited to join my family business and then working shoulder-to-shoulder with my father in the business that he founded. And then to be given a really rare wisdom that I acted on and wrote about and spoke about—and continue to speak about. That book, Every Family’s Business, was written almost a decade ago and it continues to sell extraordinarily well globally—almost a million copies to date. And I continue to do about fifty speaking events a year all around the world based on that book.

I do another fifty on the second book Willing Wisdom. It’s a very different book. It’s contrarian, for sure! But there was a real sense of purpose in writing that book.  I think when my time is done and I look back, I will look at this chapter of my professional career as being the most interesting and dynamic.

Do you also do one-on-one consultations?

I don’t. And I think that’s what makes my business and my speaking unique! That really frees me to be quite direct with my audiences. I don’t use my speaking events to troll my audience for consulting work. Consequently, the message is poignant and based on something I lived. Both my books and my speeches feature questions. I have very few answers for my readers and audiences, but I do have some phenomenal questions that really provoke people to start conversations with the people who matter most—their family members—to figure out how they are going to exit their business or transition their personal wealth.

I believe that silence is the great destroyer of wealth; it’s the great destroyer of family relationships. And my books are designed to start conversations. That’s it!

Is there ONE question that is the most important question that owners should ask?

Absolutely—that’s a no-brainer. Its question #3: Are you prepared to risk your capital with the view of acquiring control? Yes or no? There’s so much equivocation around that question. It’s the elephant in the room! There are business owners who think their kids are going to buy the business at market value, and there are kids who think their parents are going to give it to them for free. And no one knows how to start the conversation, and so what happens? I’ll give you a clue…. That’s right. Nothing!

That was about a five second pause. Try a ten year pause. It is the silence that destroys the relationships—and the wealth.

And the change that we’re seeing now is that business owners are living a long time—much longer than their parents.  We have business owners living well into their nineties with “kids” in their sixties wondering when in the hell the shares are going to transfer!

Only 30% of family businesses survive to the next generation and only 10% make it to the third generation. So the founders who read your article should be reminded that there is only a 3% chance of their grandchildren owning and operating the family business. They don’t need to go to Vegas. They just need to go to their office—because that’s the biggest casino in the world. They’re gambling with their largest asset—with no plan.  Business owners will turn to their accountant or lawyer or another trusted advisor, and they’re often getting biased advice.

The image that comes to mind is from the movie The Godfather. You have this strong figure, and he passes the family business on to his sons and it keeps getting weaker and weaker.

I actually used the phrase in my book, Every Family’s Business: “Family businesses are like the mafia; they only kill their own.”

Did you come by this wisdom through difficult personal experience?

You know, I have done hundreds of television and radio interviews, and no one has ever asked me that! Actually, here’s where my wisdom comes from: I had a great-grandfather who had a tire distribution company on the east coast, and that business got sold in the 40s and my grandfather took his inheritance and he started a chemical manufacturing business. That business ultimately got sold, and my father started a plastics manufacturing business in the early 1970s. That’s the business that I joined. That’s the business that we sold. Do you see a pattern in our family?

We start businesses; we run them; we sell them.We pass along wealth; we don’t pass along operating businesses.

So to answer your question: I was a voracious reader but I could never find a book that resonated with my story. All the literature said was “You’re a failed family business.” So if you can’t find a book that captures your own story, what do you do? You write one!

So, you’re passing along the wisdom of your forefathers!

Absolutely. That was the real gift. My father didn’t give me the family business. He gave me something way more valuable financially—he gave me this wisdom that I’ve turned into this phenomenal business! I’m selling a powerful idea that is rarely heard!

I just have one more question. We looked into the past and now I want to look into the future. I’m predicting that there is going to be a lot of change in 2017.  What will that mean for owners looking to exit this year?

Well, I think there is always a lot of change, but I share your sense of an accelerated pace of change. This will be the year that business owners understand that continuing to invest in their business and to hoard their wealth in one asset—their business—is in complete violation of the first rule of sound financial planning. I think 2017 will be the year that business owners become aware that selling is not a failure. It’s what smart entrepreneurs do! I see 2017 being a real shift culturally in what exit planning means—moving the public discourse from being the vanquished to being the victor!

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