11 Good Reasons Why Introducing a GM with Equity Works For SME Business Owners
Do you want to grow your SME business but spend less time in it?
Securing a talented Business Partner for growth or as part of a gradual exit plan can be an excellent option to consider. By allowing someone to buy into your business rather than appointing a solely salaried GM will get you higher capability and a person who is looking for skin in the game. This entrepreneurial person will be attracted by the equity component, not salary and is likely to have come from a higher-paying senior role in the corporate sector. Why do this over a salary only GM? You will get someone who :
- Works like an owner, not an employee.
- Can inject some capital for business growth.
- Has been exposed to transferable processes and training in the corporate world that can be introduced into your business.
- Will have a higher skill-set than an employee.
- Won’t just leave if they get offered a higher salary elsewhere.
- Gives you the confidence to take a break from the business and have a lifestyle.
- Will allow you to work on the parts of the business you enjoy and are good at.
- Can form part of your succession plan.
- Will bring skills and fresh thinking to grow your business.
- Will know how to harness technology to grow your business.
- Can increase your wealth as you keep getting dividends as well as capital payments from any further tranches of equity.
It is important to find the right person in a competitive process rather than just take a convenient option. Someone in your business may be considered but they must be tested against the same key criteria of Capability, Capital and Compatibility. They must also be entrepreneurial and have the required risk profile to invest capital.
About the Author:
Mike Warmington is a Director of Platform 1 NZ Ltd who specialises in using executive search techniques to find people with capability and equity for SME business owners wanting to transition.