Family-Owned Businesses Survey

About a decade ago, Mass Mutual Life Insurance did an ownership transition survey. The results were based on answers and feedback from family-owned businesses. Although this survey has an outdated timeline, there is still some valuable pieces of information that one can glean from it. In this article we will take a look at the numbers and what they can tell us for 2021 and beyond.


The Mass Mutual Life Insurance survey had a range of important points. The most astounding result was that 80% of family-owned businesses are still being controlled by their founders. Baby Boomers are a large percentage of those founders. These founders will probably retire in the next few years.

According to the survey, 55% of CEO’s over the age of 61 have yet to choose a successor. This result emphasizes the fact that many CEO’s will be retiring, which will lead to some opportunities. Although the survey indicated that 13% of CEO’s said that they will never retire, the reality of the situation is that ownership will eventually change hands. Prospective buyers will have a unique opportunity to buy established businesses.

Another result of the survey is that 30% of family-owned businesses will change leadership within the next five years. The change of leadership opens up the possibility of selling. However, it is important to note, that not all businesses currently owned by Baby Boomers will go on the market.

The survey also indicated that 90% of businesses currently plan on remaining family-owned. 85% of businesses plan on having their next CEO be a family member. Even if these numbers hold true, at least 10% of businesses will be up for sale.

Things To Consider

It is likely that the 10% of businesses for sale will be higher now than when the survey was conducted. A couple of reasons for this is the aging nature of the Baby Boomer population, and owners looking to sell because of the pandemic related issues.

Another thing to consider is the fact that most family-owned businesses are not prepared to sell. The survey showed that 20% of family-owned businesses have not completed any form of estate planning. 55% of family owners do not have any formal company valuation for estate tax estimates. Many family-owned businesses are ill prepared for the future. M&A advisors are uniquely positioned to provide the services needed to help business owners prepare for their future.



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