There is a uniquely bittersweet feeling that a CEO experiences when he sells the firm that he founded.
There's the euphoria that accompanies closing the deal and knowing unlimited possibilities that lie ahead, coupled with the strange realization that the company you created and nurtured for so many years no longer belongs to you.
Several months ago, I joined the ranks of a small group of CEOs who share a different feeling: the incredible exhilaration that accompanies buying back your firm.
Since January, when MWW bought back its independence from Interpublic Group, I've been besieged with questions from business leaders, politicians, friends, clients and colleagues about why we did it. I've also been approached by more than a few agency leaders who had sold their firms and are now considering a move similar to the one that we made.
For me, the decision to buy back MWW made sense from both an emotional and a business standpoint. To help others who are debating whether to also "take the plunge," I've put together a checklist, which represents the three vital factors that were a part of my decision-making process and should apply to most other businesses:
Is your business mature -- or is there room for growth?
Before you spend potentially tens of millions buying back your agency, you need to ask yourself one critical question: Is it the right business decision? Emotionally, there is always desire to want full control again over the company that you founded and grew to the point that someone wanted to acquire it.
However, before trying to buy it back, you must objectively decide whether the opportunity exists for growth.
This may partly depend on the discipline your agency operates within. In the case of MWW, we see tremendous opportunity in the PR industry, which is at the forefront of the digital revolution that has redefined the way we communicate.
Do your organization's priorities still align with that of your holding company?
When you sold your company, you likely had found a partner who shared similar goals, priorities and corporate values. As the years have passed -- and the business environment has shifted dramatically -- you may have found that your priorities are no longer in alignment with the company that owns you.
This is exactly the case that we faced with Interpublic. For more than 10 years, it was a fine partner and I'm proud to remain friends with many of its senior management team.
However, in a holding-company business model, management is encouraged to make decisions on a quarter-by-quarter basis. Now, as an independent agency we have the benefit of being able to make the best long-term decisions to grow our company, or as I'm fond of saying, "to make the right decisions for the right reasons." Further, we're now able to focus on only two audiences that we feel matter most: employees and our clients.
Is the passion still there?
You may be absolutely enthralled by the prospect of buying back your firm. But does your team feel the same way? Before leaving the relative safety of your holding company, you need to be certain that you have the support of your staff, and that they will share the same level of excitement and passion that you do.
When I first considered buying back MWW, I gathered with my senior team and gauged their interest. Many of my management team had been a part of the firm when we sold to Interpublic 10 years ago and my hope was that they would relish an opportunity to return to the entrepreneurial culture that defined us as an independent agency.
I wasn't disappointed -- a dozen members of my management team joined me as part of the group that led the buy-back of MWW Group from IPG. But it's not necessarily going to be that way at every firm and finding out how committed your team is to such an undertaking is absolutely key.
Since MWW first opened its doors more than 24 years ago, there have been many great moments. Now, in the weeks following the buyout, I walk through the halls of our offices and feel a rush of electricity and enthusiasm among staff at every level that's incredible.
For us, buying back our firm was absolutely the right decision, and I wish the best to any others who may soon join us in the independent ranks.
|ABOUT THE AUTHOR|
Michael Kempner is president, CEO and founder of MWW Group, one of the world's five largest independent public-relations agencies.