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Working with Successful Families

Working with successful family businesses has its complexities.

At times, you've got the owner who's built the business and coming out to retirement, maybe looking for an exit plan or maybe a build some considerable wealth. Plus you've got kids coming through who may or may not suit working in the business.

So how do we deal with that? How do we deal with the family wealth? Do we want our children possibly be the next Paris Hilton kids or the Country Club kids?

It's quite difficult often when you are close to something to run your own discussion, especially in a family business. Watch as Scott Fitzpatrick from the Fitzpatricks Groups shares his thoughts on how can successful family businesses build a life plan than spans generations.


Greg: Thank you everybody for taking a few minutes out of your busy days to join us for Momentum Talks. I'm Greg Gunther, I'm a director and co-founder of Your Business Momentum. Today, we've got a special guest. I’ve known him now for quite some years – Scott Fitzpatricks from the Fitzpatricks Group. Welcome, Scott.

Scott: Hi Greg, Good to be here.

Greg: Thank you. And before we get started, I’m just going to give Scott a quick introduction, just to give the people watching and listening a bit of a background.

So Scott founded the Fitzpatrick's group back in 1987. And he's got more than 25 years wealth management experience. He's regarded as one of the change agents who introduced genuine, professional fee for service advice in Australia well ahead of his time. Scott is in high demand with other professional advisors and firms, train them in advice and client management. Thank you again, for coming on.

So today, we're actually going to be talking about working with successful families. So, Scott, a few questions I'd like to ask, the first one I'd like to ask you something that might be just a little bit different, particularly as it pertains to family business.

Scott: Well I think, one statistic is that family business represents small business represents 50% of Australia GDP. Probably the most under service segment of the market. Another statistic I like, is that New South Wales in particular is the third most litigious state in the world after Florida and California.

Greg: Is that right? Wow.

Scott: Protecting your assets. It should be on the agenda for family business.

Greg: Wow. Yeah, that's very relevant. So, Scott, you know, you obviously the founder of Fitzpatricks Group. Tell us a little bit about the sort of services that Fitzpatricks provide and what would you be particularly known for?

Scott: I think what we love is the successful family, successful business owner marketplace, it takes an eclectic skill set to service that market. The idea is that the way we like to position ourselves to sit on the family board, and to be across all their issues. And one of the issues are financial. But similarly, all of those issues are non-financial. So we need to be across the areas, you know, tax and accounting and estate planning and asset protection insurance. But it's in a context about what makes a great life for this family. That's a start point. It will be families to build a family plan or a life plan.

Greg: And, you know, I guess to Scott with family business, you've got this sort of intergenerational challenges as well. So you've got competing sets of objective essential.

Scott: Yeah, there's there really is some complexity there that you need to be able to get across. And one of the things that you know, quite the flavor of the month at the moment is developing family constitutions or the family rule book that highlights intergenerational wealth.

Greg: So, maybe just expand on that a little bit. Scott, like for a lot of people that probably don't fully understand but what do you mean by that?

Scott: Yes, sometimes you've got the owner who's built the business and coming out to retirement, maybe looking for an exit plan, maybe a build some considerable wealth, you've got kids coming through who may or may not suit the business. So how do we deal with that? How do we deal with the family wealth they will they want the children possibly to be the Paris Hilton kids or the Country Club kids? But even on from an estate planning point of view, how do we deal with that? So we need to you know, rule book around how the wealth’s to be transferred over time.

Greg: That probably segues really nicely, Scott into my next question, which is, you know, what would be would you consider the two or three of the major problems that arise in family business?

Scott: Well, the start point is typically no plan. So, you know, I think it's a really important for us to get the context right for the business that we're trying to get to as a family and where we're trying to get to as a business, some need to separate those two things there. Definitely dealing with the content, like ROS is protected. Do we have financial strategies in place, have we sold out that estate planning for the other passing over control? Any of these things can take 12 months to 2 years to sort through.

Greg: And, Scott, you know, it's for a lot of people sort of watching or listening, that might all sound a little bit overwhelming what would be sort of one action would be prudent eyes just to get that process started.

Scott: I think, start point is the start point, is you need to sit down as a family or family group and go where are we going? Then If I need a facilitator to help that discussion. I just think it's invaluable and you know, quite often, even when your spouse to sit down and have that conversation, we never get to. We like to see, you know, we like to position ourselves as sitting on the family board, then as appointees helping you work out. What does the life plan look like? What does a great life in front of you in the next 5 or 10 years’ time?

Greg: The key point that you are raising there which I like is “facilitated”? I think you're right. It's very difficult often when you close to something to run your own discussion.

Scott: I think someone on emotional a little bit detached from it has been around for a while and hoping that can help lead that discussion. It's your plan for you, not my plan for you. Just need to framework to change that out.

Greg: Yeah, good. And Scott, like in terms of valuable tool system, maybe the piece of content that you could point people towards, to maybe just get a bit of background on some of these things.

Scott: I think there’s two pieces is, what you know, as I said earlier about the whole asset protection piece, I think that's really important for people get their head around that as a separate business and personal welfare. We do have some articles on our website, relevant schools that even from an investment point of view, which we haven't really spoken about a lot, but it's really important to people to maintain their capital and get it consistent so they might have so many people taking, got risking your business and they're taking far too much risk in their investment as well. So I just think people need to have a gauge or someone to help them from a risk management point of view and we have tools on our website that talks about risk and risk management.

Greg: I'll give the website in a moment. But you mentioned earlier that, you know, the New South Wales is particular state. And that really does heighten the awareness.

Scott: I don't want people to take it from a field point of view. I just think it's something that you need to be conscious about it and you need some conscious decisions about how you structure yourself and move on with your business.

Greg: Nice makes a lot of sense. At least you've got a knowing around what it is you're trying to achieve.

Thank you Scott, I know that was like a brief summary and synopsis of what you’re great of. I think if you want to actually know more, I think you can actually see from Scott. He's a lot of experiences a lot of passion, particularly as it comes around to family business.

If you need to speak or even reach out to him, I'd suggest you land on their website, which is www.fitz.com.au.

Just following that, if you enjoying our Momentum Talks, we'd love you to just took a minutes to subscribe because from time to time, we may will sort of have a little thing on very effective a topic that you'd like us to cover, please contact us. Thank you again, Scott.

Scott: Okay, thanks.

Greg: Thanks, Scott.



  • Scott Fitzpatrick

    Scott Fitzpatrick

    Scott founded the Fitzpatricks Group in 1987 and has more than 25 years’ wealth management experience. He is regarded as one of the change agents who introduced genuine professional, fee for service advice in Australia.

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