“Legacy building” is a term that gets used a lot in the context of the family enterprise, but it's one that I think is sometimes misunderstood.
Whether intentional or not, there's a tendency to describe legacy building as a project the current generation (or, in some cases, a single wealth creator) can complete themselves — the idea that they can spend their lives constructing a legacy like a monument that will, with proper maintenance, remain sturdy through the generations.
But it seems to me that building a legacy is a job that's never really finished. If you're the wealth creator or a member of the second generation, you're laying the foundation. Your role is to give future generations the tools they need to continue the project. Their job is to reinforce what's come before while expanding the structure in new and exciting ways that can still be supported by the bedrock.
As Charlie Rhomberg, a fourth-generation member of a family enterprise, writes in this issue: “Most of your legacy will be out of your control. Once you're gone, the decisions your children and grandchildren make will ultimately decide the fate of the family business.” Instead of trying to micromanage or preempt those decisions, he urges current gens to focus on instilling the right principles and a solid financial education in younger family members, while also giving them the space to become their own people.
This issue is dedicated to helping current generations both contribute to and support legacy-building projects that will hopefully continue long after they're gone. At the risk of really overdoing the construction metaphors here, we cover some of the more “nuts-and-bolts” ways to do that, with articles on estate, succession and tax planning, among other topics.
But you'll also find guidance on more abstract concepts related to legacy, like teaching young people to be good stewards of wealth, getting NextGens engaged through philanthropy, solidifying values that can be passed down the generations and creating a culture that fosters healthy family communication.
Our cover story is on Wenatchee, Wash.-based Stemilt Growers, the largest sweet cherry grower, packer and marketer in North America. While the family business is officially 60 years old, its roots reach back through five generations of farming in the Mathison family.
Sarah Brodsky's profile of Stemilt depicts a family that is very much still in the process of building on the legacy of its predecessors. What began with an $88 crop of cherries in the 1950s has, through relentless innovation, ballooned into a business that generates about $1 billion in annual revenues. Over the years, the company has remained family-owned and -operated and leadership transitions have largely happened organically. But today, there are only three Mathisons working in the business: brothers West and Tate and their father, Kyle. Now they're hoping to change that by instituting a more proactive and formalized succession plan that brings other family members into the fold and equips them to carry the company — and the family legacy — forward.
As Tate puts it: “If the family is going to integrate into the business, it needs to have a way and a means to do so. Versus like, ‘Hey, Dad's dead. Now you've got to take over.' If you have a very, very flat company, it's very difficult to have someone come into the business and work their way through.”
The same can be said about building a legacy: It's not a solo project. Ideally, it's one that the entire family should be trusted and encouraged to get involved in.
As of this writing, we're preparing for our Family Business Legacy conference in Dallas at the end of September. The theme this year is “Future-Proofing Your Family's Legacy,” and the discussions will focus heavily on the premise that building a legacy is an ongoing, multigenerational team effort.
I hope to see you there!