How many of you business owners are familiar with the TIPRA?  That’s the Tax Increase Prevention and Reconciliation Act of 2006, which extended the historic low 15% capital gains tax until December 31, 2010.  At that time, the TIPRA “sunsets,” and reverts to the 2002 capital gains rates in 2011, unless the rate cuts are extended or made permanent.  Given the challenges in our economy, all bets currently are on the tax rate increasing to at least 20%.

So, if you have been in a holding pattern, anxiously awaiting an economic recovery, perhaps this, along with glaring statistics (if you care to do a bit of research) pointing to significant decreases in business valuation multiples, you may begin considering other options. 

Today I attended the fourth annual AccelerateCNY event in Syracuse.  It was a half-day of workshops in the following categories: Business Growth, Manufacturing Excellence, Sustainability and the Bottom Line, and Technology Innovation.  If I had to guess, I’d say it was attended by about 200 people, max.  Given the pertinence of the topics, and the quality of the speakers, it’s hard to believe more business owners and managers weren’t there.

Most small businesses that are marginal suffer from their owners spending more  time working in the business than the time they spend working on their business.  As long as I’m using clichés, I’ll also mention that not enough business owners spend adequate time sharpening the saw.  I actually heard two instances in the past two days, of business owners who have significant budgets to provide ongoing training for their workforce, which enables them to maintain a competitive edge.  But I wonder how many business owners budget time and money to improve their own business acumen.

If you’re a business owner from age 45 to 65, raise your hand if you’ve begun actively planning for the time you will exit your business. 

Just as I expected, a paltry showing.

Given the small number of business owners who run their businesses according to a written plan, it isn’t surprising that the vast majority of owners of privately-held businesses have no formal exit plan in place.  That’s not to say any business owner who’s asked wouldn’t have a strategy of sorts , albeit in his or her head. (That’s the answer we usually receive when we ask business owners if they have a written business plan. Much more often than not, they say, “No, but it’s in my head.”)

Business NotesYesterday I was called upon to make a call for a client who is in the process of winding down his business, selling its assets, and negotiating a work-out with creditors, in lieu of a formal bankruptcy. 

He was receiving calls from what he believed to be an attorney representing a creditor to whom he was in arrears.  The calls were so inflammatory and disturbing that he's been unable to sleep.  In fact, the messages left on his voicemail stated that they would put a lien against his house unless he paid the outstanding invoice.

Whenever I begin a workshop on exit, or succession planning for business owners, I begin with the obvious and much avoided question, “ If a catastrophic event removed you from your business today, what would happen to it?  To your family?  To your employees?  To your customers and vendors?

This question is particularly difficult for owners of privately-help businesses with fairly simple infrastructures.  Most entrepreneurs are optimistic, and so involved in their businesses, that they typically put off long-term exit planning.  Therefore, this question raises potentially painful issues, because they know the answer, and that their procrastination can have devastating effects.

Business NotesI just arrived home from an evening at the King Ferry Hotel, visiting with my friend Nancy Shaw.  We chatted the evening away, connecting on so many levels.  And the most striking part of our conversation all night came just before my partner Michael alerted me to “be prepared to exit the vehicle,” which is what he usually says when he’s dropping me of somewhere, usually about 10 minutes late.  (He tries so hard to be a good timekeeper, and I make his job really miserable at times.  I’ve accepted that fact that I’ve been born with a defective clock and compass implanted in my brain…)

At any rate, just prior to being given a ten minute warning, Nancy and I were discussing the joys of living simply.  ( Who would ever want to cut this discussion short?!)   She recalled that a while ago I told her that Michael and I decided to give his grandkids experiences for gifts – we realized that we couldn’t give them any things that would make lasting impressions, but we could give them memorable experiences.

I was at the gym recently, and while on the elliptical, read a short expose about Bernie Madoff in Vanity Fair, which I picked up off the magazine rack by the treadmills. It was written by his longtime personal assistant, who was totally unaware of his behavior until he was arrested.  Reeling from the effects of such a violation of trust, her feelings did a 180 from total dedication to and admiration of Madoff to feelings of disgust and real hate.

We all love to hate Bernie Madoff.  His greed.  His arrogance.  His lies.  How he bilked his best friends out of their riches.  His betrayal of trust, ruthlessly absconding with his clients’ life savings, leaving them destitute while living in the lap of luxury.

I wanted to write about sustainability for my first entry of the New Year, and found inspiration from a Christmas card a dear friend sent me.  The front of the card reads “Wherever you stand be the soul of that place,” by Rumi. How 2010, a Christmas card quoting a mystic Sufi poet! ( actually, it was a blank card, with a hand-written Merry Christmas message on the inside.)

Nevertheless,  the message is two-fold and very Aquarian: of the conscience of sustainability coupled with a celebration of spiritual unity. I’d like to make a connection of these ideas to business.

I went online to review the buzz that followed Obama’s meeting with a dozen top bankers at the White House on the 14th.  While he admonished the “fat cats on Wall Street” for their role in keeping money tight for Main Street and larger small businesses, he failed to address one major hole into which the economy leaked significantly – the TARP funds. 

Whatever happened to the 700+ BILLION DOLLARS that helped bail out the banks (beside what was used for executive bonuses and to fund bank acquisitions)????  And why, still, isn’t it being used to help American businesses?

With the release of The Secret a few years ago, there’s been an ongoing buzz in ever widening circles beyond the New Age strata about the art and science of manifestation. 

From the get-go I believed the authors of The Secret were capitalizing on the unexpected cult success of What the Bleep?, and put together a watered down version of teachings that have been available for millennia.  While the principles of manifestation may now be explained using quantum physics, the power of mind has produced in human beings fantastic results for ages.  Witness the great pyramids, Stonehenge, and Machu Picchu, to name a few. 

Business NotesI was at a get together of many old friends and acquaintances this past weekend.  All of us gathered together were women, most straddling midlife in various and sundry situations, personally and professionally. Of the 35 or so of us, most are employees in a professional capacity working in privately-held businesses,  non-profit organizations, or public institutions, one woman recently retired, and three of us are self-employed.   I had an interesting conversation with a friend, Anne, who was an HR executive, and laid off by her employer six months ago. 

She decided not to panic and to look carefully for the right situation.  She’s been interviewing for positions, locally and nationally, similar to her last employment gig. She has also begun a process that includes a re-evaluation of her life path.  Anne began really examining how she wants to invest her energies in her work life in the years to come.  Having left the corporate world, she feels free to wonder whether she might want to own her own business.  Among other options, she’s begun looking at different franchises to purchase.

Many of you may have reacted with mixed thoughts to the article in the Ithaca Journal this past Tuesday, about the action against Providence Hobbies by the New York State Tax Authority. Having worked with small businesses throughout upstate New York the past eight years, I find Jeff Wity’s experience more than symbolic of the dire situation of our current economy, and specifically, of small business, the backbone of our economy. 

Anyone who has not experienced the high risk rights of passage of entrepreneurship, such as being required to secure business lines of credit with personal assets, and who passes judgment regarding a business owner’s seeming failure or success, has little understanding of the business landscape on “Main Street.”