Cambridge, MA – More than half of small business owners in Cambridge are aged 55 or older, but only 22% of businesses in the state report having a succession plan. This represents a looming threat of a wave of small business closures and job losses in the region, according to Sarah Jane Huber, Associate Economic Development Specialist with the City of Cambridge Economic Opportunity and Development Division (EODD).
Sarah Jane, whose office supports small business owners in Cambridge, aimed to learn more about how to support business owners with succession planning, so that owners can plan for their retirement and transition out of the business while keeping the businesses and jobs in the community.
That’s why Sarah Jane participated in a fellowship program that would better equip her and her office with the tools and knowledge to support small business owners as they begin to think about retirement. That program is called the Northeast Transition Initiative (NETI) Fellowship Program. Sarah and her fellow cohort members graduated from the program in the fall of last year.
“Cambridge business owners desire to make their businesses the best they can be,” Sarah Jane said. “They want their businesses to remain in the community. They want to see it in the community even after they’re gone and they want to take care of their employees who have helped to build the business into what it is today.”
After graduating from the NETI Fellowship, Sarah Jane hoped to bring more awareness of succession planning and exit options, such as employee ownership, to more business owners in Cambridge and beyond. She and her colleagues in EODD organized educational events to bring business owners and resources together in one place.
In May, they hosted the first of these events at Cambridge City Hall. They invited a panel of business owners who made successful exit transitions, as well as providers who specialize in connecting resources to business owners. Additionally, EODD hosts succession planning-focused workshops and has created a free toolkit for small business owners.
“The City of Cambridge is ahead of the game when it comes to providing resources and promoting the importance of succession planning for business owners,” said John R. Allen, III, President of Allen Business Advisors, who moderated the May event at City Hall and graduated from the NETI Fellowship Program last fall. “Many business owners don’t know that there are resources and options out there. They’re not alone. NETI alumni are working together to bring education and awareness, so that more people know that we’re here for them.”
During the event, which had 45 attendees, a panel of Cambridge business owners talked about their experience selling or transitioning their businesses. They all had different approaches, but the goal was the same: to keep successful businesses in the community.
“Local businesses in Cambridge are so important to the fabric of our community,” said Cambridge Assistant City Manager for Community Development, Melissa Peters, in a statement. “We all have foundational memories that involve special local establishments, and when those places cease to exist, we feel a meaningful loss. Our work on succession planning is to help ensure the bright future of our cherished neighborhood restaurants, shops, and service providers so that they continue to thrive in our City.”
The panel included:
- Caleb Z. (right), Founding Co-Owner, Circus Cooperative Café.
- When the previous café owner closed the business, the employees formed a cooperative and opened a new business in its place.
- Joshua Gerber, Owner of 1369 Coffee House.
- He purchased the business from his uncle, Gerry Wolf.
- Gerry Wolf (not pictured), Founder/Former Owner, 1369 Coffee House
- Julia Hallman, Owner, Formaggio Kitchen.
- She was an employee of Formaggio Kitchen before she bought the business from the previous owner.
- David Sandberg, Co-Owner of Porter Square Books.
- He sold 50% of the business to his employees.