Jul 21, 2020

E15: Ups and Downs After the Sale – Doug Austin, James Austin Company

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James Austin Company was a fourth generation family business without a succession plan. After 130 years, the company sold to a competitor in 2018. I spoke with one of the family members, Doug Austin, about his experience before and after the sale. Doug was an ex-prosecutor, ex-litigator and ex-street salesman for years. His mantra was, it’s all about the “sale.” Now, two years later, the sale has been an emotional letdown. I appreciated Doug’s authenticity around what it feels like to sell the family business and I hope that you will too.

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Full Transcript:

Laurie Barkman:

Welcome to Succession Stories, insights for next generation entrepreneurs. I’m Laurie Barkman. I’ve spent my career bringing an entrepreneurial approach to mature companies struggling with change as an outside executive of a third generation, 120 year old company, I was part of a long-term succession plan. Now I work with entrepreneurs, privately held companies, and family businesses to develop innovations that create enterprise value and transition plans to achieve their long-term goals. On this podcast, listen in as I talk with entrepreneurs who are driving innovation and culture change. I speak with owners who successfully transitioned their company and others who experienced disappointment along the way. Guests also include experts in multi-generational businesses and entrepreneurship. If you are a next generation entrepreneur looking for inspiration to grow and thrive, or an owner who can’t figure out the best way to transition their closely held company, this podcast is for you.

Laurie Barkman (00:58)

James Austin Company was a fourth generation family business without a succession plan. After 130 years, the company sold to a competitor in 2018. I spoke with one of the family members, Doug Austin, about his experience before and after the sale. Doug was an ex-prosecutor, ex-litigator and ex-street salesman for years. His mantra was, it’s all about the “sale.” Now, two years later, the sale has been an emotional letdown. I appreciated Doug’s authenticity around what it feels like to sell the family business and I hope that you will too.

Laurie Barkman (01:34):

Doug, welcome to Succession Stories. I’m excited to speak with you today. Let’s start by talking about the family business James Austin company. It was founded in 1889 by your great grandfather, which makes you part of the fourth generation or G4. Can you share a brief overview about the history of the company and what it’s most known for.

Doug Austin (01:54):

Sure. In 1889, my great grandparents had a grocery store in Greenfield, Pennsylvania, right outside of Pittsburgh. My great grandmother, every spring she would clean her carpets and she went to my great grandfather and asked him to buy some soap to clean the carpets. And those days you wash them and then you hung them out to dry on the line outside. Well, he’d thought that he could make his own soap. So on his stove, he developed some formula and made it and gave it to her and she liked it. And her girlfriends liked it so much that he started bottling it in Coca-Cola bottles and sold it in his store. That was the precursor to what we had- it was the Austin’s Wipe Away carpet cleaner, which is still being sold today. So that was the beginning of that in the business progressed. And ultimately we evolved into a company making a bleach. The interesting thing about our bleach manufacturing was that in the ‘60s Koppers chemical company came to my dad with the process making plastic bottles. And they asked him if he would be willing to bring in several of their machines to make plastic bottles. And in those days you would sell bleach in glass bottles and ship them in wooden crates. And it was a very cumbersome thing and he thought it would be a great idea. So ultimately we were the first manufacturer in Western Pennsylvania to put anything in plastic bottles.

Laurie Barkman (03:24):

And so the story is evolving for the business. And we’ll certainly talk about that. But at one point in its history, it was known as the oldest family owned bleach manufacturer in the US is that correct?

Doug Austin

That’s correct. Yes.

Laurie Barkman

That’s a great history. James Austin company found in 1889 and there’s something in there too, along its transition, its history. I guess the G2 then would be your grandfather.

Doug Austin (03:51):

Grandfather. Yes.

Laurie Barkman (03:53):

Is there a story there? You told me something before the show about some of his history during World War II.

Doug Austin (04:00):

Well, in those days they didn’t spend a lot of time going to lawyers and didn’t think about legal matters. So he was one of three children. My grandfather was, and he spent most of his life working in the business and developing it. He had two sisters who didn’t participate in the business at all, but when my great grandfather passed away, in his will, all he said was– my grandfather’s name was Harry. And he said, Harry, just take care of the girls. And that’s what his will said. Well, my grandfather then took over the business and it progressed. And unfortunately the family dynamics was such, the sisters came along and said, well, that’s our business too. And there was a big fight over what was actually meant by “Harry take care of your sisters.” So ultimately the family had to go to court and my grandfather had to buy the business back from his two sisters who never really participated in the business.

Doug Austin (04:56):

So that was the first hurdle that we had to overcome. Then World War II came, and all the young people went off to fight in the war, including my father and my uncle. So they were off fighting in Europe and my grandfather was having a difficult time making the business go. So ultimately he thought, well, it’s a small business. It doesn’t mean very much. So he sold it and he sold it to a company – which a lot of Pittsburghers know- a company called Spic and Span and for maybe a year or so, Spic and Span was the owner of the Austin Bleach company. My father came back from World War II thinking he had a job. And when he returned, he found out, oh my god, I don’t have a job. His father had sold the business. So after some discussions, he and my grandfather went to Spic and Span and bought the business back and then started working from there. And in generation three, I guess is what we’re going to call it. My father and my uncle, my uncle Jack ran the business. My dad was the President. My uncle was Vice President. And that’s how it progressed until the fourth generation came along.

Laurie Barkman (06:02):

So that must’ve made some awkward Thanksgivings. When your grandfather’s sisters had sued him, essentially for some rights for the company.

Doug Austin (06:10):

In that generation, it wasn’t so bad because they all moved to Philadelphia. And so they really didn’t get together very much. And I’m too young to remember any of those Thanksgivings, but you know, that’s one of the dynamics of the family business. You’re working everyday together. And then you may have a blow up. You may have a fight business-related, and then at night you have to get together and be social. And that really does create some bad chemistry in that regard.

Laurie Barkman (06:37):

Yeah, the bad chemistry. That’s kind of a funny joke because you’re a chemical company. You mentioned the third generation. You have your father, your uncle Jack, and then the fourth generation joined. You’re part of the fourth generation. Anyone else from your family?

Doug Austin (06:54):

I have my brother. He is the patriarch of our group. He’s the oldest then followed by two cousins, my cousin, Lisa and my cousin, John. Lisa and John are from my Uncle Jack. And then there’s me. I’m the baby of the family. And it was interesting because during the transition from generation three to generation four, the business grew. We were always located first in Greenfield. Then we went to Lawrenceville. From Lawrenceville, we went to Hazelwood, and then ultimately my grandfather bought a farm in Mars, Pennsylvania, up in Butler County and moved the whole factory from there up to Mars. Since then in the next generation we expanded and we had four factories total all over the country. We were in New Hampshire. We were in Massachusetts. We were in Mars, PA, North Carolina, and Florida.

Laurie Barkman (07:52):

So multiple locations, which is probably a good segue for me to ask you about your experience, joining the company. It’s a common question that I get. People are curious about family businesses and the leadership. And if people get work experience outside of the family biz, before they join, what was your experience?

Doug Austin (08:13):

I recommend it very highly that everybody should go out and get a job before they enter their family business. The main reason is because you learn how to be an employee. There’s some feeling that you don’t have when you just go straight from being a child in the business to being management. There’s never that fear of being able to be fired every single day you go to work for something that you do. And so when you actually go out and work for somebody else, you learn how to be a good employee, which then helps you relate to employees when you have them. So what happened to me since I was the baby, and there were all these people in front of me and I knew there was never an opportunity for me ever to become President of the company, I went on my own. I went to law school, became a lawyer.

Doug Austin (08:55):

I started off as a prosecutor with the Attorney General’s Office in Pennsylvania. Then I started a law firm and then had another law firm. And, ultimately I became a litigator and that was what I did for many years. The tough thing was, is that my dad always had the dream of me being in the family business. And even though I was going through law school, he would come to me and say, well, we’re really proud of you, but we really want you to come into the business. And I always put that in the back of my head because I knew I wanted to be a lawyer, but unfortunately that added a little pressure on me. It was never an easy road for me because I just never knew what was going to happen. I was getting the support of my family. But my dad always wanted me to come into the business and I was too young.

Doug Austin (09:41):

I want to say I was too stupid, but I didn’t appreciate what the family business was giving because when you grow up in it, you become blind to what it actually provides. And so I never recognized that until I started my law firm. And, and then you start a business and you, anybody that has started a business knows how difficult that is. You live on credit cards, you live on credit, you do what you can to survive, but it took two or three years for my law firm to really kick off. And then it did, but it was a very humbling experience. And it was a very difficult experience, especially because my father had this rule that if you were not in the family business by age 30, then you were not allowed to be in it. And that was the rule that he had for both my brother and myself. My brother was already in the business so it wasn’t an issue for him.

Doug Austin (10:28):

But for me, it was a big deal. I saw my brother and my cousins. They were always traveling. They were always staying in hotels. And I became a little jealous because I was always stuck in a law office in Pittsburgh and going back and forth and working six days a week as a lawyer. And it just seemed like they had a much, I don’t want to say easier life, but it was a more relaxing life than what being a lawyer was. And so at the age of 29, knowing that my timeframe was running out, I came to my dad and I said, you know, Dad, I think it’s time for me to get into the business. And so there was a lot of haggling going on, a lot of issues. He was happy about the whole idea, but the question was, how do we fit Doug in, especially since he had no experience with bleach and whatnot.

Doug Austin (11:19):

So it took a while. He had to take me under his wing and he had to teach me the business. And it was a very, very odd thing to go through. Finally, by circumstance or happenstance, we had an opening in our Florida facility and my dad asked me to go down and run sales of the Florida division. And that made it real easy. I mean, to attempt a 20 year old to say, do you want to go live in, in Florida? Wow. That was a great experience. And so off I went, but he was very nice about it. He let me still continue to practice law. I kept the law practice open with my partner and she and I ran the firm and I would fly back to Pittsburgh and try cases. She did the research and I was the litigator. So we did that for many years until unfortunately she passed away from cancer. And so we ended up closing the business up around 2001– 2001 is when I had my last jury trial.

Laurie Barkman (12:21):

There’s a lot of transitions in there. So when you first learned about your father’s desire for the age 30 cutoff, did he ever share with you why he insisted that if you didn’t join the company by age thirty, you were never going to join the company?

Doug Austin (12:37):

I think he did, and I don’t remember the reasoning. I think he just thought thirty was the right cutoff point. He always told me that there was always that thing in his generation. He had two brothers and a sister, and the sister didn’t want part of the business. The one brother became a doctor and then the other brother was my uncle Jack. And so I think in his mind, that was the way he was going to resolve the issues that came along with my grandfather and his sisters. So he was trying to think ahead and come up with a fail safe method on how to protect the business.

Laurie Barkman (13:09):

You mentioned there was a nice relationship with your father. He kind of took you under his wing, gave you the space to keep doing law and litigating. Were you doing law for the family business?

Doug Austin (13:21):

Yes, I did that as well, but I was basically handling my own clients in my law firm.

Laurie Barkman (13:26):

What were you doing when you joined your family business, James Austin. What was your role there?

Doug Austin (13:33):

I was in charge of sales in Florida and that meant not only Florida, but the Southern part of the United States, the Southeastern section. So I was living outside of DeLand, Florida, which is near Daytona Beach and ultimately was traveling and calling on customers. And the thing was learning the business. And that was a thing that I had to learn– how to do pricing, and how to do advertising, marketing, and all that good stuff. We had a plant manager, we had somebody running the plant in Florida, but he was a very nice guy and he was eight brought me under his wing and was showing me how to run the business. And so it was all a big learning process.

Laurie Barkman (14:13):

And typically lawyers are not known for being salespeople. So I guess in some sense you had to learn a whole new skillset, but you must’ve had some innate skills that helped you. And I also understand from a little bit about the product that it serviced pools. So was that part of your customer ecosystem in Florida? There were certainly a lot of pools.

Doug Austin (14:33):

Yes, on the wholesale side of things we would sell to companies that ultimately would sell to other companies that made the calls and cleaned the pools and whatnot. But to go back, being a lawyer is a salesman, especially when you’re a litigator, because you’re trying to sell your story to a jury or to a judge. So there, it was kind of interesting I think growing up in a family business, you always were always surrounded by sales, always surrounded by business. So when I became a lawyer, it was kind of easy to go into that. The only problem that I would run into was when you were a salesman and there was a difference between reality and what the book said. I remember being at a grocery store down in Washington, PA and it wasn’t my first time, but I was working for Austin before they sent me to Florida.

Doug Austin (15:34):

And it was a very short time. It was for just like a learning experience. And the manager of the store came up to me and said, I want you to take back certain products that weren’t selling. And I said, well, I’ll do that, but you already bought them. And I I’m thinking as a lawyer, you signed a contract, the contract is a valid contract, and you’re stuck with it. And he pretty much told me, you can have that attitude, but if you do that, I’ll never buy anything from you again. So lawyers think differently than business people. And even though lawyers are business people, it’s a very strange dynamic there where you have to say, all right, here’s reality versus what the law says. And that was the biggest lesson that I had to learn.

Laurie Barkman (16:16):

Yeah, for sure. I want to ask about the dynamic between the other family members. You mentioned your brother. So your dad was excited, you were joining the company, you were learning the business you’re in Florida. Your brother at this time, was he President or was your dad still in charge?

Doug Austin (16:32):

My dad was in charge and then my uncle was, was second in charge. My brother was in charge of all sales and it was a very weird thing because my cousin, John and I were the closest, because we would always play together. We were very similar in age. He was one year older than I was– I am. And so he and I did well together. My cousin, Lisa, she was doing something else in the business that had nothing to do with sales so I didn’t have to work with her. There wasn’t really a dynamic with her. And then my brother, Harry, it was a very strange relationship because he was my bigger brother. And, I was always used to him being my older brother. And if anybody that has an older brother knows what that situation is. To take that now into the family business world, it was a very, very strenuous situation, I guess. When you’re picked on as a little brother…and to this day, he sees me as his little brother and he never really took anything that I had to say seriously.

Doug Austin (17:35):

He was the one that was always calling the shots. And so I never could really contribute really anything in his eyes. And so, as a result, my cousin John and I would work together and try and keep my brother out of the biggest decisions while we were running our day to day lives. And then we would call on my brother. But I have to admit it was a very difficult thing because older brother, younger brother, and no matter, and I think anybody can agree with this, that you never get rid of that.

Laurie Barkman (18:04):

Yeah. I mean, if he was into wrestling and pinning you to the ground as a kid, it’s probably hard to flash forward and think about having you as an equal on the team. If he has kind of the older brother perspective, that he’ll always be better than you in his mind, if that was part of that dynamic.

Doug Austin (18:24):

Right. And again, going back to Thanksgiving. You could have a really bad, big brother, little brother, fight at work and then have to go over to his house for Thanksgiving dinner and it made it very awkward. Because you have to try and put your personal thing aside and the business aside and it was very difficult.

Laurie Barkman (18:51):

Did you have any buffer? You just mentioned your cousin, were there any other buffers in your family that you could talk to about it?

Doug Austin (18:58):

Yep. I used my mother. And of course being the baby of the family, I knew that you could always go to your mother and I complained to her and then she would take your side and go beat up my older brother. So I would always use my mother as the buffering and complained to her. And I knew that as long as I had her around, I was safe. And so it took till the day she died that was the way we did things. And I knew my brother knew what I was doing, and it was pretty obvious, and he hated it. But here again, when you have a business…and that’s the one drawback, one of the main drawbacks of family businesses that you have to throw the family into it. So you have the mother protecting, over everybody.

Laurie Barkman (19:40):

And your father at this point. When did he transition to becoming chairman or did he leave the company altogether when he retired?

Doug Austin (19:48):

Well, officially my dad and my uncle never retired. They worked until they passed away. My dad passed away in 2001 and my uncle passed away. I’m going to say five years, six years later. My dad passed away at 86, so he was always grooming the next generation of what their roles were going to be. When ultimately, he worked the day that he passed away. He never really moved away from the business. He was not really sick, so he never had a downtime. Other than normal hospital stays, but he wasn’t in a nursing home or anything like that. When he passed away, it was okay the next day the business has to continue. So everybody moved up, around. And so we were already to move into that world. And then my uncle became head of operations and my brother became the President, because my uncle became CEO and Chairman of the Board.

Laurie Barkman (20:55):

But it was pretty obvious because of the grooming that you knew your brother was going to ascend to CEO eventually.

Doug Austin (21:03):

Yes, I think that’s one of the things that our generation decided that we need to, we need to pick somebody who’s going to run the business. And it was always thought of as my brother being the oldest, he was going to be the guy in charge. That was never an issue. That made it very easy because when decisions had to be made down the road, we relied on him to make those decisions.

Laurie Barkman (21:24):

So your father passed away in 2001. And if we just jump forward a decade or so, your company sold in 2018, correct? I wanted to talk about the sale, who was involved in the decision making about putting the company up for sale?

Doug Austin (21:44):

Well, it kind of came as a surprise to everybody. And what I mean by that is as family, we would always hold meetings. Whether it be sales meetings or operation meetings, and one day we were in my brother’s office and he said, guys, we have to figure out what we’re going to do because my brother just turned, in his early sixties. And he said, we don’t have to think about it now, but ultimately we’re going to have to do something with the business. We have to have a succession plan. Since we were all very similar in age, there was a four year difference between me – the baby- and my brother, the oldest, we were all going to retire at the same age. I think all of us had the idea that we would work like our parents, our fathers and uncles, where we would just continue on until we died.

Doug Austin (22:35):

And, that was fine. As long as you had the next generation. Well, we didn’t really have the next generation. My brother’s kids were just coming out of college and they were starting their careers and they were not involved in the bleach business and had no desire really to be in the bleach business. My cousin, John, had his kids, but they were still in high school. So they really didn’t know what they wanted. And my cousin Lisa’s children were in the business, but they didn’t want to be involved in the managing of the business. I have no children. So we looked at each other and said, what are we going to do? And because we were a family business, a lot of our trusted employees that we had were all people that grew up in the business and they were all retiring.

Doug Austin (23:22):

So we really couldn’t give it to the employees. So we started to think, we need to come up with a plan. It didn’t happen to be right away, but we had to come up with something. And lo and behold, out of the blue, our competitor, who we were always in a knockdown drag out fight with over pricing and customers and all that, just came to us and said, if you guys are interested in selling, we’d be happy to buy it. And that got us thinking and got the ball rolling. The family made the decision to go and sell in November around Thanksgiving. We met with the owner of our competitor at the Pittsburgh Airport around Thanksgiving, and the company sold in March. The final paperwork was signed in March. Our accountants and lawyers all said it’s amazing how quickly this goes. We were at a company of $100 million dollars in sales and with four factories and all the employees we had, it should have taken a lot longer than it did, but because all the family was in agreement that there was not one family member that said, no, I want to keep the business. And based on what the situation was we all sat down and agreed to it, the lawyers and accountants went through it and before you know, it was all said and done.

Laurie Barkman (24:43):

That’s incredible how quickly the deal closed and how smooth it was. And were you involved in the due diligence phase where the other company was talking to all the family members and management team? Were you part of that process?

Doug Austin (24:56):

Yes. All of us were, and we all played a part. I was able to show my great lawyer skills when we would sit down with the lawyers and I would ask questions. It was kind of fun because I got to be a lawyer again. In all it was an easy process I should say.

Laurie Barkman (25:15):

Yeah, it took time, but I think in the scheme of things, and it sounds like it was a good fit. So who ultimately did the company sell to? You mentioned it was a competitor. Can you just share a little bit about them?

Doug Austin (25:26):

Sure, it’s a company called KIK Custom Products. KIK Custom Products is owned by an equity group. KIK is an independent part of a subsidiary of the equity group. They are the largest bleach manufacturer in the United States. We don’t associate ourselves with Clorox because Clorox has kind of its own little world it’s kind of over there because we deal in different kinds of customer bases once you get beyond the grocery stores. So they were the big guys. They were headquartered in Toronto, Canada. It’s my understanding that they have since moved to Chicago, I think, but they were the largest. They came in and bought us and they gave each of our family members a one year contract to continue on to help with the transition phase. My contract ended in March of 2019. That was when I ultimately left the bleach world. That’s where I’ve been ever since.

Laurie Barkman (26:36):

One thing I read about the company that you mentioned, KIK, they also own Spic and Span, which is an interesting historical tie-in seeing as your company was once sold to them as you mentioned earlier, in World War II, is that correct?

Doug Austin (26:51):

That is correct. Yes. KIK went on a little buying spree and they started buying up little soap companies and little chemical companies. And one of the ones they bought was Spic and Span. And it is kind of funny because here it is the company that my grandfather sold the business to is now the same company that the fourth generation sold the business to.

Laurie Barkman (27:12):

And I appreciate you sharing some of the mechanics. You talked about the deal and how it was structured. And then the family members had a one year contract. I want to talk about the emotional side of this. What did it feel like when you were going through the deal and then now it’s done and your family since 1889 has owned James Austin company, and now you don’t. What did that feel like?

Doug Austin (27:38):

At first, it was kind of a relief because going through a sale, it’s a stressful thing. And there’s all kinds of little things you have to accomplish while you’re going through the sale. So it’s more mechanical than anything else. So you’re not really thinking about the ramifications of selling the business. Then working for the business for the year, it was a little frustrating because here a new company is doing what you were doing. And they’re changing things the way you used to do things. And that was, you get a little frustrated, a little aggravated, but you could see a little bit where they were coming from. It was also difficult because they were the enemy and you were sitting there doing battle every day with them. And, you always pictured them as these nasty people. And now all of a sudden you’re best buddies and just overnight, there you are, you’re friends and all those salesmen that you were fighting against are now people that you work with.

Doug Austin (28:35):

Emotionally that was a little hard to deal with. And, also you went from being the owner of a company to an employee, and that was a humbling experience. You couldn’t do things without somebody else telling you what to do. And that made it a little difficult. Now that a year has passed, I sit back and I think it’s very emotional. It’s becoming an emotional thing because growing up, you’re in a family that is a part of a community. Mars, Pennsylvania is very small and we were the largest employer in Mars, Pennsylvania. And when you were in Mars, everybody knew you. I mean, it was it wasn’t like, oh, there goes an Austin. It was like, there’s Doug. And everybody treated you very nicely. And it was wonderful. The family had a little league team. The family had a sponsored a car at the local racetrack in Lernerville.

Doug Austin (29:30):

We were very committed to the community and it made you feel good. And now all of a sudden, you, you step back and I’m not that anymore. And, you have this let down that you let your employees down, that they’re not working for the family business that they used to work for. Now they’re working for a big corporation. You feel like you’ve let down members of the community– even the people that you’ve never met. You go to Rotary and it’s not the same. You’re not a business participant anymore at Rotary. You’re just a guy, a person, being there. So emotionally it has been tough. And every day, as it goes beyond the sale, it gets a little bit more emotional because you just don’t feel like you’re special anymore. Not special in the fact that you don’t have the ability to help people. You’re just one of the people in the crowd, one of the people at Walmart. People aren’t coming to you and saying, hey, can you do this for our charity? Can you do this for us? Because you just don’t have the resources of the company anymore because people were looking for the company to do things for them. I still do personal things for people and charities, but there’s just that feeling of, it’s just an emotional letdown.

Laurie Barkman (30:56):

It’s an identity thing too. Isn’t it? Your identity for your family, even your name, your first name is James, right? So you literally have the company name on your door, so to speak, and there’s a disassociation that’s never been there before. And now it is. And that is a disconnect that you probably, as you said, it’s something that you’re learning to live with. I can imagine the employees of the company, maybe there were very long-term employees and they went through some emotional changes too, did you talk to people who work there? How did they feel about it?

Doug Austin (31:30):

Yeah, we tried to treat everybody like family. We would go to weddings. We would go to birthday parties for their kids, and now all of a sudden that stopped. We still keep in touch with a lot of our employees. We have a group that gets together all the time from the office and some of the folks that were in the production room and we go out and eat wings, or we’ll go bowling or something. And we try and do that every month or so to try and just keep the family atmosphere going. We still get invited to birthdays and weddings and things like that. But as they continuously retire, move away, the family keeps getting smaller and smaller. But the one thing that was really a strange thing, when you grow up in the business, you don’t think about things. But when I would go out, people would say, well, you’re from the Austin Bleach Company, because our name was in every grocery store in Western Pennsylvania. People just associated you with the bleach and the name. You became kind of a celebrity, even though you didn’t feel like a celebrity. Every time I’d go into a grocery store, I walked down the bleach aisle just to check on things, to make sure everything looks nice. Now I avoid it because it’s not my bleach anymore. Even though they use our name still, it’s not mine anymore. And it’s not my brother’s, it’s not my cousin’s. And so it’s a painful experience.

Laurie Barkman (32:56):

I’m sorry to hear that it’s painful. Maybe from the outside, we hear about the sale and we think, oh, isn’t that great for the company? They all made so much money. They’re going to go sit on the beach and drink Mai Tais. And I think the story that you’re sharing quite authentically, which I appreciate, is that it isn’t always balloons and unicorns. Hopefully financially your family appreciated what it’s done for you. But there’s a what’s next there, right? You’re not ready to retire. You want to pursue your next. I understand your brother is still with the company. Is that correct?

Doug Austin (33:32):

That’s correct. They kept him on. He seems to be one of the only people in the country that knows how to make bleach. So they’ve kept him on and he’s very good at what he does. I keep asking him when he’s going to retire and he keeps changing the date, but who knows.

Laurie Barkman (33:48):

Who knows? Yeah. So tell me about you in terms of your next and thinking about your strengths and your problems to be solved. This is something that I think is really important for everyone. Not just people who are selling their business, but there’s a lot of people right now who are really trying to figure out their next because of the economy. And I personally am too, I think it’s a great opportunity. And I work with clients to help coach them on finding their next. What are some of the things that you’re doing to shape that next thing for you, your next chapter?

Doug Austin (34:22):

Well, my dad always taught us that we should always have another plan. When you grow up in a family where you’re always working it’s hard to just stop. I haven’t been able to do that. So I’ve actually been out looking for jobs, and it’s really hard to take somebody who has run a factory and owned his own factory and plug them into somebody else’s factory, or into their business. I’ve been told many times that at 58, I’m too old, I made too much money, even though we never paid ourselves a lot of money, and that I have too much experience. I thought as soon as we walked away from the business, getting a new job would be a piece of cake and it hasn’t been, it really hasn’t. As I look at it, I can understand these other businesses there might be this fear that while he’s bringing all this experience and he’s going to try and change our business, or he’s going to try and change the dynamics.

Doug Austin (35:15):

So finally, that next step is a very difficult thing to do. And if I were to give somebody advice, that’s in the same position, just stay at it. It’s going to take a long time. And in fact, as I talked to other people who were in the same situation, it takes nine months. I was told that the average is nine months, but I just talked to somebody the other day that said it took them 18 months. Because you have to find the right fit. You don’t want to go down to the Get Go and get a job and do that because there’s that ego thing involved where your friends from the neighborhood will see you working at Get Go. Not that you have to, you want to do something. It’s not that what they really think, it’s just how you feel inside. You feel like you’re always striving to better yourself and that’s the hard part. Finding the next niche is going to be the hardest part for me.

Laurie Barkman (36:20):

Understandable, understandable. I think it’s a great place to start with, looking at what makes you happy, what you feel where you are at your best, adding the value in your career, what lit you up. Given that you’re an ex-prosecutor, an ex-litigator and an ex-street salesman, as you describe yourself in your bio, there’s a lot of really great skills in there. I look forward to continuing our conversation offline about what your next might be, Doug. So last question for you, I like to ask all of my guests, if they have a favorite quote about entrepreneurship.

Doug Austin (36:58):

I do. In fact, I wrote it down and I have to get my glasses on so I can read it.

I found this in a book written by Burton Folsom called the Myth of the Robber Barons. He said in talking about the succession of one generation to the next, “an inheritance can be transferred, but entrepreneurship, talent and vision cannot be.” And that to me that says it all.

I mean, my great grandfather was an entrepreneur. He had a vision and he passed it on to his next generation. Where my grandfather became an entrepreneur and had a vision, my aunts didn’t, but that created the family problem. Then we go to my father, and my father and his brother, my uncle, they became entrepreneurs. And that has been instilled in us. And I see that same entrepreneurial experience and vision in my brother and my cousins and myself. But I have also known family businesses where the next generation takes all the money and spends it. And in the end they don’t have anything because they never had the entrepreneurial vision. And that is the most important thing to continue family businesses. How you instill that in your next generation, I don’t know how you do it. Luckily my dad and my uncle did, so we were able to continue on the way that we did. To me, that one little quote says it all.

Laurie Barkman (38:32):

It does. And your company lasted about 130 years, which is more than twice the length of an average, company family business. I read it’s like 60 years- the mean age of family control. So already your family business has exceeded expectations there. I also read that about 3% of all family businesses operate at the fourth generation or beyond. There’s a lot to be proud about for James Austin and what he created and what your family led. I also read in your bio that it’s all about the “sale.” I think that’s a great spot to end because I think for this show and what you’ve shared, and your experience, and what you learned, it was about the sale. And then ultimately that’s the next part of your story- it is because of the sale of the company.

Doug Austin (39:22):

Yes. I would agree with that. I always think that a family business is a gift and it’s given to the next generation and it’s what the next generation does with it. And unless you learn the nuts and bolts of it and, and can take it to the next level, it will not progress. And that’s what the next generation has to learn.

Laurie Barkman (39:43):

On that note, we’ll wrap up. Thank you so much, Doug, for being here today and sharing your insights on Succession Stories.

Doug Austin (39:51):

Thank you, Laurie. I really appreciate the time and good luck to you.

Laurie Barkman (39:56):

Thanks for listening. I hope you enjoyed the episode. Three things before you go:

1. Follow Succession Stories Podcast on LinkedIn. Join the community to share feedback, submit questions, and ideas for future episodes.

2. If you want to develop a roadmap for your business to innovate, transition, or grow, let’s talk.

3. Hit 5-stars in Apple Podcasts and share with friends on GoodPods if you enjoyed the episode.

Thanks again for tuning in!

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