Small Firm Exchange

I have just gone throught an Ownership transition and sold out my stock in my firm. During the process I learned that all the information in AIA's data files are for medium and large firms. The SFRT needs to initate discussions, panels, programs, manuals, and standard SOP's for the small firm where the name on the door is the greatest firm asset.

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Jeffrey Rosenblum FAIA
Rosenblum Coe Architects, Inc.
Charleston SC
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This is an excellent point.

Not that I am anywhere near buying out of my company, but I think your recommendation is brilliant.

Greg

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Gregory Houston AIA
Principal
GMH By Design LLC
Aurora CO
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I wonder if Rusk O'Brien Gido + Partners (http://rog-partners.com/) could / would be interested in working with you. I do know that they have just published a new A/E Business Valuation and M&A Transaction Study, but have no idea how many small firms might be included. Nonetheless, the fundamentals remain the same: we are trying to sell intangible assets.

If the name on the door still does most of the rainmaking and designs most of the projects, the value of the asset leaves with that person. However, if the name on the door has spent much time hiring & developing very good design staff and involved them fully with client relations, then much of the value can remain in the firm.

Hey Jeffrey, thanks for your post.  I would be interested in these resources as well, but I am coming from the "other side".  As I begin transition into a firm where only 1 of the "names on the door" is still active in the business, I wonder how it will be when I am the majority stakeholder, then sole owner with no connection to the previous name(s). 

I'm sure you've also seen the tendency of clients, engineers, etc to call firms by their former lengthy title (i.e. Brittain, Thompson, Bray, Brown instead of the current name BTBB, inc.) even years after a name change has occurred.  Ultimately, the history of a firm matters because of the legacy those names left.  I pray that I can continue that legacy and improve on their successes.  After all, as Isaac Newton (and others) have remarked "We stand on the shoulders of Giants..."

I hope that the SFRT takes this as a call to action, especially considering the number of smaller firms that have emerged from the Great Recession and the major shift to occur as the Baby Boomer generation heads into retirement.

Thanks again for your input.

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Will Stanford, AIA + LEED Green Associate
BTBB, Inc.
Macon GA
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At the risk of being seen as promoting my own services, people interested in ownership transition might purchase chapter 5 of AIA's Architect's Handbook of Professional Practice, which contains guidelines and case studies that apply to firms of all sizes.  I believe it only costs $19.95.  (Disclosure:  I authored this section but do not receive any royalties or payments for purchases.)  Rena Klein, FAIA, did an excellent job at editing this section.

The link is AIA Architects Handbook of Professional Practice - Chapter Sales 

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Michael Strogoff FAIA
President
Strogoff Consulting
Mill Valley CA
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Original Message:
Sent: 02-25-2015 11:58
From: William Stanford
Subject: Small Firm Ownership Transition

Hey Jeffrey, thanks for your post.  I would be interested in these resources as well, but I am coming from the "other side".  As I begin transition into a firm where only 1 of the "names on the door" is still active in the business, I wonder how it will be when I am the majority stakeholder, then sole owner with no connection to the previous name(s). 

I'm sure you've also seen the tendency of clients, engineers, etc to call firms by their former lengthy title (i.e. Brittain, Thompson, Bray, Brown instead of the current name BTBB, inc.) even years after a name change has occurred.  Ultimately, the history of a firm matters because of the legacy those names left.  I pray that I can continue that legacy and improve on their successes.  After all, as Isaac Newton (and others) have remarked "We stand on the shoulders of Giants..."

I hope that the SFRT takes this as a call to action, especially considering the number of smaller firms that have emerged from the Great Recession and the major shift to occur as the Baby Boomer generation heads into retirement.

Thanks again for your input.

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Will Stanford, AIA + LEED Green Associate
BTBB, Inc.
Macon GA
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I am a sole practitioner but am incorporated.  I have entertained the notion of joining with another firm or bringing in a partner.  I attended a seminar in Dallas, TX, hosted by the firm Dannible & McKee and Associates, Ltd.  They specialize in firm buy-ins, buy-outs, and valuations.  The seminar is extremely informative and explains how to establish a value for the firm history, the key man, past, current, and projected revenue, and give you other tips on transitioning.  You come away with case studies that you put a pencil to and a very detailed binder.  They will even come in and help with the valuation as a consultant and it is not that expensive.  I recommend anyone considering this path to attend their seminar.  They give several a year and are spread across the country.

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Brian McNew AIA
McNew Architecture, APAC
Shreveport LA
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