Are You Facing A Lack Of Family Succession For Your Business - Your Legacy?

Are You Facing A Lack Of Family Succession For Your Business - Your Legacy?

You are not alone!  This phenomenon, termed "Silver Tsunami", is affecting the Boomer generation (born 1946-1964) and even extends to Gen X (demographic cohort born between approximately 1965-1980).  Business owners are transitioning their companies because their children - the next generation - are showing little to no interest in taking over the family business.  Hence, this major economic trend known as the "Silver Tsunami".  While this number fluctuates, Boomers and Gen X are at or nearing retirement age.  Sources like Exit Planning Institute (EPI), Project Equity, PwC, and Gallup paint a vivid picture that tens of thousands of U.S. businesses are sold annually due to this scenario, with projections of 300,000 - 500,000 sales per year over the next decade.

Key Statistics On The Scale - Breaking It Down

Here is a summary of the most relevant 2023 - 2025 data, focused on family succession failures leading to sales:

Annual Businesses for Sale:

About 200,000+/- small businesses are listed for sale each year.  About 30% sell successfully, leaving 70% without a viable plan.  This may be attributed to no family successor.

Source - Exit Planning Institute (2023); BizBuySell (2025)

Boomer-Owned Businesses at Risk:

2.34 million small businesses owned by Boomers (employing 25M+ people); 70% plan to retire or transition in the next 10-20 years, yet approximately 54% aim for a family handover (with low success rates).  It can be inferred that 1.6M are at risk, projecting 80,000-160,000 annual sales/transitions.

Source - U.S. Census Bureau; EPI (2023); Project Equity (2025)

Family Succession Success Rate:

Theoretically, if only 30% of family businesses survive to the second generation; 12% to the third;  the remainder 70% close, sell externally, or fail - due largely to lack of heir interest or qualifications. 22% cite "no willing to Next Gen".

Source - SBA (2022); North America Family Business Report (2023)

Owners Planning Sales:

About 37% of owners plan to sell their company(s) within 2 years; 55% are motivated by retirement with no family plan.  Among employer-owners nearing retirement, 22% plan to sell/transfer (vs. 27% closing).

Source - BizBuySell (2025); Gallup (2024)

Lack of Planning:

Considering that approximately 61-78% of family businesses lack a formal succession plans, 58%-60% of Boomers (and some Gen X) have no plan at all, thus forcing a sale or closure when kids opt out.

Source - PwC US Family Business Survey (2023); Wilmington; Trust (via CNBC, 2019-2025 updates)

·      Projected Total Impact:  EPI estimated that 73% of U.S. privately held companies (a $14 trillion opportunity) will transition in the next decade.  If subtracting family successes (~30%), this suggests ~5-7 million businesses could sell externally, with family disinterest as a top driver.  Annually, this is ~300,000 - 500,000 sales (a conservative estimation: 7.2 Boomer owners over 15-20 years, less 40% family/exit).

Why This Is Happening

·      Generational Shift:  Next Gens (Gen X, Millennials, Gen Z) prioritize work-life balance, flexibility, and purpose over traditional family legacies.  Only 18% of next-gen family members plan to sell, but current owners underestimate this (8% expect it).  A 2025 Gusto study shows Gen Z participation in family businesses up 13% YoY, but it is still low overall.

·      No Plan = Forced Sale:  With approximately 49% of owners exiting in 5 years and 68% seeking advice but lack teams, sales become the default when family says no.

·      Economic pressure:  Boomers hold 65% of employee businesses; retirement is key for 55% of sales, but low liquidity forces sales over closures.

Broader Implications

·      Job Losses:  Up to 25M jobs are at risk if 70% fail to transition smoothly; indicating that one in three Americans relies on Boomer-owned business income.

·      Alternatives Gaining Traction:  25%+ of owner eye employee ownership (e.g., ESOPs) to preserve legacies without family involvement.

·      Regional Note:  In locations like Minnesota, 29% of businesses are Boomer-owned and changing hands soon.

These figures are U.S.-centric (global data is sparser but similar, e.g., 1/3 of Swiss SMEs vanish due to no buyer/heir).  For tailored advice, consult EPI or Project Equity.  If you want to talk about a succession/exit plan for your business, please contact me, Christina "Chris" Jones with EMergers & Acquisitions Private Equity, at Chris@MAPrivateEquity.com or (214) 390-3277.

Article Sources: Exit Planning Institute (EPI), Project Equity, PwC, Gallup, Christina "Chris" Jones, and Grok.