What impressed me most about her was that we’d just had a conversation over breakfast that was far from what you would expect from the chairman of a huge corporation. She seemed comfortable being a normal person when she was with her daughter and granddaughter. When she took the front of a room, the business persona came forward.
“I know you have a full agenda planned for today, so I’ll just get to the point. I think you’ve found a unique niche in the wealth-management market. What I hate about most wealth-management companies is that they cater to institutional clients like state employee retirement funds or large corporations. If you look at their list of clients, you’ll see that big institutional clients account for the majority of their revenues.
“What you offer is much more personalized. It covers all aspects of financial management that wealthy people genuinely need, and not just people in the entertainment industry. Potentially, and in some cases actually, it also covers virtually all nonfinancial aspects of personal management. Personal and public relations services are the prime examples of that. I hadn’t thought about the gaps in the services I had until my granddaughter came to me with what you had to offer. I’ve been using the services for the past few months and find the business model intriguing.
“My hat is off to you all for taking your business to this point. What I’m going to propose is that we take this to an entirely new level, with my help. To be frank, I don’t think David has the desire to take the reins and drive this business to its full potential right now. Maybe in ten or fifteen years, he’ll have the background and time to take this on, but not right now,” she said and turned to me.
“This isn’t meant as a slam on you personally, David,” Grace said. “I understand why everyone partnered with you. You were their cash cow. In effect, you offered them an opportunity to work independently, with your father and Caryn acting as traffic cops and keeping everything balanced and in perspective.
“I’m going to be brutally honest with you. You, as the owner, have not been keeping an eye on things. Not that anyone has done anything wrong or taken advantage of you, but I know from experience that someone with your leadership skills would make a difference. You need someone to take that role to expand the company.
“I also get why you haven’t been actively involved. You felt if you threw money at it and put the right people in charge, that it would take care of itself. You have too much else occupying your time to run a successful company. To this point, you’ve been lucky, and from what I can see from the numbers that Caryn shared with me, it has grown faster than expected.
“That in and of itself will eventually catch other people’s attention, and not necessarily in a good way. It won’t be long before your business model is hijacked by someone better prepared to take advantage of it.
“Eventually, inattention on your part and the lack of a steady hand on the reins will almost certainly result in something bad happening. It will be something that you really don’t want or like, and it will occur somewhere down the line, though perhaps not for years.
“As I said, I’m being blunt. But I’ve also seen it happen, and the effects, both personal and financial, can range from troubling, to significant, to severe, all the way up to devastating.
“Finally, rapid growth is good, but only if you know how to manage it. Too often, a small company like yours can’t keep up and maintain quality when it starts to take off. That is something I specialize in,” she said.
I was a little offended that she referred to us as a ‘little’ company. But when you looked at her parent companies’ yearly revenues—in the range of multi-billions of dollars—we were little by comparison.
At that point, she went into the details of her proposal. Grace would end up owning 51% of the parent company while I retained 9%. Her projections showed that within ten years, my 9% stake would be worth more than my current 60% share.
I would retain ownership of the company that handled my acting and modeling income. I would also keep my restaurants, farms, and my mom’s real estate company since they didn’t fit in with the wealth management concept.
We took a break, and I pulled Caryn, Dad and Mom, Uncle John, and Grandma Dawson together in a conference room. I guess I wasn’t surprised when Brook and Scarlet joined us.
“I have a feeling this is a big deal, and I might not want to sell. If Grace sees the value in what we are doing, are we crazy to let it go?” I asked.
“He makes a good point. My grandmother wouldn’t have worked on this if there wasn’t something in it for her. I’m frankly a little surprised she didn’t just start from scratch and do it herself,” Brook shared.
“That was good. You should be in sales,” my mom said. “She just subtly did a takeaway where she pointed out that her grandmother didn’t need us.”
