SHOULD I HIRE A GENERAL MANAGER RIGHT AFTER ACQUISITION TO START REPLACING OWNER/OP?
[Edited for clarity]
Either hire an industry experienced GM or promote a GM to start replacing the owner.
The goal is to have a new GM in place as soon as possible to start take over day to day operations from the current owner. So why wouldn't I hire a GM to start immediately?
Additional details
Company isn't complicated. Mostly service related with a diverse client base.
The owner will stay on for 2-3 months for training.
Do you know who and what to recruit for to be a good fit in this position (when you’re new to the business)? How long is that going to take? How do you plan to explain your company and your vision?
How'd your employees take having a new owner? How will they feel when you bring in a GM to run the day to day when both of you are new to the business?
I don’t know your thesis behind buying your company, but I’d recommend that you should spend time learning the company and running it before you make a material decision like bringing in a GM.
What is your intent with this business? Do you intend to be an active owner/operator? Or an absentee owner so you can do other things, too?
Now you’ve added that you brand new to this business and you’re willing to give up to 15% of you let equity to some who will work for you right out the gate.
Again, I don’t know all the details, but there’s many assumptions in poaching a competitor’s GM. Like: will this person fit your business; fit with you; are they actually good at what they do? Do they have a proprietary matters or nonsolicitation agreement because those have some teeth?
And just like that, you’re willing to give them equity?
That’s a lot of risk you’re taking on right away when you’re brand new. You’re already taking on enough risk buying the company, inheriting someone else’s problems and culture, and needing to learn while getting the buy-in from your employees and customers.
As I’ve noted and others too, spend your first year learning your business, getting to know your clients, and keep the train on the tracks. That’s my recommendation, which shows I haven’t changed my position.
Hope i'm on target here for a search fund.