You’ve grown your business from scratch, seen success, but what now? For solo practitioners, it’s a nagging question. Whether or not you’re close to retirement, what happens to your firm? Does it disappear? How does it carry on without you? Today we begin explore ownership transitions and one firm’s experience. We start with a conversation with its founder; the second part will focus on the new team in place and their plans for the firm’s next chapter.
Nadel Architects’ creation story starts out as so many often do: A talented young person starts a company out of a house. In this case, the year is 1973, and the house is just outside Los Angeles. Through hard work, patience and skill, the founder, Herb Nadel, expands the business, transforming it into a highly regarded practice with a robust portfolio of local and international projects—everything from stadiums in China to hotels in Los Angeles and Chicago.
Early on, recalls Nadel, “I looked for a partner—I was young and scared to death—but could never find anyone I felt comfortable with.” As a result, the ensuing successes, the failures, the nuts and bolts of running a business all fell on Nadel’s shoulders. About seven years ago he began thinking about the future in earnest, both his and the firm’s. “I’d seen firms become unglued after the principal left,” Nadel explains, and he wanted to avoid the same fate. “They’d either die or evaporate. It’s a shame, and I didn’t want our marvelous portfolio and great reputation to disappear.”
Nadel turned to Bill Mandel, a San Francisco–based attorney who specializes in ownership transitions for architecture, engineering and design firms, and began exploring ways to preserve Nadel Architects. All was going according to plan when the downturn came. The firm, like so many others in the industry, took a hit. Nadel put his transition plans on the back burner as the company’s immediate future became the focus. “We essentially re-engineered ourselves,” Nadel now says of that time.
With the economy improving, Nadel again began planning for a transition—one that would offer ownership stakes to senior members of his staff. “We have marvelous people,” he says of the first group of new owners. “I selected them because they emerged as remarkably skilled in each area of expertise, and they balance each other.” In turn, when those new owners turn 65, they’ll begin selling their own stakes to a new generation. It’s a way of ensuring continuity and infusing the firm with fresh creative spirit and energy.
Even with the new ownership structure now firmly in place, Nadel doesn’t see himself leaving anytime soon. “I’m a feisty character,” he explains. “I expect to be around for a long time.”
Stay tuned for part two of our look at Nadel Architects, when we’ll hear from two of the firm’s new owners, Patrick Winters and Greg Lyon.