Polish Entrepreneurs Increasingly Open to Selling Businesses Amid Succession Wave

A significant shift is underway in Poland's business landscape as a wave of successions, or transitions of ownership and leadership, gains momentum. Many family businesses, founded in the boom years of the 1990s, now see their founders contemplating their next steps. This evolving dynamic is highlighted by a recent EY study, which indicates a growing openness among Polish entrepreneurs to selling their companies.

The study reveals a notable decrease in founders who explicitly rule out selling their businesses. While a substantial 57% still express this sentiment, it marks a decline from previous years. This trend is particularly striking given that a third of founders aim to exit their businesses within the next 5 to 10 years, and less than a third of those plan to pass the reins to family members. This suggests a growing acceptance of external solutions for business continuity.

Paweł Bukowiński, managing partner at EY-Parthenon Poland, notes that while Polish entrepreneurs are increasingly considering exiting their firms, they also show a strong inclination towards capital recycling, selling mature assets to reinvest in new, more profitable ventures. He also points out that Polish family firms lead the region in the financial education of their heirs. However, they tend to reinvest less of their profits compared to their regional counterparts, focusing more on structural asset protection through succession planning and corporate governance.

The formalization of succession strategies is also on the rise, with one in four family businesses now having a formal plan, a slight increase from the previous year. Despite this, informal discussions among family members remain common, though fewer respondents now cite this as their primary method. The proportion of companies that have not addressed succession planning at all has remained static, underscoring the varied approaches to this critical business transition.

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Our companies are increasingly moving towards structural asset protection, based on succession planning and corporate governance principles, prioritizing education and formal planning over simple reinvestment of funds, which indicates a mature approach to long-term capital management.