Bring in outside capital without losing your business: write the buyback in

You are weighing an outside investor who can fund succession, but the deal can also become a permanent claim on the family business. Treat the capital as a timed bridge and write the buyback into the agreement before the money arrives.

New Mountain Capital announced it had left its minority position in Lincoln Investment following the leadership change, with the Forst family and advisor shareholders retaining complete control. Lincoln Investment reported fee-based and brokerage assets of about $63 billion. Its fee-based business increased by roughly 75 percent after New Mountain Capital invested in 2020. In June 2026, Kathy Leckey became chief executive officer of Lincoln Investment under a succession plan, and Ed Forst moved from the CEO role to executive chairman.

The sequence is the template: outside capital can strengthen a transition while the family keeps control, but only if the return of the shares is planned before ownership pressure changes hands.

Start with the exit, not the money

Most family owners begin by asking how much capital they need. The better question is what ownership should look like when the next generation takes over. If the answer is full family ownership, the agreement must contain the return plan.

Outside capital can fund a rebuild, a leadership transition, or a product line that needs patient money. It can also become a permanent claim if the exit is left to goodwill. The investor may be patient for a few years. Owners must be patient for decades.

Write the exit into the agreement before you sign. Name the milestone that triggers the buyback, the date when the family must be ready, and the price method that both sides can verify. If the agreement does not say how the family gets the shares back, the family has already given up part of the business.

Fund the buyback before the milestone is reached. Owners should set aside cash, reduce personal withdrawals, or arrange a separate financing line. A lucky sale should not be the funding source for the return.

Keep the exit visible in the deal

• Sell a minority stake only. The family still controls the board, day-to-day decisions, and the long-term ownership plan. The capital provider gets cash, not command.
• Set a fixed term. The agreement names a review date and an exit window. Owners know when the term ends, and the investor knows the family is not asking for a permanent seat.
• Complete a succession milestone. The finished state is a named chief executive who is trained and able to run the business without the founder. The exit is tied to that proof, not to a vague promise.
• Fix a buyback price formula. The price is tied to a stated multiple, earnings measure, or valuation date, with a cap and a floor. Both sides can calculate the number before the market moves.
• Add governance guardrails. The investor gets information rights and a board seat, but no veto power over succession, key hires, or the buyback. Owners keep the keys to the long-term plan.

The usual mistake is to accept a minority stake and then forget the exit. The investor’s patience is not the family’s patience. If the family cannot buy back the stake on schedule, the investor can force a sale, and the business stops being a family asset.

Make the capital pay for itself

Outside capital should do more than fill a short-term need. It should improve the business enough that the buyback is affordable. Use the money to strengthen operations, deepen the leadership team, and expand the parts of the business that compound over time for the next owners.

Do not spend the capital on a lifestyle upgrade that the next generation will have to repay. Spend it where it raises value, eases the successor’s job, strengthens the family’s position, and supports the family’s balance sheet when the buyback date arrives.

The next generation should inherit ownership, with the buyback price already agreed.