Millennials in the channel: Planning succession in an aging channel

This is part three of a CDN series on millennials, the IT skills shortage, and the evolving workforce, which will include five articles. Stay tuned to CDN for follow-ups exploring the role of higher education and women in IT.


Steve Conaby is what some in the IT industry dream of being.

While there are many his age or younger that can say they lead successful startups, at 33 years old, Steve Conaby is, perhaps, one of the youngest presidents of an established Canadian channel company.

It probably helps that Conpute Corporation, the Oshawa, ON-based solution provider and MSP that Conaby helms, is a family business.

Since it was founded in 1969 under Conaby’s Stereo, whose name gave away the “hip technologies” lining the shelves at the time, the company has moved completely into the B2B space.  All the while, it passed through three generations of Conabys, from Steve’s grandfather to his father Don Conaby, to him.

It is safe to say that the Conaby family is familiar with the subject.

But let’s get a few facts and figures out of the way.

You may have read in Part 2 of this series that 70 to 80 per cent of the channel, not just c-level executives, are part of the baby boomer generation. This places the vast majority of employees into the 51 to 69 years-old bracket – at the cusp of retirement.

While it’s hard to draw direct links, there is a new trend for the industry to move towards mergers and acquisitions, with at least six such deals taking place in the Canadian channel over the past two months alone.

“A lot of people who started computer businesses in the 80’s and 90’s are now getting to an age where they would be looking to part ways,” Conaby said.

To him, where large corporations have more structure in place to determine lineage for its leaders, succession planning is a challenge for smaller companies.  His own father, who Conaby said tried to never pressure him into any particular role, considered selling off the company in the event none of his children wanted to buy him out.

Fortunately, Conaby did.

In the summer of 2010, Conaby’s father brought the family together.  At the age of 57, Don Conaby announced his plans to retire in three years’ time, and proposed that either the family purchase the business from him, or he could look to sell to a third party.  With help of his sister, who is now a silent partner, Conaby decided to buy.

“The conversation was happening early enough so that it wasn’t a surprise,” Conaby said.  He explained that, in his case, having three years was a good amount of time to plan everything from business valuation to third party assessments, setting company pricing, negotiating terms, determining cash versus shares, etc.

During that time, Conaby gradually took on more roles from his father, including the on the services side.  At every step of the way they communicated about what he wanted to take on.

“We were very open about it,” he said.  “What I found was … I would go to him and ask him [questions], and he would obviously give his opinion, but around that time, I just started making some of those decisions.  He let me do that. As long as I reported my metrics back to him, he gave up the reins.”

In all, Conaby said he had about two years of making business decisions before taking ownership.

For the most part, he said, the three-year transition was very smooth.  For the staff, it was business as usual, especially since he and his father were on the same page.

Conaby said that while the three years was right for his company, it’s not necessarily the rule.

“It has to be what’s right for the business. ,” said Conaby.  “You don’t want to rush it, but you don’t want to let it drag too long either. You want it to be a constant, always talked about, always moving through the paces, through all the steps.”

Similarly, he said, it’s important that businesses are aware of the level of challenge a transition like this poses and to get outside help such as from lawyers or accountants – to make sure it’s not done “on a napkin,” Conaby said.

It’s also crucial that there aren’t “two heads on the snake” with the exiting and incoming executive pulling the company in different directions.

Lastly, Conaby said, companies need to figure out what the role of the owner will be. Whether they will stay on in some capacity or not should be explicit and well-documented.

“You’re talking about somebody’s baby,” Conaby said.

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Jim Love, Chief Content Officer, IT World Canada

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Dave Yin
Dave Yin
Digital Staff Writer at Computer Dealer News, covering Canada's IT channel.

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