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BUSINESS Saturday 8 december 2018
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Invest in the company or retirement? More owners opt to save

By JOYCE M. ROSENBERG who's the company's key
Associated Press employee can be sidelined
NEW YORK (AP) — In John by a serious illness, hurting
Holloway's early years as an the value of the business.
entrepreneur, saving for his Or if patents are infringed
own future wasn't a priority. and once-exclusive prod-
"I invested a lot of money ucts are now sold by com-
into one of my first business- petitors, a company's value
es and came out break can plunge.
even at best. I am kicking Moreover, O'Brien says,
myself for not setting some when it's time to sell, buyers
of that money aside for re- might not be willing to pay
tirement," says Holloway, what the owner hopes for.
co-owner of NoExam.com, "You need to shore up your
a life insurance brokerage reserves in case you don't
based in Roswell, Georgia. get the sales price of your
These days, when his com- business that you want," he
pany's cash flow and prof- says.
its are strong enough, he Many owners couldn't get
takes money out of the their asking prices during
business and invests in a re- the Great Recession and
tirement account. its aftermath. Sales of com-
"I am trying to diversify — panies plunged and didn't
having all of my eggs in In this Monday, Dec. 3, 2018, photo, Shamila Nduriri, who owns Dalasini, an upscale jewelry recover until 2013; they've
one basket is stressful," Hol- company, poses in her Minneapolis apartment with some of her jewelry. soared since as owners fi-
loway says. Associated Press nally got the deals they
Saving for retirement hasn't wanted.
been a priority for many In a survey by insurer Na- 401(k). in Mountain Top, Pennsyl- However, many startups
small business owners over tionwide released in Octo- When Ron Lieback started vania. To help his company might not exist if owners
the years. They've hoped ber, 53 percent of younger his digital marketing busi- be more profitable, and hadn't plowed every pos-
to build their businesses, sell business owners — those ness, he began setting therefore help himself save, sible cent into the business.
at a huge profit and have born in the 1980s and '90s aside 10 percent of his own Lieback uses freelancers for "We invested everything we
a comfortable retirement. — said having a workplace salary. Profits from the com- some of ContentMender's made back into the busi-
While they've taken profits savings plan was important pany, ContentMender, are work. ness to get it past the tip-
out for homes and college for their retirement. Fewer reinvested into new tech- Owners who expect com- ping point of financial sta-
tuition, it was more impor- baby boomers, 39 percent, nology, but Lieback wants panies to fund their retire- bility," says David Gafford,
tant to reinvest earnings felt it was important. Older to be personally prepared ment are optimistic but who owns Fusion Creative,
into the company rather surveys show how boomers for the what-ifs. may be overlooking the a digital marketing firm and
than save for retirement. favored their companies "Something could crash fact that they and the a credit card processor,
But attitudes about saving over saving — the Small and our business could fail. business are vulnerable to both in Indianapolis. "Then
may be evolving after the Business Administration said You always have to have potential calamities, says we made the turn from put-
financial devastation of in 2006 that only about a that in the back of your David O'Brien, a financial ting everything back into
the Great Recession, when third of owners had Individ- head, so you need that adviser with Evolution Advi- the business to focusing
tens of thousands of busi- ual Retirement Accounts nest egg," says Lieback, sors in Midlothian, Virginia. on our personal and family
nesses failed. and 18 percent had a whose company is based For example, an owner goals as well."q

Marlboro maker places $2.4 billion bet on marijuana

Associated Press co companies is diving into Marlboro maker Altria by Constellation, which Friday.
NEW YORK (AP) — One of the cannabis market with Group Inc. is taking a 45 makes Corona and other Rapid growth in the can-
the world's biggest tobac- a $2.4 billion buy-in. percent stake in Cronos beverages, was the larg- nabis market is expected
Group, the Canadian est to date by a major U.S. to continue as legaliza-
medical and recreational corporation in the canna- tion expands in the U.S.
marijuana provider said Fri- bis market. and social norms change.
day. Whatever hesitation larger On Tuesday, ultra-con-
Altria will pay another $1.4 corporations in the U.S. servative Utah became
billion for warrants that if had about entering the the latest state to legalize
exercised, would give the cannabis market appears marijuana use for medical
Altria a 55 percent own- to be fading if there is a fi- purposes.
ership stake in the Toronto nancial justification. Consumers are expected
company. Altria's huge investment to spend $57 billion per
That would mean Altria's lit up shares of cannabis year worldwide on legal
investment would be in the companies that have be- cannabis by 2027, ac-
same league as the $4 bil- gun to set up shop in Can- cording to Arcview Market
lion spent earlier this year ada, where recreational Research, a cannabis-fo-
by Constellation Brands to use was legalized this year. cused investment firm. In
In this July 17, 2015, file photo, store manager Stephanie Hunt acquire shares of Canopy Shares of Cronos Group North America, that spend-
poses for photos with a pack of Marlboro cigarettes, an Altria Growth Corp., another Ca- Inc. jumped 31 percent ing is expected to grow
brand, at a Smoker Friendly shop in Pittsburgh. nadian pot producer. and neared an all-time from $9.2 billion in 2017 to
Associated Press The August investment high at the opening bell $47.3 billion in 2027.q