Founder Exit Timing and Intergenerational Succession of Family Businesses: A Multi-Case Analysis Based on Residual Control Right Transfer

The core of intergenerational succession in family businesses lies in residual control rights, which represent a dynamic inheritance process that unfolds over time through gradual power transition. This paper investigates the intergenerational succession process, focusing on founder exit timing and its matching conditions, rather than merely discussing the duration of succession. It primarily analyzes how founder exit timing and supporting conditions affect the transfer of residual control rights. Through case studies and comparative analysis, the study reveals that neither excessively early nor excessively delayed founder exit can support smooth power transition. The so-called short or long succession duration is an ex-post observation derived from exit timing choices. Successful intergenerational succession requires well-timed founder exits matched with three critical matching conditions: tacit knowledge transfer, social network inheritance, and a willingness to delegate. Family businesses should therefore schedule founder exits strategically, avoiding both premature and delayed handovers.