With retirement on the horizon, it was becoming clear to John Kegarise that Baron Insurance Group might not stay in the family.
His only son, the company’s heir apparent, left the Manheim firm after two years to pursue church work.
“It blew my candle out, to be honest with you,” Kegarise said, recalling the time nearly 10 years ago when that hope for family succession was snuffed. “I floundered for probably a year and a half.”
There seemed few other options: His two daughters hadn’t given any indication that they wanted to own the firm he bought in 1996. Their respective husbands were in careers light-years away from selling insurance in a small town.
“When you develop a business, you always in the back of your mind are thinking, ‘What am I going to do with this?’ ” Kegarise said. “You want to have it go to your family — a small business — if you can do that ”
Kegarise was learning firsthand that passing a family business down to the next generation is fraught with difficulties.
He was about to give up and start looking for an employee who could be groomed to take over. Short of that, he would sell the firm — something he saw as a last resort.
Daryl Leisey, who began advising Kegarise at the time, told him: “Not so fast.”
Kegarise’s story has come to illustrate that keeping the lines of communication open, being leery of unspoken assumptions, and understanding that things aren’t always what they seem can lead to an unexpectedly positive result.
Soliciting their thoughts
Leisey is a partner with North Group Consultants in Lancaster, which works with a variety of organizations on leadership development and transition.
He suggested that Kegarise formally solicit each of his children’s thoughts on the business before going in a different direction.
“In a lot of situations, there’s a lot of assumptions about things,” Leisey said.
So that’s what Kegarise did. In the resulting conversations, he learned that the son who had left the firm still felt certain about his choice. A daughter and son-in-law in Philadelphia had no desire to move back to Manheim and work in insurance.
That left daughter Ellen and her new husband, Chris Vogt, who had recently moved to Seattle so he could take a dream job as a General Electric engineer, working closely with Boeing. Getting him to trade that to run a small insurance company in Manheim seemed unlikely.
Kegarise and his wife made the trip to Seattle anyway, and over dinner on the patio, Kegarise made his pitch. He got an emphatic “No.”
“It wasn’t what he said, it was how he said it,” said Kegarise, recalling Vogt’s response. “Insurance?! What?! Why would I want to be an insurance agent? It was almost like I embarrassed him to ask that.”
And that’s how things stood.
Until they changed.
One year later
About a year after what is now kindly referred to as a “brush off,” Vogt got back in touch.
Though he was part of leadership programs at GE, Vogt said he was starting to feel like a cog in a big machine.
“I felt like I should be authoring the book versus reading the pages,” he said. “At GE I was just reading the pages. I was following the playbook.”
That new openness prompted Kegarise to start telling him more about what it meant to sell insurance, with Vogt becoming interested in the notion that it was about building relationships.
“He just helped me understand the components: the entrepreneurship, the impact of community, the relational component, and the impact you can really have on other people’s lives,” Vogt said.
While it was ultimately a decision made for business reasons, Vogt said the prospect of raising a family in Manheim instead of Seattle was also a factor in the eventual move.
Today, the 36-year old Vogt and his wife have three children ages 6 and under and live in Penn Township.
6-year transition process
Vogt arrived in Manheim with his wife in January 2009, ready to begin a new career in business with his father-in-law.
“It’s one of those reminders in life that no matter how well you think you can author your future, there’s a path that — if you’re willing to go down it and be faithful and submit to what that path is — the outcomes will be way better than whatever you could have written,” Vogt said.
But he wasn’t just given the family business.
Instead, he started on a six-year transition process that began with his learning the ropes while slowly taking on more responsibility.
And while it has been a major learning experience, Vogt said he’s been able to apply some universal business principles.
“It’s about people, and it’s about problem-solving, “ he said. “How do you logically break down a complex situation into a basic way to solve problems?”
Vogt was also learning that insurance is a very competitive industry in Lancaster County, and the 11-employee firm will need to grow to survive, possibly by buying other firms.
“The day we become complacent is the day we start closing,” Vogt said.
Through it all, Vogt says, he has never questioned his decision to leave GE, adding that he’s found what seems like a perfect career fit.
“When someone is in the place they know they’re supposed to be, there’s no doubt. I don’t say that lightly,” Vogt said.
Last New Year’s Eve, the family held a formal “passing of the pen” ceremony at the Cat’s Meow in Manheim to commemorate the official transfer of ownership from Kegarise to Vogt.
After the long and uncertain road to that transition, Kegarise says he couldn’t be happier.
“It’s a great satisfaction for me, knowing that it is turned over to someone who feels that this is where he is called to be,” said Kegarise, who remains a consultant. “That’s exactly what I want. It couldn’t be a better match.”¶