Plan for the Future
Contingency and succession planning are critical to your advisory firm's success. Review the wealth of information.
All Articles
Smart Recruiting Can Secure Your Succession
Added on November 2013 in Plan for the Future
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Summary: Industry observers say the extent to which independent advice firms can keep stealing market share from big-name rivals like Merrill Lynch and Morgan Stanley depends on their ability to transition to next-generation owners. Extending an established trend, indie RIA assets grew by 19% last year, while AUM at the four biggest brokerages were essentially flat, according to Cerulli Associates. Bigger RIAs can merge with approximate equals or acquire smaller firms to see them into the middle of the century. But for smaller RIAs, the best way forward may lie in smart recruiting.
Buying a Practice? 5 Important Valuation Questions
Added on November 2013 in Plan for the Future
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Summary: Practice acquisition (acquiring a retiring advisor's practice) is an incredibly lucrative way to grow your business exponentially, and as advisors age, there will be ample opportunity for younger advisors to acquire practices. In the next 10-15 years, there's going to be a glut of “for sale by owner” practices, but the simple fact is that they are not going to be worth the multiples that are being thrown around now. Here are five things to ask the selling advisor and the appraiser before you buy a practice.
The Fatal Succession Planning Mistake
Added on November 2013 in Plan for the Future
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Summary: The scope of the succession problem in the independent advisory industry is well-documented. Baby boom generation of advisory firm owners are on the brink of retiring over the next 10 years or so, with some sources estimating that as many as 50,000 of their firms—and $4 trillion in client assets—will be changing hands or closing their doors. The vast majority of the owners of these firms would prefer to transition ownership to their junior partners in an internal succession. Yet very few have taken steps to make this happen, even at this late date.
Don't Sell Your Practice, Redesign it
Added on November 2013 in Plan for the Future
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Summary: A great deal has been written about succession planning over the last two years. Most of it focused on selling your practice to either a younger version of yourself or merging into a larger firm and transitioning your clients over a period of time. Clearly they are options, but they may not be the best options. We believe you are better off redesigning your practice to accommodate your lifestyle – perhaps a retirement lifestyle – and continuing to run your practice for many more years before considering a sale.
Realizing your ideal model
Added on November 2013 in Plan for the Future
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Summary: Best-managed advisory firms are constantly innovating, revising their business plans and seeking to drive the next iteration of growth. What is different for advisory firms now is the pace of change is so fast that standing still is not an option – advisors may simply be lapped by the field!
