Every day Queenston speaks with advisors – young, old and somewhere in between. Everyone is looking for something or else they would not be talking to us. This is great as it provides us with a tremendous cross section of advisors, platforms and business models as well as transition opportunities.
Most conversations involve inorganic growth – acquisitions, mergers and partnerships. The Industry is so competitive organic growth has slowed for most advisors. REMEMBER – if you are not growing you are moving backwards. Many advisors are now on cruise. They have worked their asses off and are now in a lifestyle business model i.e. spending more time away from the office. They may have adopted the “Do Nothing” exit strategy.
If you are looking at acquiring advisors with an Exit Strategy – here are some ideas:
- Know your “hook” – what makes you special
- Offer expertise in an area your target may be lacking – helping them
- Play the “what if you get sick” card – and your solution
- Prove you have financing in place (for real not just “oh my Dealer will finance”)
- Prove that you have the infrastructure to take on an influx of clients
- Look for different but complimentary businesses to invest in (not run but own and achieve synergies)
- Think outside the box – especially when making a deal
- Always think win – win – win
If you are an Advisor considering an exit strategy – here are some ideas:
- Please please please know the value of your firm and your alternatives
- Know the terms in the marketplace – money down, amortization, etc.
- Know the strengths of your business – NOT just trails / renewals
- Claw backs i.e. selling price reductions – why should you pay for buyer’s mistakes
- Do not approach someone who does not “need” your business – don’t give them the negotiation power
- Do not approach one potential buyer / successor – at least two
- You worked hard to build your business – don’t take the path of least resistance
- Every deal should be win – win – win
All businesses that are considering any major transition should have a plan, a process, a target market and know the end result. Begin with the end in mind.
What is your Plan? Your Process? Target Market?
If you are interested in exploring any of the above further – let’s talk.