Financial advisors have a lot of experience coaching clients through the largest financial decisions of their lives, particularly planning for retirement. However, when it comes to preparing for your own retirement, the planning process does not always seem so simple. Whether it’s as part of a succession plan or with the goal of growing your firm, the decision to merge or sell is the biggest move you will make in your lifetime, and the preparation involved should be as extensive as that for a client.
Before diving in headfirst, here are four best practices that will ensure your firm’s sale goes smoothly and results in a positive outcome for all parties.
Look at the big picture
Before engaging in the sales process, take the time to look at the big picture and ask yourself some important questions, not just as they pertain to you, but to your clients and employees. When it comes to your clients, there are a number of ways their advisor experience could change for the better, including gaining access to more service offerings and advanced technology. For your employees, show them the decision to sell is not the end of the book, but a new chapter. Highlight the benefits of joining a new firm, especially a growing one with upward mobility and increased opportunities. And for you, remember that it means less administrative work and more time to focus on what you love.
Find a cultural match
Your company culture is the heart of your business and defines your relationship with clients. The best way to start the acquisition process is by knowing what you want and finding the right complement to your approach. Follow the same due diligence process you employ for clients when vetting potential acquirers. Listen to what the acquirer is seeking to gain from the acquisition and share what you can bring to the table in terms of your strengths and passions. If the “why” behind their business and culture doesn’t match the value you are looking to mirror in your own firm, it’s probably not a good fit. Additionally, be sure you’ve found a partner you and your clients can trust. Just as your clients trust you with their financial future, you should be able to trust your new partner with yours.
Be upfront about sensitive subjects
Big financial decisions tend to put people on edge. When it comes to giving up control of your business, that edge can get sharper. Stickier subjects, such as loss of control, the details of a succession plan and transaction terms, should be put on the table at the beginning of the process to ensure complete transparency and give time to find a compromise if needed. Understand you will need to adopt their policies and practices, but recognize what that means for your future. This is why a trusted partner is especially vital; you must be able to have candid conversations that meet all parties’ objectives.
Consider what you can bring to the table, but be flexible
While you may be joining a new firm and aligning with their practices and philosophy, remember that at the end of the day the acquisition should also be a partnership. Share what roles and responsibilities you’d like to take on and offer feedback on how you can help make the transition seamless. As a partner, it’s important to be flexible and open to change. Too much rigidity can hurt your business and the success of the acquisition.
This new chapter can lead to the exciting next phase of your career and enhance your ability to serve your employees and clients. Good luck; an exciting future awaits.