Building the Right Team to Support Your Business Priorities

Posted by FP Transitions on Dec 4, 2023 9:00:00 AM

Blog Banner - Building the Right Team to Support Your Business Priorities

One of the most difficult challenges for independent advisory businesses is finding and retaining the professionals they need to service a growing client base and perpetuate sustainability. The talent pool is extremely competitive, especially in the financial services industry. The value of a strong team and integrated business is ever increasing, and the number of new advisors coming into the profession is still relatively low. To be successful in building the right team, you’ll need to be strategic in your efforts and focus on the people that best align with your business priorities and your plans for growth.

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Topics: Compensation, Organizational Structure, Business Growth, Next Generation, Talent Recruitment, Sustainability, Wealth Management, Business Operations

Purpose, Perspective, Premise — the Three Ps of Business Valuation

Posted by FP Transitions on Nov 1, 2023 9:00:00 AM

Banner Blog - Purpose, Perspective, Premise — the Three Ps of Business Valuation.

Purpose, perspective, and premise are the foundations of business value. With these three key aspects we can weigh an incredible amount of detail and data to determine the most accurate value of the business–for any circumstance. The more accurate the value, the better the outcome of your situation, and the better your ability to plan ahead for future growth and higher profits.

Everything starts with “why.” What is the purpose for the valuation? As we like to say, “value is in the eye of the beholder,” and purpose allows us to pinpoint that perspective to know what makes a business valuable to them. And when we drill down into situational specifics and the nuances of perspective, we can understand the future-state of the business and the premise of the valuation to fine tune its accuracy.

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Topics: Succession Planning, Business Growth, Business Value, Benchmarking, Valuation & Appraisal

What Sellers Want - Multi-Generational Buyers - M&A Playbook

Posted by FP Transitions on Oct 25, 2023 3:33:00 PM

One of the other things that I see a lot more sellers asking for is multi-generational ownership and multi-gender ownership. I encourage my clients to diversify their ownership group as much as possible.

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Topics: Succession Planning, Acquisition, Multi-Generational Ownership, Buying & Selling, Open Marketplace, M&A Playbook

Fit Above Everything Else - M&A Playbook

Posted by FP Transitions on Oct 4, 2023 12:21:00 PM

The biggest mistake that I see people make–the single biggest mistake–when they are in pursuit of an offering that we have on the open market, is they position themselves as a great practice, they don't position themselves as a great fit. Really not understanding what fit is and just thinking I can afford this practice and I'm 50 miles from it. And while those things can be important, there are other things that are critical in what fit is and what goes into us finding the perfect fit.

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Topics: Acquisition, Buying & Selling, Open Marketplace, M&A Playbook

Business Insights Solving for Growth & Capacity Constraints

Posted by FP Transitions on Oct 3, 2023 9:00:00 AM

Blog Header - Business Insights Solving for Growth  & Capacity Constraints

Sparking that next phase of growth might be harder than expected. For firms moving from sole proprietor to a practice, growth may come easy – but only to a certain point. When a plateau hits, where should advisors look to dig in and overcome? Benchmarking, alongside a deep understanding of business growth and value drivers, is where firms can stand apart from the pack.

If you are ready to grow your financial advisory business and wondering, “Why haven’t I grown faster?” this may be the blog post for you.

Read on for our best tips on diagnosing and overcoming growth inhibitors.  

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Topics: Business Growth, Building Your Team, Client Relationships, Business Operations, Key Insights

What Sellers Should Ask About Instead of Multiples - M&A Playbook

Posted by FP Transitions on Sep 27, 2023 1:04:00 PM

Ultimately, I think sellers come to us and they want to know what kind of multiple they can get to their business. And the question is really well-intentioned, what I think would be better for sellers to ask is: How do I position my business to get the most value or to achieve my strategic objective?

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Topics: Acquisition, Buying & Selling, Open Marketplace, M&A Playbook

Our Dealmaking Framework

Posted by FP Transitions on Sep 27, 2023 8:00:00 AM
FP Transitions has a unique process that is something that we have honed and developed over 25 years in the industry. We take a non-advocacy role. Let me explain what that is. Non advocacy is a different type of approach to M&A. Most of the M&A industry uses advocates on either side, a seller advocate, a buyer advocate, and these advocates, together with the principals, go hard at it in creating a deal.

Here's what's different in the wealth management industry, the value of what is being traded are client relationships. Sometimes that gets lost in the entire equation. What we're trying to do is take care of those clients and make sure that they have been transferred in the best way possible. So why does an M&A deal get in the way of that?

What most are trying to do instead is to maximize dollars or be the one that has the best advantage on a contract. What gets lost in that is the partnership that is needed between buyer and seller when this transaction is done. Unlike traditional M&A, buyer and seller need to leave the table, if not as friends, at least as good working partners. This is a place where you can totally win the battle and lose the war if they don't depart that way. And that's where we have a problem. 

Oftentimes it's the advocates themselves fighting for the best interest of their particular client. But those interests oftentimes get muddied with contract negotiations. Then who wins? We take a different approach.

Our approach is to act in the fairness of the transaction, helping both buyer and seller. Does that mean that we don't advocate for the seller? Not at all. We absolutely advocate for our seller clients and we help our buyer client as well. We help them reach the perfect deal by starting out with the best match possible. If we have the fit right, the rest of the transaction goes together.

We do something unique in that we mediate our deals and put them together with lawyer dealmakers. That's helpful because our lawyer dealmakers are able to talk to the other advocates in the transaction: seller, lawyer, buyer lawyer to help them understand what the overall objective is and to get to a better solution. 

Not only does this result in better deals, but important to both buyer and seller.

We close 80% of the transactions we embark on. So in the end, this is less expensive, less grueling, and people leave having understood that, the most important thing is the transfer of the client relationship. 


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Topics: Acquisition, M&A

The Invaluable Role of Mediator in M&A

Posted by FP Transitions on Sep 12, 2023 8:00:00 AM

Blog Refresh - Is Mediation For Your Deal a Good Investment

Whether you’re buying or selling a business, there are a few players that are “must-haves” on your transaction team: personal lawyer, CPA/Tax professional, representative of your IBD/Custodian, personal stakeholders, and a non-advocate, industry-experienced mediator. 

The role of each of these players is important to the overall success of your deal, however, the mediator can sometimes be overlooked–often to the disadvantage of your deal. So, why are they so important?

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Topics: Selling Your Practice, Acquisition, Buying & Selling, Trends in Transactions Study, Transactions

Strength in the Marketplace - M&A Playbook

Posted by FP Transitions on Sep 7, 2023 12:39:00 PM

How has marketplace strength held on throughout 2023?

We've seen a really strong M&A marketplace in 2023. Demand is still really strong. As we've consistently had at least over the last five years, we've got an inverse in terms of there's a really strong demand and not a whole lot of supply. And that trend has continued in through 2023.

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Topics: Acquisition, Buying & Selling, Open Marketplace, M&A Playbook

Top 10 Drivers of Business Value

Posted by FP Transitions on Sep 6, 2023 8:00:00 AM

Blog Header - Top 10 Drivers of Business Value (1)

The value of your practice is determined by many factors, some obvious, and some not so obvious. And the degree to which some aspects impact your value more largely depends on the reason you’re valuing the business in the first place. 

Whether you’re considering acquisition, onboarding new talent–or new owners–, monitoring annual growth, or getting ready to sell, these ten factors have the most significant impact on the value of your business. Focus in these areas can make a major difference in your book’s sustainability and its eventual purchase price when transition time arrives.

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Topics: Business Growth, Business Value, Buying & Selling, Sustainability, Benchmarking, Valuation & Appraisal