You invest a substantial amount of energy into running, growing, and evolving your business. Knowing when, where, and how to best direct your efforts could mean the difference in thousands, or even millions, of dollars long-term. Having spent two decades accruing and organizing essential datapoints on more than 15,000 businesses, we’ve got a tight grasp on what matters most at each step of the way.
Depending upon your goals, certain areas will move the needle faster than others. Rather than guess at the best use of your limited resources, our team has compiled a list of places where your ownership and C-Suite team can start assessing opportunities for increased firm value.
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Topics:
Selling Your Practice,
Business Growth,
M&A,
Revenue Strength,
Business Value,
Revenue Sharing,
Multiples,
Benchmarking,
Valuation & Appraisal,
KPI
We’re coming off an incredible year from mergers and acquisitions yet again. In fact, we closed out 2022 as one of our greatest ever for FP Transitions, and the same goes for Live Oak Bank. We took a moment to reconnect with James Hughes, SVP of Advisory Lending for Live Oak Bank, to break down the key areas advisors should consider before they enter the 2023 mergers and acquisitions environment.
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Topics:
Acquisition,
M&A,
Business Value,
Deal Structure,
Financing,
Bank Financing,
Buying & Selling,
State of the Market,
Next Generation,
Valuation & Appraisal,
"Buying, Selling, and Valuing Financial Practices",
Sell and Stay™,
Trends
I rarely meet a financial advisor who doesn’t immediately mention that they want to buy a practice. It seems to be every advisor’s goal. Of course it is. And in my fifteen years in the industry, I have seen why.
One of the fastest ways for a firm to grow is to acquire another book of business. However, the process is more nuanced and competitive than most advisors seem to think. Most assume they will figure it out as they go along. If you take the unguided DIY approach, however, mistakes will be made–perhaps big ones–and you’re likely to leave money on the table. Our EMSTM Grow members know this more than anyone, which is why they've engaged our experts to help them prepare and achieve their acquisition goals.
Like every aspect of business ownership, acquiring a book of business takes advanced consideration and preparation. These are a few steps you should be taking now, prior to developing and executing your acquisition strategy.
1. Develop Your Buyer Profile
Membership to fptransitions.com is free. We don’t believe there should be a series of hoops to jump through before you can explore the largest open market of M&A opportunities; or even to access our library of business building, acquisition, and succession resources.
Step one to taking advantage of your fptransitions.com membership is to complete your buyer profile. This series of basic questions gives the team at FP Transitions an overview of your company and team so we can best help you find acquisition opportunities that would be a good fit.
Pro tip: FP Transitions uses the information provided in your profile to search our database of 25,000+ advisors to find the right buyers for private sales, continuity partner matching, and successor searches.
The buyer profile is your opportunity to offer information that makes you stand out from your peers. The Practice Description field especially. If you offer a few concise thoughts on what makes your practice unique, you’re already setting yourself apart.
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Topics:
Acquisition,
Business Growth,
Business Value,
Continuity Partner Matching
For many years, our data has shown that firms with over $2M in annual revenue tend to grow twice as fast as those with $250K in annual revenue. Contrary to how it might seem, this is actually a function of their structure, not necessarily their size. These firms have cultivated efficiencies in cash flow, capacity, expenses, and operational systems to support scalability and growth. These sophisticated structures are accessible to most businesses–in a wide range of revenue levels–if they’re willing to explore and dedicate time and resources to improve.
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Topics:
Business Growth,
Business Value,
Client Retention,
Benchmarking
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Despite the continued surge of wealth management M&A activity, one surprising fact remains: most of these market participants are engaging in a transaction for the very first time. While there are aggregators and larger RIAs that will continue to build up their business through strategic acquisitions, the majority of today’s deals spark from a mutual attraction either from aligned competencies, or complementary competencies, that allow both firms to amplify their growth and sustainability.
According to James Fisher, Vice President of Mergers and Acquisitions at FP Transitions, “Many practices are looking to be acquired or merge with a larger business to spur growth, to benefit from economies of scale, to offload compliance and day-to-day operations, to increase bandwidth and offerings to clients, or to assist with the retirement of one or more senior owners/partners, among other reasons.”
Regardless of experience, it takes a lot of patience, communication, time, and expertise to navigate the entire deal process. For firms going through this, on any side of the table, negotiating and documenting the transaction can often be more time consuming than anyone anticipated, creating the perfect environment for an all-to-common problem: deal fatigue.
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Topics:
Selling Your Practice,
Acquisition,
M&A,
Business Value,
Deal Structure,
Buying & Selling,
Mergers
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We just got back from Fort Lauderdale where we spoke at the WealthStack RIAEdge conference for WealthManagement.com. James Fisher, FP Transitions’ Vice President of M&A spoke with several advisors onsite. We wanted to take some of the questions that we received and see if we could answer them for our broader client base.
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Topics:
Selling Your Practice,
Commentary,
M&A,
Business Value,
Buying & Selling
"Think about those future goals."
"Hold steady and don't react to the market."
"Remember, we have a plan and it's still well on track."
Throughout the market roller coaster of the Pandemic and now with 2022 rearing its head, advisors are getting used to coaching clients through market volatility. What matters most in these scenarios are two things: first, a trusted relationship between advisor and client, and second, preparation and education to navigate these emerging challenges.
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Topics:
Succession Planning,
Selling Your Practice,
Business Value,
Sustainability,
Trends
Business growth is a never-ending, and ever-changing objective of all business owners; financial planners included. While the lingering social effects of the pandemic and the challenges of upscaling during the Great Resignation/ Reshuffle can make the task-at-hand seem insurmountable, there are still tangible ways that you can steer the course of your enterprise. Here are a few tips to help grow your financial planning business.
1. Invest in Human Capital
Most advisors have built their business from nothing into their single most valuable asset. Finding talent can be a challenge these days, especially with unemployment settling into lows not seen in over 50 years. Data from FP Transition's Valuation Database has indicated that businesses with multiple professionals accumulate assets at a higher rate than sole practitioners. As your business matures, it is imperative to invest in the next generation of talent, to keep the engine running while you begin to enjoy the reward for what you’ve built.
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Topics:
Acquisition,
Multi-Generational Ownership,
Business Growth,
Tip of the Week,
Revenue Strength,
Enterprise Strength,
Business Value,
Buying & Selling,
Next Generation,
Talent Recruitment,
Building Your Team,
Client Trust,
Business Operations,
Trends
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Topics:
Continuity Planning,
Webcasts,
Multi-Generational Ownership,
Organizational Structure,
Business Growth,
Tip of the Week,
Business Value,
Client Success,
Sustainability,
Client Relationships,
Business Operations
2021 is just about behind us, and 2022 is knocking at the door. What are the 2022 trends in the financial planning advisory space that we consult? We had an opportunity to ask our experts what they see in their respective crystal balls...
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Topics:
Selling Your Practice,
Acquisition,
Multi-Generational Ownership,
M&A,
Business Value,
Deal Structure,
Financing,
Bank Financing,
Buying & Selling,
State of the Market,
Mergers,
Tax Regulations,
Building Your Team,
Valuation & Appraisal,
Transactions,
Trends
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