TRANSITION TALK

Deal Fatigue - Top Factors for Fatigue and how to Minimize Them

Posted by FP Transitions on Sep 16, 2021 1:01:24 PM

estimating Value blog banner

Wealth management firms seeking rapid growth are increasingly turning to mergers and acquisitions (“M&A”) as a solution.  As such, we are seeing a lot of M&A activity involving firms with multiple owners, staff, and even real property. 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. Given these complicating factors, negotiating and documenting these M&A transactions can often be more time consuming than the parties expect, which creates the perfect incubator for deal fatigue.   

Deal fatigue is a condition during negotiations when one or more of the parties begins to feel frustrated, hopeless, irritated, or even angry about the pace of the transaction.  Deal fatigue–at some level–is almost impossible to avoid in a complex transaction, but if caught early and prepared for it can almost always be successfully managed. If not, deal fatigue is one of the surest ways to destroy a transaction. The key is to know the causes and signs of deal fatigue as well as the tools to minimize its negative impact.     

Causes of Deal Fatigue 

There are of course many causes of deal fatigue, but some of the most common ones that we routinely see are: 

  • Time 

Deal fatigue is typically correlated with the time it takes to complete an M&A transaction. Typical transactions take about three months. Parties can get frustrated if they feel like they’re being rushed, while others may feel frustrated if the process starts to feel too drawn out. Striking a balance between the two is important.

Read More

Topics: Selling Your Practice, Acquisition, M&A, Business Value, Deal Structure, Buying & Selling, Mergers

Leveraging the FPT Open-Market Advantage

Posted by FP Transitions on Aug 31, 2021 1:34:12 PM

When it's time to sell your financial advisory practice, knowing the value of your business is just as important as finding the right buyer. But as you begin exploring your options, determining who will be the right buyer to take over your business often takes center stage. The FP Transitions® Open Market will not only locate a new owner who is a good fit for your clients and investment style, but also help you obtain the most value from the sale.

 

Benefits of the FP Transitions Open Market

Tapping into an open marketplace has benefits for both buyers and sellers. Buyers have access to a larger pool of acquisition opportunities with the potential to meet their strategic goals. This includes those outside of their already established network and area, allowing them to expand their reach. And sellers gain access to a large number of qualified buyers in order to find the best possible buyer for their business.

Read More

Topics: Selling Your Practice, Acquisition, Business Value, Buying & Selling

Debunking Five M&A Myths

Posted by FP Transitions on Aug 20, 2021 3:47:30 PM

M&A Myths-blog-banner

During our 2021 Mid-year Market Update, in addition to up-to-date transaction data and trends, our experts, M&A Director James Fisher, JD and CEO Brad Bueermann, explored some myths and misconceptions about the current M&A marketplace.

The problem with misinformation is that as a buyer you may find yourself discouraged from exploring acquisitions or mergers as a growth strategy or from inquiring on businesses that could be a great fit and expand your reach. As a seller, misinformation can lead you to compromising your fit criteria or from exploring a wider pool of buyers.

The following are the top five misconceptions we hear from advisors and from other market participants.

MYTH: Reported transaction data shows a complete view of the industry M&A marketplace.

No current reporting of annual M&A transactions–including ours–encompasses activity across the entire industry. Even if data is being reported based on publicly advertised transactions, many are private and not publicized as larger M&A deals tend to be. Details and terms are often kept confidential regardless, and, as the old adage goes, "the devil is in the details." So, comparing the data and transaction activity across firms participating in M&A can be tricky.

Read More

Topics: Selling Your Practice, Acquisition, Buying & Selling, State of the Market

Mid-Year Market Review [VIDEO]

Posted by FP Transitions on Aug 11, 2020 4:09:23 PM

Earlier this year, with the global pandemic raging and markets in decline, we promised our clients and the industry that we would continue to provide an inside look as to what was happening in the M&A market for financial advisory practices.

Read More

Topics: Commentary, M&A, Buying & Selling, Transactions

Considering Key Staff During the Sale of Your Business

Posted by FP Transitions on Jul 30, 2020 1:25:00 PM

key-employees_blogbanner

It’s hard to keep secrets in a small office. The rooms are tight, the walls are thin, and it’s just a matter of time before everyone knows everyone else’s business. Even when an owner has quietly decided to sell their practice, they should assume that staff members will eventually find out (if they haven’t already). In our experience, it’s best that employees hear the news from someone they trust: the owner.

Prospective sellers are often reluctant to speak to staff members about their exit plans because they aren’t sure how the selling process will pan out and they don’t know how the staff will feel about the change. While it’s important to be sure of your decision before announcing your plan, looping your staff into the process can increase your success and can even help shape the structure of your sale.

Read More

Topics: Selling Your Practice, Deal Structure, Buying & Selling, Building Your Team, "Buying, Selling, and Valuing Financial Practices"

Buyer Benefits of a Sell and Stay® Transaction

Posted by FP Transitions on Jul 22, 2020 10:59:00 AM

SSbuyerbenefits_blogbanner

The Sell and Stay® approach to selling a financial services business was developed by the professionals at FP Transitions to fulfill the preference of many sellers to gradually exit the business by giving up their ownership obligations while continuing to service clients and earn an income. This arrangement can be customized in a hundred different ways, but often entails an owner selling the majority–or all–of their ownership to a third-party buyer and remaining as an employee of the business for a set number of years (typically 3-5) before fully exiting.

Buyers who are open to this type of transaction not only access a larger acquisition pool, but can enjoy other unique advantages as well. You, of course, enjoy all the benefits of a traditional acquisition: immediate growth, available financing options, expansion into different areas and niches, and economies of scale. In addition, the acquisition can help you tackle some other areas of your long-term growth strategy through:

    • Client Continuity and Retention
    • Turn-key Practice / Office
    • Talent Acquisition
    • Reduced Training Costs
    • New Competencies and Service Offerings
    • Institutional Knowledge
Read More

Topics: Acquisition, Deal Structure, Buying & Selling, Sell and Stay™

Marketplace Activity : Recently Sold Practices

Posted by FP Transitions on May 4, 2020 10:46:00 AM

Even with market volatility over the past few months, the marketplace for financial advisory businesses has remained strong. FP Transitions is pleased to announce the recent sales of financial services businesses in the following areas :

  • Palm Beach, FL  |  $6,000,000
  • Houston,TX  |  undisclosed
  • North Carolina  |  undisclosed
  • Rhode Island  |  $1,500,000
  • San Francisco Area, CA  |  undisclosed
  • South Carolina  |  $3,600,000
  • Sacramento Area California  |  undisclosed
  • Atlanta Area, GA  |  undisclosed
  • Miami Area, FL  |  $350,000
  • Lafayette Parish, LA  |  undisclosed
  • Rhode Island  |  $700,000
  • Houston, TX  |  $1,100,000
  • Chicago Area, IL  |  $120,000
  • Northwestern, TX  |  $450,000
  • Boston Area, MA  |  undisclosed
  • Florida Panhandle  |  undisclosed
  • Tampa Area, FL  |  $750,000
  • North Carolina  |  $450,000
  • Michigan  |  $1,200,000

VIEW CURRENT LISTINGS HERE 

LIST YOUR PRACTICE WITH FP TRANSITIONS

State of the Market: Outlook for Advisory Firm Valuations [Webinar Replay]

Sold announcements include all closed third-party transactions facilitated by FP Transitions, including private listings, pre-arranged matches, and those listed on the open market. 

Read More

Topics: Selling Your Practice, Acquisition, Buying & Selling, SOLD

Offers in the Mail

Posted by David Grau Sr., JD on Apr 30, 2020 1:13:11 PM

lettersinthemaili_blogbanner

For many financial advisors, it has become commonplace to receive unsolicited offers in the mail. The offers to buy practices usually promise a competitive valuation and purchase price, great terms and future opportunities, and are backed by private equity, bank financing, or other cash reserves. More than anything, these letters bring hope, choices, and affirmation that an advisor has built something valuable and transferable.

Some of these letters arrive from well-known firms but many are from smaller, previously unknown suitors whose marketing strategy is to grow rapidly through practice acquisition. The advisors we talk to on a daily basis tell us about these letters dismissively at first, but they also say they keep the letters for future reference–just in case. Hope and choices are good things, even if they’re not needed today.

It is always flattering to be recognized, wanted, and valued, even if your name comes from a purchased mailing list. The more important point may be that these letters get many independent advisors, like you, thinking and wondering about the future. Questions arise: What is my value? What options do I have? Is this the best offer, or maybe the only offer, I’ll ever get? Can I sell my practice and keep working, given that I’m not ready to fully retire right now?

Read More

Topics: Selling Your Practice, Acquisition, Due Diligence, Buying & Selling, Press Release, Transactions

A Look Back at Advisory Success in 2019

Posted by FP Transitions on Jan 2, 2020 4:43:00 PM

As we jump into 2020–a new decade!–we are proud to look back and see so much success in growth and transitions for our clients. In 2019, FP Transitions facilitated a variety of business growth goals for our community of advisors through strategies that Included internal succession, enterprise structuring, sustainable business growth, mergers, and external sales.

We'll soon be releasing our M&A data and observations from 2019, so stay tuned!

Over the last year helped facilitate external and internal transitions all over the country, including in : 

Central Maine
Northern Kentucky
Sacramento, CA
Columbus, OH
Dallas, TX
New Haven, CT
Baltimore, MD
Houston, TX
Northern Michigan
Atlanta, GA
Gulf Coast Florida
Southern Florida
Northern California
Boise, ID
Upstate New York
Southern Illinois
Fresno Area, CA
Central Coast New Jersey

Washington D.C. Area
Orange County California
Richmond, VA
New York, NY
Palm Beach, FL
San Francisco, CA
Santa Cruz, CA
Central North Carolina
Orlando Area, FL
Eastern Tennessee
Northern New Jersey
Georgia
Western Louisiana
Kansas City, MO
Eastern Pennsylvania
Marin County California
Seattle, WA
Iowa

New York, NY
Central Coast California
Boston, MA
Baton Rouge, LA
Central California
Newark Area, NJ
Minneapolis, MN
Southern Texas
Central Michigan
Chicago, IL
Southern California
Eastern New York State
Western Oregon
Central Colorado
Philadelphia, PA
Portsmouth, RI
Delaware
Northeastern Wisconsin

We're also pleased to announce that we closed out the year with sales of financial services businesses in the following areas!

Read More

Topics: Selling Your Practice, Acquisition, Buying & Selling, SOLD

SOLD : Oct/Nov 2019

Posted by FP Transitions on Dec 9, 2019 2:16:30 PM

FP Transitions is pleased to announce the recent sales of financial services businesses in the following areas :

  • Northern Kentucky  |  $600,000
  • Northern Michigan |  $795,000
  • Sacramento Area, CA  |  undisclosed
  • Washington D.C. Area  |  $1,200,000
  • Eastern Pennsylvania  |  undisclosed
  • Dallas, TX  |  undisclosed
  • Sacramento Area California  |  $1,100,000
  • Washington D.C. Area  |  $565,000
  • Richmond, VA  |  $920,000
  • Santa Cruz, CA  |  $345,000
  • Dallas Area, TX  |  $3,700,000
  • Northeastern Pennsylvania  |  $535,000
  • Palm Beach, FL  |  $880,000

VIEW CURRENT LISTINGS HERE 

VIEW COMPLETE LIST OF PRACTICES SOLD 

LIST YOUR PRACTICE WITH FP TRANSITIONS

Sold announcements include all closed third-party transactions facilitated by FP Transitions, including private listings, pre-arranged matches, and those listed on the open market. 

Read More

Topics: Selling Your Practice, Acquisition, Buying & Selling, SOLD

Blog Comments