TRANSITION TALK

After Laurie Nichols out of her business four years ago - a transition that took her on a personal goal-setting journey (read about it in her first guest post here)- she was able to look back on the importance of planning ahead for a successful exit and future for herself and her business.

Over the years, as my partners and I grew our business, opportunities to monetize seemed to crop up regularly. We figured we had time though and relaxed into our comfortable position on the fence certain of a “someday score”–we thought there’d always be someone eager to buy and we’d be set.

We had no dates, no planning tasks, no target successor profile. We coasted on autopilot and didn’t really think much about someday–except the occasional fantasy about the cash out sure to come.

Wake up

Then, about 10 years ago, the wake up calls started and we realized someday was upon us with no “score” in sight. As I look back on my transformation from shareholder to seller, three particular wake up calls stand out as crossroads that could have easily been ignored.

The 4-year anniversary of the sale of my financial advisory business is rapidly approaching. 

The memories from 30 years spent in the financial services world, including 20 as a managing partner, haven’t completely faded yet. But the time away has allowed for a fresher perspective on the journey that brought me to where I am today.

It feels pretty amazing reporting from the other side of selling a business in the investment world. There are a blend of emotions—gratitude, energy, purpose and, most importantly, happiness.

I didn’t always feel this way.

Ownership Decisions

Being one of three shareholders in a “boutique” firm was like riding a roller coaster—at times completely exhilarating, and at others, totally terrifying.

We had the usual business challenges—market volatility, staffing issues, compliance rules, fee pressures. Fortunately, the successes we achieved far outweighed these challenges.

As the years ticked by, our commitment to making decisions that would ultimately benefit us when it came time for succession paid off. All the usual processes that are part of a sale were relatively (and fortunately) uneventful—due diligence review, operational preparation, deal structure, and transition. 

The Internal Struggle

What took me most by surprise was the internal tug of war; the mental and emotional in-fighting I started to experience. My self-doubts and fears kicked into overdrive. Why was this so hard? This is what we had all agreed we wanted, right? What if the clients are upset? What if I don’t like it?

After being in the financial services industry for over a decade, there is one thing I have found to be an almost universal truth: Independent financial advisors absolutely love what they do. The topic of selling is often sensitive and difficult for advisors who have been growing an independent practice for the majority of their careers.

Many advisors who have built their practices from the ground up are not always ready to sell and walk away. There are some, however, who are ready to slow down after years of a rewarding career and view selling as a path to retirement. Whatever the situation may be, there are several things that you should consider if you want to receive the full value of your practice while also finding the best fit for your clients.