TRANSITION TALK

Applying Our Own Advice to Ourselves, Not Just Our Clients

Posted by FP Communications on Jun 3, 2022 5:00:00 AM

Blog - Applying Our Own Advice

"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

Succession Planning Course Corrections

Posted by FP Transitions on Mar 29, 2022 12:30:00 PM

Course-Correction

Succession planning is a critical, foundational element in building a sustainable business. Incorporating new talent into your ownership structure is a process that takes continuous planning, evolution, and monitoring. When done correctly, succession planning ensures incredible employee culture, firm growth, and enduring business value. When the brunt of the planning is complete and documented with the help of partners like FP Transitions, firms have to stay focused as they begin executing their plan. Owners and next generation leaders must engage in transparent communication to navigate the inevitable bumps that can occur throughout the planning and execution of a succession strategy. The reality is, we’re all human. Life presents curves, and personal and professional goals can change. These anticipated bumps can necessitate larger course corrections in order to keep your plan on track.

Typically there are three areas where succession plans may need course corrections: if founder/owner plans change, if successor plans change, and if Plan B needs to be activated.

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Topics: Succession Planning, Selling Your Practice, Sustainability

Enhancing Your Successor Traits as a Woman in Wealth

Posted by FP Communications on Mar 8, 2022 3:38:39 PM

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Enhancing Your Successor Traits as a Woman in Wealth 

Written by Jess Flynn, Communications Director at FP Transitions

Recent Bureau of Labor Statistics data details that women comprise 47% of the workforce, but just 29% of senior management positions. While more women are entering the financial planning profession, they are joining in marketing, administrative, or other staff roles within financial planning firms and related organizations. There is still a large gender inequity between females in leadership at these firms, and it becomes especially apparent as we look at the number of female owners in the financial advisory space.  

As advisory firms continue to build profitable, transferrable and enduring businesses, one critical gap in this process has been around attracting and retaining diverse talent. While many firms have openly committed to embracing diversity, equity and inclusion within their firm, the effects of this are yet to be seen in the broader financial services community.

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Topics: Succession Planning, Culture, Next Generation, Sustainability, Women in Wealth

LLC vs. Corporation. Which entity structure fits your goals?

Posted by FP Transitions on Feb 23, 2022 1:32:32 PM

 

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LLC vs. Corporation. Which entity structure fits your goals?

Understanding your specific needs and specific goals is an important first step of the entity-building process. As Rod Boutin, JD, General Counsel at FP Transitions outlined in a recent webinar, “it is important that we build an entity that clearly identifies and promotes your attainment of those goals. Done right, an entity is a tool to align with your goals.”

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Topics: Succession Planning, Organizational Structure, Business Growth, Tip of the Week, State of the Market, Exit Planning, Next Generation, Sustainability, Wealth Management, Valuation & Appraisal, Business Operations

The Sell and Stay® Strategy

Posted by FP Transitions on Jan 3, 2022 10:39:00 AM

The Sell and Stay™ Strategy

Everyone has a unique vision of their future; we’re all trying to forge a path with our careers to that end goal where we can take a big breath and simply enjoy the life we’ve earned. While we might have an idea of the specific journey we will take, it’s important to remain open to alternate routes and unexpected shortcuts along the way. The hardest step on this journey for most is that which takes them out of the professional world they’ve been a part of for many years.

Unique goals and unique journeys require a creative strategy. For financial advisors, the Sell and Stay® path offers flexibility and freedom for an exit from the industry. There are advisors in the industry who have built a team of advisors with next generation owners and have built an internal transition into the sustainability of their business. The majority of our industry, however, is still made up of single-owner practices. Luckily, Sell and Stay® offers them the option of a similar exit path.

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Topics: Succession Planning, Selling Your Practice, Exit Planning, Sell and Stay™

Aligning Ownership Priorities for Success

Posted by Kem Taylor on Jan 28, 2021 2:17:34 PM

Succession Blog Aligning Ownership Priorities

In our more than twenty years’ experience helping businesses design and implement internal succession plans, we’ve seen that each generation—G1, G2, and G3—can, naturally, have their own distinct points of view and priorities. These differences are common and normal. By acknowledging these differences and communicating with each other, teams can adjust their expectations, align their priorities, and see their transition plans work out to the satisfaction of everybody.

But how do you align different priorities within your own ownership team? Below are three examples of how to facilitate this alignment. These examples are not of particular clients, but are taken from a conglomeration of advisor situations over the years.

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Topics: Succession Planning, Acquisition, Business Growth, Next Generation

Managing Roadblocks Along the Next-Gen Ownership Path

Posted by FP Transitions on Dec 8, 2020 7:24:01 AM

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When it comes to planning for the future, flexibility is important. Change is bound to happen–whether we see it coming or not. Planning for future growth and ownership of a business is no different. As a next-generation professional in this industry, being able to adjust your course while keeping your eye on the ball is imperative.

In the past, we’ve written about how founders and existing ownership teams can prepare for and adapt to changes that might come their way. While next-generation professionals may encounter similar roadblocks, you will face unique challenges of your own. In the current phase of your career–building experience, relationships, and leadership potential–the course correction discussion is less about planning for the future of a business as an owner, and more about carefully plotting the future of your career.

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Topics: Succession Planning, Multi-Generational Ownership, Next Generation

The Case Against Revenue Splits [Article]

Posted by FP Transitions on Oct 28, 2020 6:16:00 AM

With all of the modern tools for practice valuations and equity management solutions available, some financial advisors still choose to use revenue splits, or a revenue-sharing arrangement, as a makeshift succession plan. For a practice owner, this can be a poor and shortsighted business decision for several reasons, including:

  • Unfavorable tax implications.
  • Potential asset and client disputes.
  • Reduced business value.
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Topics: Compensation, Succession Planning, Enterprise Strength, Cash Flow, Sustainability

Identifying Key Successor Traits

Posted by FP Transitions on Oct 21, 2020 6:19:34 PM

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As an owner of a successful financial advisory business, you understand that the team you’ve built is vital to that success. Taking the next step and giving your top talent the opportunity to become owners can increase your growth and ensure that the business will continue to be successful–for generations to come.

Assembling this successor team and committing to a long-term partnership are important and weighty decisions. How will you know who will make a good partner? What traits and behaviors suggest that someone will make a successful owner? Much of that depends on your own values and priorities as the majority owner of your firm.

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Topics: Succession Planning, Next Generation, Sustainability, Building Your Team

Benefits of Synthetic Equity for Next-Generation Owners

Posted by Stuart Smith, JD on Sep 30, 2020 4:56:11 PM

Benefits of Synthetic Equity for Next-Generation Advisors

The term “synthetic equity” refers to a set of compensation tools that is commonly used to provide key employees some of the economic benefits of ownership without actual stock changing hands. While existing owners may benefit from synthetic equity by capitalizing on employee performance without relinquishing ownership, there are key benefits to next-generation advisors, too.

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Topics: Compensation, Succession Planning, Next Generation, Sustainability, Building Your Team