Built-in Fracture Lines
A large percentage of advisory practices have built in “fracture lines” by using a revenue-sharing arrangement to compensate multiple professionals in one office. Unfortunately, this habit neither protects the value of the practice nor creates a sustainable and enduring enterprise. Fracture lines are built into the practice model as individual books or practices are built in an environment that starts out collaboratively but most often ends up creating competitors.
In the independent sector your focus should be on creating a team of advisors that work together—compensated for contributing to an supporting a single enterprise—rather than individuals building their own books and leaving the practice with the clients and cash flow they’ve generated.
Download “Destabilizing Value with Revenue Sharing” to learn more about:
- How revenue-share arrangements weaken business value and durability;
- How to prevent fracture lines through proper compensation;
- How to create value beyond cash flow, through equity;
- And, how to harness equity value to build a strong team and sustainable business.
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