Choosing Help for Your Succession

When it’s time to sell your practice, you want help from someone you know and trust. Naturally it makes sense to turn to your own broker-dealer resources, and although it seems like they would be the best equipped to help you in your transaction, they fall short on getting you the best deal for a couple of reasons.

It’s in their best interest to serve the buyer.

From the broker-dealer’s perspective, the buyer is the one who will be remaining on the platform after the transaction. As a result, the buyer naturally becomes “the client” of the Broker-Dealer during the transaction. At best, the Broker-Dealer operates as an agnostic entity representing both parties. In either case, it leaves the seller without someone in their corner fighting for the best deal possible and looking out for their best interests.

Broker-Dealers tend to undervalue a practice.

The business valuation is one of the most critical elements of the deal, as it establishes the price, and ultimately return on investment to the seller. However, most broker-dealers aren’t experienced enough at properly valuing a practice and many don’t use qualified third-party providers to create a business valuation. As a result, they typically undervalue the business. And again, they are motivated to serve the buyer more so than the seller. The buyer’s goal is always to pay less if possible. This prevents the seller from securing a “premium” deal.

Why it's better to work with an independent succession expert instead.

They are aligned with your goals.

When selling a practice, you want someone who is familiar with your industry and business model. You also want someone who is there to represent your best interests and work for the best deal possible so you can get the highest return on your investment. A succession expert does just that and more. A Succession Expert is motivated to help you meet your goals. First of all, the strength of their reputation depends on how well they serve the seller and deliver a successful outcome. Second, they are compensated based on the sale price. So just like you, they are motivated to secure not only the highest price possible, but also the best terms possible.

It’s a deeper relationship.

The relationship between the seller and the independent Succession Expert is much deeper than that with a broker-dealer. Again, the Succession Expert is motivated to align with your goals in order to help you achieve the best deal possible. To do that, they really need to get to know you and understand how you have built your business, who your clients are, what you want for you team, and what your plans are for the future. Through the process they become personally and professionally invested in your success. This results in a deeper relationship built on trust, understanding, and mutual goals.

They actively support you.

Selling a business is a very emotional experience. Even though it’s a welcome event, as with any change, it will uncover many fears, questions, and concerns you may not be expecting. Your Succession Expert knows exactly how to support you and guide you through these challenges. Throughout the process, they will help you gain and keep perspective so you can get the outcome you truly want.

They have a broader network of resources.

In order to serve their clients, Independent Succession Experts actively build networks of thoroughly vetted, qualified resources to support all elements of the transaction. Each of these resources is evaluated to make sure they know and understand the nuances of the financial services industry and that they have a track record for ethical business practices and successful delivery of services. Often time their network includes a number of lawyers and other legal experts, appraisers, consultants, and lenders. This network amplifies both their reach and the level of support they are able to provide over an in-house broker-dealer succession team.

Bottom line, an Independent Succession Expert has your back. Their success depends on your success. They have the resources and experience to help you get the best deal possible, and to help you transition to your next phase of life.