A couple of years ago, the principals of two high-profile financial advisory firms, one from Virginia, one from Chicagoland, were looking across a desk at one another pondering a merger of their firms when they came to a moment that almost crashed the whole thing.

Glenn Kautt, a Navy veteran in his mid-60s who had once been involved with nuclear reactors on warships and later spent a couple of decades cobbling together four or five advisory firms, had brought his McLean, Va., firm The Monitor Group to the table with Savant Capital, a Rockford, Ill., firm that had risen improbably in the soil of a declining Rust Belt city, raising a $2 billion firm entirely organically.

The crux of the matter was that both Kautt and Savant founder Thomas Muldowney were in their 60s, a time when people are starting to think of getting out of the business. Kautt was certainly thinking that way, wanting to leave by the time he was in his early 70s. That meant too many chips were about to come off the table.

“Tom looked around and went, well if Kautt’s out, I’m out,” Kautt recalls. “At that point, that represented more than 50% of the shares, which means we just killed the company, because you can’t extract 50% of a person’s blood, it just doesn’t work. So before the deal was done, it collapsed.”

The chance to add Monitor’s $500 million in assets to Savant’s $2 billion and change hung in the balance, but by the end of the deal, the principals had come up with a way to wed their companies, in essence by building a private business wrapped around a public company structure. It required them, says Kautt, to check their egos, give up the “benevolent dictator” model, think of the legacy they were leaving, and perhaps build a behemoth rather than a puzzle of self-interested shareholders.

Those are lofty words, but hard to make pennies out of. Kautt himself says, not joking, that the best way for a financial advisor to really extract the most value out of his firm is to drop dead at his desk. He was looking at that possibility himself as far back as 13 years ago when his older partner, the late legendary Lynn Hopewell, told him how long he’d looked for a successor. Kautt thought of grooming someone himself. But he consulted with Pershing-Moss Adams guru Mark Tibergien, who said the “white knight saving the firm” idea was nice, but didn’t work 95% of the time.

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