Accept that clients are realistic about your need for succession.
Advisors need to realize that clients understand that the business will eventually transition to new ownership, the report states. The focus should be on maintaining the practice’s independence.
“It’s much easier to have a conversation with clients regarding a sale to another wealth manager than it is regarding a sale to a bank or a roll-up [firm],” the report states.
Prepare for a long, emotionally grueling transaction process.
The typical sale usually creates an “emotional roller coaster ride” that lasts from nine to 15 months, according to the report. That includes about two to three months to narrow down the field of candidate buyers. Once that is completed, a potential buyer is usually given exclusive rights to negotiate an agreement for 90 to 120 days.
What follows, according to the report, is best described as a “grind.”
“A typical wealth manager M&A transaction involves three to four inches of documents,” the report states. “Each will have to be reviewed by counsel and will undergo significant revisions at least a dozen times.”