Show Me The Money – Acquisition Financing Trends
If you asked us five years ago about financing the acquisition of an advisory practice in the financial services industry, there would not have been much to talk about. Until recently, almost all deals were done using a combination of buyer’s funds and seller financing. Bank financing was not a viable option for most deals because lenders generally struggled with the collateral on the loan – an advisor’s most valuable asset in their business is the client relationship and cash flow those relationships produce. Before the market drop in September 2008, some advisor buyers were able to leverage home-equity lines of credit or large business lines of credit, but most had to use personal funds to finance their deal, which priced many otherwise qualified successors out of the market. Until recently, the typical deal for advisors with less than $5,000,000 in annual revenue involved 20-40% cash down from a buyer, with the balance seller-financed over 4 to 5 years at 5-7% interest. That is changing, and the results seem to be good for everyone involved in the deals.
5 Mistakes to Avoid During an Acquisition
https://youtu.be/4PiT9LDMQDc 5 Mistakes to Avoid During an Acquisition You’ve got a deal with another advisor, but now what? Erik Pahlow, Former Executive Vice President of SRG, will cover the steps from identifying your successor or seller, to closing the deal, and everything in between. He will also share the five biggest mistakes made in purchase agreements by advisors. Join us so you are prepared to make the right decisions during the selling process to ensure you do it right the first time!
2017 Advisor M&A Trends
Join us as we delve into the 2017 Advisor M&A Trends and discuss another exciting year for the financial services industry with increased RIA and advisor consolidation, changes in compliance and the Department of Labor Fiduciary Rule, and the tax reform — all of which had a direct/indirect impact on the value of RIA and advisory practices. This infographic shares the 2017 highlights in addition to what we shared in SRG’s live webcast.
Advisor M&A Financing: How to Make It Work for You
https://youtu.be/MlhbJuIKBvU The deal volume for selling advisor practices continues to increase, yet demand has remained strong. Advisors interested in purchasing a practice must understand how deals are getting done today. With down payments rising and more than 60% of deals last year using external lending, understanding how bank lending can work for you is almost a requirement to get your deal done. Join us to learn:• How lending is changing the industry• What the typical terms for loans are• Different ways to use lending• How to cash flow model the deal with lending involved Whether you are a buyer or a seller, this webinar will be a refresher or an exploration of your financing options.
Practice Acquisition Checklist for Success
Download Your Checklist! Please enable JavaScript in your browser to complete this form.Please enable JavaScript in your browser to complete this form. Name * FirstLast Phone Work Email *How Did You Hear About SRG? *— Select Choice —ConferenceDirect MailExisting/Past ClientGoogle AdWordsOtherReferralSocial MediaSeminar/WorkshopWebinarWebsite Download Sellers on average have between 40 and 50 interested candidates, but less than 10% of these potential buyers are qualified and ready. With so much interest and competition for practices, if you are serious about adding acquisition or mergers to your growth strategy, it is important to ensure you are prepared, organized, and committed. Given industry demographics and projections for the financial services industry, advisors looking for an exit are out there, and the number will only continue to increase every year. The following checklists are designed to help ensure you have a robust set of marketing channels being leveraged, that you are deploying your strategy consistently, and that you have the infrastructure in place to close the deals as you build your pipeline. Created by RIA M&A experts and divided into three parts, these checklists cover the three initial stages of your acquisition strategy, starting with preparing internally, deciding on your seller marketing goals and strategy, and finally tangible recommended sourcing strategies.
The Must-Know Items When Buying or Selling a Practice
https://youtu.be/s4VLqDzg9xY Following up on the most recent article, 6 ‘Must-Know’ Items When Selling Your Practice, published by ThinkAdvisor featuring commentary from David Grau Jr., David will share and elaborate on the must-know items for buyers and sellers, and why they are critical to know. The fast-paced 15-minute session will cover: Why selling doesn’t mean retiring Why all-cash deals are becoming the new normal Why practices remain undervalued and what to expect Taxes – how to get the most out of the deal (for buyer AND seller) Profitability and its impact on the value
Due Diligence Checklist
Download Your Checklist! Please enable JavaScript in your browser to complete this form.Please enable JavaScript in your browser to complete this form. Name * FirstLast Phone Work Email *How Did You Hear About SRG? *— Select Choice —ConferenceDirect MailExisting/Past ClientGoogle AdWordsOtherReferralSocial MediaSeminar/WorkshopWebinarWebsite Download Stay on track. Whether you decide to buy or sell a financial advisory practice, it can be complicated and there will be many moving pieces to keep track of and negotiate. Succession Resource Group’s Due Diligence Checklist provides a comprehensive list of some of the most commonly asked for items to review before buying/selling a financial services practice. As you negotiate a deal, due diligence periods typically range between one week up to four weeks, so it is important to make sure you have a reliable list of items to review before consummating a purchase. Using this checklist as a guide with your attorney/accountant, you can be sure you review at least the basic components of the practice and know who you are considering doing a deal with before final negotiations and signing a purchase/sale/merger agreement.
3 Takeaways from 2016 Financial Services M&A Data
2016 was an exciting/interesting year for the financial services industry, with many changes in compliance and the Department of Labor Fiduciary Rule, broker-dealers being bought/sold or shut down, all of which had a direct or indirect impact on the value of advisor’s practices. In January, Succession Resource Group presented our most interesting findings from deals done in 2016, with record attendance. This infographic highlights three of the most interesting takeaways from SRG’s live webcast. Please feel free to share it with your friends in the financial industry.