What’s the difference between a smart succession and a rushed exit? Tyson Ray and Kim Cochenour are joined by Nick Arellano to discuss why treating your firm like a house sale is risky, and how valuation, growth, and planning shape your future.

This conversation will help you approach succession and exit planning – something 40% of advisors will face over the next 5-7 years – with clarity, confidence, and long-term vision.

• Tyson Ray, Kim Cochenour and guest Nick Arellano look at the elements of a smart succession and what makes for a successful business exit.
• Nick shares his background, while Kim shares an advisors-plumbers similarity.
• Not having a succession plan, and the increasing age of advisors are something advisors should really be paying attention to as the landscape is shifting.
• This may come as a surprise to you but an estimated 40% of advisors are set to retire over the next 5-7 years.
• Many advisors treat succession just like selling a house – Nick explains why that happens and the potential risks of having that approach.
• Tyson shares the story of how getting a valuation impacted him, and what advisors in a similar position should consider.
• Nick goes over the key factors of valuation: growth, value, and profit.
• Kim stresses a misconception many advisors believe, as they think that’s valuation is only based on their revenue…
• Understanding that your business is not just producing income, but is an actual asset that has value is a mindset shift many advisors are unable to wrap their head around.
• Nick explains that whatever you take on an annual basis is going to impact the value you’re going to get.
• The less you take upfront, the larger the value is going to be. The more you take in compensation, the lower the value is going to be.
• Want to do a successful succession? “You kind of need to start checking your ego, and now you just start letting go of some things to enhance the value of your company,” says Tyson.
• Nick goes over why, in his opinion, the financial advising industry hasn’t incorporated young talent really well.
• Many advisors have an operational agreement, but don’t actually know what’s in it.
• Remember: everything in valuation comes down to growth, risk, and profit.
• Nick discusses what their goals working with advisors is, and how you can start the process of getting help from Your Legacy Partners.
• Don’t forget: it’s not really about the exit…it’s about what comes next.

Mentioned in This Episode:

TotalSuccession.com

TotalSuccession.com/podcast

FORM Wealth Advisors

Tyson Ray

Kim Cochenour

Nick Arellano

YourLegacyPartners.com

nick@yourlegacypartners.com

The ALS Foundation