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Selling Your Financial Advisory Firm

Navigating the M&A landscape can be exciting yet scary, especially when you’re thinking about eventually selling your financial advisory firm. When the off-ramp approaches, will you be ready to make your exit?

While there’s no map to get you from point A to point B, there are some basic rules of the road that most advisors can follow to achieve a successful journey. The first rule is that planning well in advance of your actual sell date is a must. It will give you the time to be strategic and ensure that the final step is taken at the right time and with the ideal terms. The second rule is that a successful seller journey can generally be broken down into three phases: strategic expansion, optimization, and monetization.

Let’s take a closer look at each stop along the way as you move toward your desired destination.


Strategic Expansion

10–15 Years Before Planned Exit

Creating a significant monetization event in the future means concentrating on strategic expansion now. From pursuing organic growth opportunities to hiring next-gen advisors, there are many avenues to explore well before your planned exit.

You can start by reviewing your firm’s financials and setting benchmarks. It may help to focus on critical growth levers that affect your firm’s profitability, such as revenue trends, profitability margins, expense management, and productivity ratios.

The goal of the check-up is to identify areas where you can create efficiencies, cut costs, and pinpoint where you may have some spending flexibility. For example:

  • Can you digitize your practice if you haven’t done so already?

  • Is your lease agreement consistent with market comps? Based on the local real estate market, could you renegotiate or find a new space?

  • Do you have the right infrastructure in place (i.e., one that operates without overreliance on a firm’s lead advisors)?



5–10 Years Before Planned Exit

As you come closer to selling your financial advisory firm, you enter the next phase of the seller journey: optimization. By amplifying your practice’s strengths at this stage, you’ll see a significant return on your investment when the time comes to sell. A key facet of optimization? Scale and efficiency.

By building scale and efficiency into your client service model, you’ll have more time to prospect and manage clients—without adding expensive resources that eat away at your bottom line. Here are three areas to focus on:

  • Organizing. Start by evaluating your firm’s core processes, including how you onboard new clients and conduct annual meeting reviews. Look for opportunities to be more efficient, offer an improved client experience, and operate with greater consistency.

  • Delegating. Here, you’ll want to determine what you can outsource (e.g., model portfolio management) and consider adding senior-level positions. For example, could you delegate operations and management responsibilities to a chief operations officer?

  • Automating. Technology should be integrated into your firm’s processes and fully adopted by your team. Training relevant staff and advisors on both the process and the integrated technology can elevate the odds for successful adoption.



2–3 Years Before Planned Exit

Planning for your ideal exit takes time. But it’s all to ensure that as the selling advisor you receive a fair value for your practice, can exit at your own time (and on your own terms), and leave a lasting legacy.


Obtaining a formal valuation of your practice before a desired sale date allows you to conceptualize the price and where you feel comfortable selling from a financial perspective. Valuations are meant to be illustrative, but they are a great starting point for negotiation and may be something a buyer requests ahead of time.

Your Journey Starts Today

When selling your financial advisory firm, you may be handing over the keys to a next-gen advisor or liquidating shares as part of an equity structure. But whatever your desired destination, you will need to prepare well in advance of your planned exit so that you can look back with no regrets on the amazing journey you’ve been on.

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