you started to think about your exit strategy yet? If so, it's absolutely
essential that you give serious consideration to how you are going
to maximize the market value of your business. A mistake can literally
cost you hundreds of thousands of dollars!
the following. Dave and Susan are both ready to exit the wealth
management profession. Dave is selling his book of business. The
value of Dave's book is based on two factors - the value of the
assets that Dave is managing and an estimate of the percentage of
those assets that will go elsewhere when the book changes hands.
Susan on the other hand is selling much more than a book of business.
Over the years, Susan has prepared for this day by structuring and
automating the operation of her practice. She has evolved into a
management role, while her team operates the practice. Now she is
selling a turn-key practice that won't be harmed by a change of
ownership. The person that buys Susan's practice is gaining much
more than a book of business. They are purchasing a proven and self-contained
system. The value of Susan's practice is based on two factors -
the value of the assets being managed by Susan's team and the value
of the system that Susan has put in place. For many wealth managers
(and particularly those that haven't developed a system of their
own yet), the system is actually of greater value than the assets
moral of this story is simple. The value of a turn-key practice
far exceeds the value of a book of business. If you want to retire
in style, now is the time to begin putting your own system in place.