In 2018, I successfully sold, and exited my Financial Planning Practice.
After nearly 20 years owning and running my own business, it was a big change, but one that I felt was right for me and the firm. The practice was in a good place, with engaged clients, a great team and strong financials. It was well positioned to navigate the various challenges and reforms that were facing the profession and was poised to go to the next stage of its development and growth.
As an accountant and financial adviser with more than 30 years’ experience, I was confident that both the Business and I were well prepared for what lay ahead.
What I wasn’t prepared for was how much the process would teach me about the Value of a Good Adviser.
One of the best decisions I made, was to engage a professional adviser early on to help me with the process. I had known this person professionally for more than a decade and had a high degree of trust in their experience, skills and integrity. Their brief was threefold: (i) to do due diligence on the Business to make sure it was “sale ready”, (ii) to take the Business to market and identify a short list and ultimately a preferred buyer (iii) to assist with contract negotiations and finally, settlement.
When it came to stage 1 – due diligence, it turned out we were in very good shape. Being very focused and fastidious around numbers and processes, I was able to furnish my adviser promptly with all the details he needed about the Business. What’s more, these numbers confirmed we were an attractive proposition for potential buyers.
Similarly, I was able to help my adviser with stage 2 – going to market. I was well connected and had a good reputation within the industry. This meant that together, we were able to promote the opportunity to a wide net of potential buyers, generate significant interest, and progress quickly to a short list of suitable candidates.
It was when we got to stage 3 that my adviser really came into his own. As we entered serious negotiations and eventually started drafting contracts, things started to get bogged down. What seemed to be a clear and simple Heads of Agreement between buyer and seller started getting more complicated as our respective legal teams got involved. Somehow, the deal seemed to be getting further and further away, even whilst both parties were happy with the terms and keen to move ahead. As negotiations wore on, frustrations grew and goodwill started to wane.
Throughout this process, my adviser provided a cool head and wise counsel. He calmly listened to my rantings as frustrations boiled over, talking me “down from the ledge” many times and refocusing me on the big picture. He reassured me that these sorts of delays were commonplace, that he had been through it many times before and that all would turn out well in the end. He dispensed sound advice when decisions needed to be made. He dealt with the various parties involved, bringing influence and pressure to bear when necessary to secure an outcome for his client.
And he was there to celebrate with me when the sale went through!
It brought home to me how deeply clients rely on their Trusted Adviser during major life events.
I had built my Business and career around the value of good advice. But going through a “retirement” experience myself gave me a visceral sense of the vulnerability and value associated with relying on a Trusted Adviser at such a critical, life changing juncture.
It is easy for Advisers who do what they do every day, to underestimate and undervalue the profound impact that they can have. In particular:
1. We take for granted the comfort that clients feel in knowing that what they are going through for the first (and usually last time), we have been through countless times. They have one shot at getting “this” (whatever “this” is for them) right. Having an Adviser that they trust to help them do this is invaluable.
2. We underestimate how vulnerable clients feel when they are getting advice. Placing your trust in another person is one of the scariest things in life. Advisers who respect and repay that faith with great advice lift a huge burden from clients’ shoulders
3. We can make the mistake of thinking that our advice is somehow less valuable to more financially informed clients. Yet if anything, the opposite is the case. I can tell you first hand that the anxiety of navigating a major financial issue is no less real to someone with over 30 years of financial experience than it would be to a novice. In fact, I suspect the more you know, the more anxiety you feel about what can go wrong.
As I pen this article, global sharemarkets are reeling with falls of around 20% in 2 weeks due to fears about Coronavirus. It is times like this, when uncertainty is at its greatest, that the experience and wisdom of a Trusted Adviser is most valuable. Having lived (and advised) through the 1987 stockmarket crash, 1994 Great Bond Massacre, 1997 Asian Financial Crisis, 2000 Dot Com Bust and the Global Financial Crisis from 2007 to 2009, like any experienced adviser, I know that this too shall pass.
Yet the value of an Adviser is not in being smart enough to know that this crisis will end, but in being wise enough to help clients manage how it makes them feel.
To paraphrase Rudyard Kipling: “If you can keep your head when all about you are losing theirs and blaming it on you. If you can trust yourself when all men doubt you……..then you will be a Trusted Adviser”, and your clients will thank you for it, more than you know.
Paul Little has over 30 years’ experience as an accountant and financial adviser and is a Business coach of Slipstream Coaching, a company dedicated to assisting financial practitioners achieve their full potential. Paul can be contacted by phone 07 3221 3796 or via email firstname.lastname@example.org