One question you need to ask yourself when first considering your succession planning is what do you want out of it for you and your family. Are you looking for financial security? For more time with your family? Or are you looking to keep working but focus on new challenges?
This will strongly influence what kind of exit would work best for you – particularly when considering whether the exit is staggered over a period of time or one single event.
Advisers naturally want to make sure that they not only pick the right path to access liquidity for themselves, but also for their team and their clients.
There are a lot of options out there when it comes to planning the future for your business.
Training up your team
Should your firm have staff, the simplest succession plan would perhaps be for your successor to come from your existing team.
However, this not only requires an existing team member to want to take over the business, but also requires them to have the capital to do so.
You need to consider the position of your staff: are some of them wanting to remain working in the long term, or are they nearing retirement?
Selling your firm to your team may also be a succession plan that takes a lot of planning.
Buying a business is a long-term commitment and requires considerable capital, so is not generally an option for those in a hurry.
If you think selling to a member of your team could be right for you, then make sure to engage with your employees and find out how they see their career progressing.
If there is anyone that shows a desire to move up the ranks and take over the firm, then you can work with them to achieve it.
The challenge of succession planning is making sure all those with a stake in a firm or interests in it are catered to.
For those whose biggest concern is protecting their staff, selling your firm to a member of your team would seem the best option to protect their interests and future.
Having a clear succession plan also helps with the building of a talent pool and offers staff a sense of security around their future, no matter the type of business sale you would consider.
With a clear succession plan in place you will have determined the long-term pathway for both yourself and the business, and can then consider what skills talent and age group you need to maintain and sustain that value path for staff, clients and investors.
Once you have hired your team you need to analyse their personal ambitions, skills and attributes and identify their development needs.
