independent financial services and advisory industry
perpetuation strategy for
Income approach to valuation
Incubator:
about
goals
Lifestyle Succession Plan
minority discounts
stock grants
in succession plans
“Independent Financial Service Growth Rate Study,”
Independent financial services and advisory industry:
age of advisors
career length
growth rates
history, lack of
income statistics
rules of
talent crisis, solving
wirehouses versus
Individual books organizational structure
Insurance:
disability, lump-sum
life
practices based on
Insurance trails
Internal buyout:
about
asset sales
continuity agreement
deal structure
events prompting
partial book sales
stock sales
succession plan versus
Internal Revenue Code (IRC). See also Taxation
gifts
reorganizations, tax-free
Section 102(a)
Section 102(c)
Section 368
stock grants
Internal Revenue Service (IRS). See also Taxation
employee stock ownership plans
reorganizations, tax-free
stock grants
Interviews and tests for key staff members
Investment Advisers Act of 1940
Investment advisor representatives (IARs)
Investment in equity
Investment Management Consultant Association (IMCA)
Involuntary departure of partner/shareholder
IRC (Internal Revenue Code). See also Taxation
gifts
reorganizations, tax-free
Section 102(a)
Section 102(c)
Section 368
stock grants
IRS (Internal Revenue Service). See also Taxation
employee stock ownership plans
reorganizations, tax-free
stock grants
Job:
defined
as industry percentage
mentality, persistence of
Kadlec, Dan
Lawyer, on support team
Liability considerations in entity structure
Life insurance
Life Insurance Marketing and Research Association (LIMRA)
Life raft model
Lifestyle Succession Plan. See also Succession planning
described
failure of
goals of
multiple-tranche strategy
results of
rewards for planning ahead/starting early
schematic
success of
Limited liability company (LLC). See also Operating agreements
advantages of
described
documentation for
formalities, internal
internal sales
onboarding talent with a book of business
ownership of
profit distributions
S corporation versus
setting up
shareholders
taxation of
LIMRA (Life Insurance Marketing and Research Association)
LLC. See Limited liability company (LLC)
Lump sum payout, bank financing for
Management, client
Market approach to valuation
Marketplace demand factors, in valuation
Marriage, economic
Match, quality of
Math, doing the
Mergers:
acquisitions versus
defined
employee stock ownership plans versus
rarity of
taxation of
as term
“Millionaires and the Millennium: New Estimates of the Forthcoming Wealth Transfer and the Prospects for a Golden Age of Philanthropy” (Schervish and Havens)
Minority discounts
Minority ownership interest
Multiple-tranche strategy:
in Lifestyle Succession Plan
in succession plans
succession team and
National Association of Personal Financial Advisors (NAPFA)
National Center for Employee Ownership (NCEO)
Net new client growth
Noncompete/nonsolicitation agreements
Obligations created by stock grants
Obstacles to succession planning:
books and records, sharing
change, resistance to
control, losing
defensive strategy
industry rules
next-generation personnel not ready
next-generation successors lack money
own money, paying yourself with
sales culture
tools/strategies, inappropriate
Onboarding talent with a book of business:
about
contribution agreement
evaluation period
LLCs
S corporation
taxes
valuation, formal
“One class of stock” rule
Operating agreements:
defined
funding
goal of
purposes of
Opportunity versus entitlement
Oppression, shareholder
Oregon Administrative Rules
Oregon Revised Statutes (ORS)
Oregon Securities Division
Organizational structures. See alsospecific structures
about
changes in
equity-centric
individual books
ORS (Oregon Revised Statutes)
Owners:
founding (see G-1 (Generation One))
planned (see G-2 (Generation Two))
potential (see G-3 (Generation Three))
succession planning, advantages of
thinking like
Ownership:
of entity structure
minority interest
widening, reasons for
Ownership grants:
about
company withholding/deductibility
disadvantages of
fair market value/basis
obligations created by
rules for
strategic use of
taxation of
as tenure issue solution
vesting issues
Ownership track:
continuity plan tips
family business
Palaveev, Philip
Partial book sales
Partners, continuity
Pay cuts, avoiding:
case study
cash flow remodeling
obstacles to succession planning
Payment terms
PEP (Practice Emergency Program)
Perpetuation, business
Pershing, LLC
Phantom stock plan (PSP):
accounting for
case study
as cash bonus plan
as stock-based compensation plan
Planned owners. See G-2 (Generation Two)
Planning. See also Continuity planning; Succession planning
exit
family business
for funding continuity plan
replacement
rewards for
Plans, change in:
G-1 (Generation One)
G-2 (Generation Two)
G-3 (Generation Three)
Plans, rolling five-year
Potential owners. See G-3 (Generation Three)
Practice. See also Selling practice
business versus
buyer demand for
defined
described
expenses
gross recurring revenue multiple
as industry percentage
insurance-based
life raft model
size of
tenure of
type of
value, effective
value, rule of thumb for
Practice Emergency Program (PEP)
Present value of discounted future cash flows
Price, fair
Production model:
business model versus
described
Profit distributions:
in cash flow modeling
entity structure and
limited liability companies
S corporations
Profits:
distribution of
function of
goal for
importance of
value and
Pro forma spreadsheets
Promissory note, performance-based
PSP (phantom stock plan):
accounting for
case study
as cash bonus plan
as stock-based compensation plan
Reasons for succession planning:
clients, advantages to
owners, advantages to
Records, sharing
Registered Investment Advisers (RIAs):
about
as succession team members
Rejuvenation effect
Reorganizations, tax-free
Replacement planning
Retirement, gradual
Revenue:
collection of
growth of
recurring versus nonrecurring
strength of
transactional
Revenue-sharing agreements (continuity plan):
about
advantages of
applicability
disadvantages of
forms
Revenue-sharing arrangements:
about
advantages of
case study
disadvantages to G-3
disadvantages to owner
RIAs (Registered Investment Advisers):
about
as succession team members
Risk, diversifying
Risk factors, transition:
about
client tenure
level of
noncompete/nonsolicitation agreements
practice tenure
technology use
Rolling five-year plans
Sales culture
Schervish, Paul G.
S corporations. See also Case study
about
described
employee stock ownership plans
formalities, internal
LLCs versus
minority discounts
onboarding talent with a book of business
“one class of stock” rule
ownership of
profit distributions
stock grants
taxation
SEC (Securities and Exchange Commission)
Section 102(a), of Internal Revenue Code
Section 102(c), of Internal Revenue Code
Section 368, of Internal Revenue Code
Securities and Exchange Commission (SEC)
Securities Exchange Act of 1934
Seller, average age of
Seller criteria:
geography
price and terms
quality of match
Seller financing:
benefits of
in deal structure
drawbacks to
valuation and
Selling practice:
about
asset sales
contingent financing
continuity agreement
deal structure
employee stock ownership plans versus
events prompting
externally
internally
partial book sales
seller, average age of
seller criteria
seller financing
stock sales
succession plans versus
succession team, dissatisfaction with
Shareholders:
dilution of
entity structure and
involuntary departure of
oppression of
Shareholders' agreements:
defined
funding
goal of
purposes of
Sharing books and records
Ship model for business
Silos. See also Practice
defined
described
SMP (Succession Maintenance Program)
Sole proprietorship:
about
asset sales
tax issues
Spreadsheets:
for continuity plan
pro forma
Stand-by arrangements
Steps in succession planning
Stock-based compensation plan, phantom stock plan as
Stock bonus
Stock grants:
about
company withholding/deductibility
disadvantages of
fair market value/basis
obligations created by
rules for
strategic use of
taxation of
as tenure issue solution
vesting issues
Stocks, average annual return on
Stock sales:
internal buyout
third party, selling practice to
Strategy:
defensive
rethinking
Strength, revenue
“Strong man” approach
Success, foundation for
Succession Maintenance Program (SMP)
Succession planning. See also Lifestyle Succession Plan; Succession plans; specific topics
case study
clients, advantages to
continuity planning as dress rehearsal for
continuity planning versus
enjoying process of
importance of
obstacles to
owners, advantages to
reasons for
steps in
timing of
Succession plans. See also Succession planning; specific topics
continuity plans versus
defined
exit strategies versus
financial analysis of
math, doing the
selling practice versus
uniqueness of
Succession specialist, on support team
Succession team. See also Talent
dissatisfaction with
employees, turning into equity partners
formula, secret
help wanted ad for
hiring, training, and retaining G-3 level
multiple-tranche strategy
onboarding talent with a book of business
success, foundation for
super producers
talent pool, mining
Super producers
Support team:
assembling
CPA/accountant
lawyer
succession specialist
Supreme Court (U.S.)
Survey results, cautions about
Takeovers
Talent. See also Succession team
crisis of, solving
importance of
onboarding
recruiting
Taxation. See also Internal Revenue Code (IRC); Internal Revenue Service (IRS)
of acquisitions
of employee stock ownership plans
entity structure and
flow-through entities
of mergers
onboarding talent with a book of business and
reorganizations, tax-free
of stock grants
Team, support. See also Succession team
Technology use
Tenure:
client
practice
stock grants and
Tests and interviews for key staff members
Texas Tech University
Third party, selling practice to:
about
asset sales
contingent financing
deal structure
geography
price and terms
quality of match
seller, average age of
seller criteria
seller financing
stock sales
Time frame for succession planning
Time magazine
Timing:
of continuity planning
of succession planning
Trailing 12 months. See also Gross recurring revenue multiple
balancing revenue strength and enterprise strength