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How Advisor Teams Breed Success (and How to Build Them)

Submitted by John Brown on Fri, 03/30/2018 - 6:00am
Image of an Advisor Team

In this series of articles, we’ve been reviewing the five foundational elements of the Exit Planning process that BEI Members use. Working together, these elements are responsible for the success Members have experienced in helping their business-owning clients achieve the business exits they desire. Exit Plans created by BEI Advisors are:

Today, we’ll look at why it’s so crucial for Exit Planning Advisors to assemble an Advisor Team as they begin the Exit Planning Process.

Why an Entire Team?

Successfully creating and executing an Exit Plan typically requires expertise from several advisors from different professional fields. That’s because no single advisor has sufficient expertise or experience to create and implement all of the activities required in a typical Exit Plan.

Most of an owner’s Advisor Team members are specialists within their respective professions. For example, one owner’s plan may require the services of the following:

  • Estate planning attorney
  • Employment law attorney
  • Tax attorney
  • Benefits attorney
  • Business attorney with significant experience with designing key-employee incentive plans subject to IRC Section 409A.

And that’s just legal counsel. When added to the other professions and specialties required, Exit Planning Advisors might have an Advisor Team bench of 15 or more different professionals. Fortunately, this number is normal for successful Exit Planning Advisors, because in order to create a comprehensive Exit Plan, each element of the Exit Plan requires comprehensive knowledge from experts in each applicable field.

What If Exiting Business Owners Already Have Advisors?

Successful business owners almost always have advisors that they’ve used in relation to their businesses, at least periodically. How do successful Exit Planning Advisors assemble an Advisor Team for business owners who already have advisors?

Successful Exit Planning Advisors don’t seek to replace business owners’ current advisors unless the owner is dissatisfied with them. Instead, they seek to include current advisors in designing and executing the Exit Plan. However, few business owners will have relationships with all of the professionals needed to create and execute an Exit Plan. Thus, Exit Planning Advisors often need to integrate advisors that they’ve worked with and trust to fill in the gaps.

Interviewing Advisor Team Candidates

As Exit Planning Advisors begin to assemble their Advisor Teams, there are three things they must do to provide business owners with the best team possible.

First, they must recruit the best of the best advisors to their clients’ Advisor Teams. When doing so, Exit Planning Advisors typically explain to Advisor Team prospects that the team itself is an informal concept. Rarely do all team members meet as a group. Instead, the Exit Planning Advisor coordinates all advisor activities.

Second, Exit Planning Advisors explain to prospective Team Members that they should expect to serve as sounding boards for planning ideas and sources of suggestions for business owners. This interchange typically occurs via phone and/or email, and happens shortly after engaging the client.

Third, it is important for Exit Planning Advisors to tell prospective Team Members that they don’t charge clients for the initial time they time they spend determining possible Exit Planning approaches and recommendations. That’s because this initial time is seldom more than an hour and frequently opens the door to an engagement. In a sense, the willingness of prospective Advisor Team members to provide free advice and observations initially is the price they pay for being included (and hired) to help plan an owner’s exit, which can pay dividends down the line.

Qualities of Advisor Team Members

We’ve discussed the why and the how behind building Advisor Team, but what about the what? What makes a good Advisor Team member?

Good Advisor Team members have five general qualities:

  1. Best of the Best: Best-of-the-best advisors focus on addressing specific Exit Planning issues related to their expertise. When searching for best-of-the-best advisors, Exit Planning Advisors must avoid the temptation to include advisors simply because they can bring them referrals.
  2. Collaborative: The best Advisor Team candidates work well with other advisors.
  3. Timely: Exit Planning relies heavily on meeting established deadlines. Advisor Team candidates must be able to respond to the Exit Planning Advisor’s queries promptly and meet all established deadlines.
  4. Willing to Learn: Prospective advisors should be willing to learn about the Exit Planning Process, both in general and their roles in it. This willingness helps them integrate into the team more fluidly and facilitates teamwork.
  5. Willing to Spend Time: Before and after they join the Advisor Team, advisors should understand that brainstorming with the Exit Planning Advisor is a necessity to best represent the business owner.

The Benefits of Having a Great Advisor Team

Exit Planning Advisors who assemble great Advisor Teams provide themselves and their business-owning clients two overarching benefits.

  • Advisors on the Advisor Team are responsible for recommending plan designs and subsequent implementations relevant to their expertise. When Team Members do a great job, Exit Planning Advisors and business owners do well, and business owners are positioned to achieve their exit goals.
  • Great Advisor Team members make the recommendations that create best-of-the-best Exit Plans for business owners. Happy business-owning clients talk about their great experiences, leading to more work for Exit Planning Advisors through referrals.

In next week’s article, we’ll tie everything together by discussing the organized process BEI Members use to create owner-centric, written plans that are products of a collaborative effort of a Team of Advisors led by one advisor skilled in Exit Planning.


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