It seems that virtually every advisor is on the prowl these days to buy a book of business from a retiring advisor. When my phone rings, odds are pretty high that someone is calling to ask, “How can I buy a mature practice?”
It’s a lopsided marketplace, however, with potential buyers vastly outnumbering sellers.
Since there are no precise numbers easily available, it’s hard to know if there are 30, 50 or even 100 potential buyers for each solid advisory practice that comes onto the market. Regardless of the exact figure, the reality is clear: Competition is stiff, and success is far from assured.
How can advisors beat the odds and make an acquisition happen?
One popular strategy is to shop for a book of business online via websites that match buyers and sellers of advisory practices. (Everything from video games to CDs routinely gets sold online–not to mention Star Trek actor William Shatner’s kidney stone and Britney Spear’s half-eaten sandwich.)
Budding entrepreneurs raise money to launch new businesses on line. So why not buy a financial advisory practice online?
While an online format seems like an easy, convenient solution, it’s certainly not a method that a prospective buyer can count on to deliver the goods. (Sellers, of course, are in the driver’s seat, so the likelihood of their finding a suitable match online is quite high.)
If you’re serious about getting married, you might put up a profile on match.com. But it’s not the only thing you would do. It’s just one piece in the complex process.