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Adviser Workshop: How to create a succession plan

Adviser Workshop: How to create a succession plan

Lee Waters

Chief executive, Barwells Wealth

Barwells is part of a partnership with a law firm that has been operating for 120 years. There has always been a rolling movement of ownership and control with the law side of the business, which the IFA arm could learn from.

Pass the torch

We identified the need for a succession plan about eight years ago. My dad is still part of the business after passing the reins to me, but he wanted me to have a long enough period to become fully integrated into managing the firm.

The ownership was ageing, and the law firm and IFA recognised the need to start planning for the long term. With a smaller IFA, you have to find someone you trust to hand the reins to.

Plan for the future

Younger advisers are usually more savvy with technology, and the transition to the use of platforms and back-office systems that streamline processes, rather than the old method of putting everything into a spreadsheet. This allows you to do more with each client.

There have been firms we have looked at buying that have had filing cabinets full of paper files and mountains of data in spreadsheets. This is not attractive. Future-proofing the firm with an eye to succession planning needs to start early.

Younger people want to engage with younger clients and can relate to the ways those younger clients want to work with an adviser. Being able to use client portals, Skype and other technical tools is much more important nowadays.

Andrew Elson

Managing director, Beaufort Financial Planning (Yorkshire)

I am only 46 but I must be looking old as every new client in the past six months has asked what is happening to the business in the future.

We want to make it a self-managing business and we are doing that by finding specific roles. This includes having a senior paraplanner who can give advice to the same standard as myself, and buy into our vision and way of doing things.

Share the wealth

We would like our staff to start owning the business: we do not plan to sell, get a fat cheque and walk away, as that is not the commitment we have made to our clients. They have made a lifetime commitment to us and want to remain with us, so we could not sell to a firm with a different ethos. It also helps to build cohesion for staff to share in the firm’s success.

Our plan is to find the right structure to allow our staff to build a small stake in the business, which will grow over time. 15 years from now, director Sarah and I will have reduced our own stakes to around half of the business, from a 60:40 split, and we will take a more strategic role.

Share knowledge

We are running a service for our newer clients, and some of the bigger ones, where two advisers sit in on client meetings, so the client has more than one person who understands their circumstances. This ensures consistent treatment of clients and helps staff grow.

We have taken on an apprentice and are looking at establishing a graduate scheme.

Chris Budd

Managing director, Ovation Finance

The focus of nearly everything you read about business owners seems to be regarding the question of ‘what is my business worth?’

I do not care what my business is worth, because I do not plan to sell it. If I sold it, I would sit on the sofa with my money and no sense of purpose. 

Open the pathway

My priority is to make my role in the business enjoyable, empower my staff and make my company eternal. That means creating a pathway for my staff, especially those in advice roles, to end up owning the business and to benefit from the profit it makes.

We need to take the focus away from what the business is worth to ensuring it is a happy place to work and it is yielding financial profit.

In a lot of adviser practices, older advisers are waiting to sell up, which is not creating a fruitful environment for young advisers to develop. These advisers have to set up on their own and start all over again rather than taking an established business forward. This is not good for the client, who benefits from consistency through the years, or the profession.

Invest in the future

It is better for old and young advisers if a succession plan is created. If a firm is sold for lots of money, that money is usually invested for income. But why not keep that investment in the business, transfer the responsibilities and make investments that way?


  • Lee Waters: Find someone you trust to take the reins.
  • Andrew Elson: Make the same long-term commitment to your clients as they make to you.
  • Chris Budd: Stop worrying about what your business is worth and focus on making it sustainable.

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