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May 10, 2022

Ep. 15 How to be Prepared for the Industry’s Succession Crisis Ft. Rick Wedell, CIO at RFG Advisory

 

 

Rick Wedell is Chief Investment Officer at RFG, and he’s back on War Room Huddle with Shannon Spotswood, President of RFG. Together they tackle one of the biggest challenges in the industry—how to be prepared for a succession crisis. They also identify widely held misconceptions about valuation, deal structures, and everything else in between for advisors that have a $50 – $300 million AUM practice.

Rick is Chief Investment Officer of RFG and oversees RFG’s in-house investment strategies at Bluemonte. Prior to joining us on our mission to build RFG 2.0, Rick spent 12 years at Bain Capital Partners where he crafted financing packages, negotiated deal terms, and helped design buyouts. Rick played an instrumental role in helping Bain grow to become a global investment powerhouse, serving client assets in excess of $30 billion.

Selling a practice is tough, but Rick comes to this conversation with a unique perspective not found anywhere else. In this revealing episode, he exposes the real truth about advisor succession and answers the raw, unfiltered questions. He also gives straightforward advice on one of the toughest parts of a sale: deal structure.

Join the conversation to hear about:

  • Focusing on segmenting the market, financial packages & designing deal terms (3:21)
  • What is my succession plan? (11:03)
  • Protege vs. acquisitions (19:42)
  • Defining your practice (25:08)
  • Aligning your values & how you treat your clients goes a long way (30:08)
  • Getting “cute” with deal structure (36:19)
  • Do I have to accept a seller’s note? (41:51)
  • Developing a synopsis for your practice (53:52)
  • Behavioral modification (55:20)
  • Organizing a successful handoff of the client relationships (1:06:59)

Listen to this episode of War Room Huddle, featuring Rick Wedell, CIO of RFG Advisory. Below are three important takeaways from his discussion around advisor succession you’ll want to check out. Huddle up for this inspiring episode of War Room Huddle. Join RFG.

  1. Ensure that you have a standard deal structure. The bottom line is that deal structuring is the bread and butter of M&A; advantages can be gained or lost depending on how a proposed deal is structured and how the negotiations go down.
  2. Start having a conversation with an acquiring advisor as early as possible. Whether it’s measuring revenue, analyzing a transition period and what those benchmarks will look like, identifying the big picture with your advisor is what you ultimately need to do.
  3. Develop your protege. As you’re entering the process of needing a succession plan, it’s important to understand that most acquirers are acquiring a revenue stream and are planning to integrate it into their practice.

This podcast is brought to you by RFG Advisory. The War Room Huddle Podcast is available on Spotify, Apple Podcasts, and wherever you listen to podcasts. Hear host Shannon Spotswood, RFG President, and our financial advisor guests talk about crushing everything and their unique stories. We’re here to help independent financial advisors amp up their A-game and stay on top of what’s going on in the industry.

Download this episode now and listen on your commute or at the gym.

Referenced Materials

Tags

  • Succession Planning
  • Acquisition
  • Financial Packages
  • Deal Terms

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Securities offered by Registered Representatives of Private Client Services (“PCS”). Member FINRA/SIPC. Advisory services offered by Investment Advisory Representatives of RFG Advisory, a registered investment advisor. Private Client Services and RFG Advisory are unaffiliated entities.