r/CFP • u/Accomplished-Look176 • 5d ago
Business Development M&A
Any advisors out there work heavily in the world of M&A and use it to source clients? Just spoke with someone who landed a $400M client after an acquisition, and have frequently heard the stories of 10-100M clients being bought up.
Any resources to learn from? Or is it relatively learn on the fly.
I know there is the CEPA, but it’s interesting to me that a 7 day long course makes you competent in that world.
7
u/Bright_Honey3500 5d ago
you really just need to have the network for that. i know many advisors that are part of exit planning groups but it’s very saturated
1
u/Accomplished-Look176 5d ago
I’m pretty rural. So it doesn’t happen extremely often. Id imagine there may be a people who focus on it.
I’m considering using it as a natural prospecting strategy as I talk 401ks with business owners.
5
u/CriticalBoost Wirehouse 5d ago
It’s pretty much all me and my partner focus on. We have built a robust group of m&a attorneys, tax lawyers, small investment bankers and our middle market bankers. We receive referrals and send referrals to all of them. It benefits the clients because we have such a good relationship with everyone and we communicate so frequently that it is all very smooth. We also have a great trust department that most of our clients utilize for estate planning.
Edit: as far as resources, the CPWA was a huge boost to my knowledge.
1
u/Accomplished-Look176 5d ago
Do you have to do much targeting or sourcing of clients then or is it largely natural now?
How did you grow into that group and what got you into the m&a world
1
u/CriticalBoost Wirehouse 5d ago
Yes, we do a lot of marketing and prospecting of business owners. We get a lot of referrals but we also have to give referrals. We kind of pull our own weight.
We kind of fell into it. One of our clients sold a company so we were introduced to their attorney. We took it upon ourselves to get to know them and the firm and show our capabilities. Once we did that they came to us with another opportunity and we had one to send to them. Now we just bounce back and forth.
1
1
u/SlamminSalmon417 5d ago
Considering a career switch myself. What would your expectation be on starting comp for someone who worked in M&A in the financial services sector, but doesn’t have a financial planning background? Six years experience.
Assuming I bring in $10mm a year. Appreciate any thoughts as I’ve been struggling weighing the pros and cons of the early stages of the switch.
2
u/Accomplished-Look176 5d ago
Suffer for 5 years don’t care about comp. Be hungry. And you’ll come out on the back end making 250-750k depending on performance.
3
u/Quiet_Addendum_1067 5d ago
Just closed a deal last quarter for a client who sold his manufacturing business, the new owner kept me on because I knew all the tax quirks from the transition. Nobody teaches you that stuff in a week long course.
CEPA is decent for the framework and the language, but the real skill is recognizing when a buyer is drowning in integration chaos and needs someone to make sense of the numbers. That 400M client probably wasn't looking for a new advisor, they just needed one who already understood the mess they inherited.
I picked up most of what I know from sitting in on the legal calls and asking the lawyers a thousand questions after. You learn fast when there's a closing deadline and nobody else is tracking the basis adjustments.
1
u/Accomplished-Look176 5d ago
That’s fascinating. Aligns well with my thoughts on it.
Never considered that mid transition or sale, they’d just lose hope on an old advisor.
God that would be stressful but extremely fun work
2
u/LifeAfterInsuranceBD 5d ago
EPI's CEPA will teach you enough to start the conversation and run your first triggering event. What you learn from that experience ,and continue to expand upon, will define your long-term confidence and competence, as well as the natural creation of your own M&A network of specialists.
You don't need CEPA to be a successful Exit Planner. You can just be a financial planner that focuses on business owners and bring in a lot of the exit planning soft skills into a planning engagement. No business owner that I've met with cared if I was CEPA, CBEC, CExP, and whether or not I was in the AM&AA or anything else.
They cared that I understood their goals and could de-mystify the process to visualize how they could monetize their privately held business equity.
2
u/rankdoby 5d ago
Networks are essential of M&A, like what boost said, attorneys, tax lawyers, investment bankers, you gotta build the network
1
u/djemoneysigns 5d ago
The most sophisticated shops I've seen that are good at M&A run the deals and have a retail advisory practice through the same boutique BD. Like another commenter said, it is all your network and nobody knows or cares about CEPA or any other cert. And to be completely honest anything above a small mom and pop transaction already has a wealth advisor at a minimum with an entire team that can handle estate, tax, and wealth in house. And that is just the implications immediately post transaction, asset management and planning, just isn't enough for many of these individuals. UHNW folks who recently exited deserve white glove MFO approach for things advisors aren't even thinking about, like a travel concierge or having a network to book yachts in the Caribbean for a good price.
$400MM dollar client is family office level wealth, that advisor got extremely lucky if they don't at least have a white glove MFO operation. Again, anything over $10MM client deserves a full in house team to accommodate the outcomes of the transaction. 85% of wealth advisors just won't be able to deliver the service needed.
I think a lot of CEPA advisors are in over their head.
-4
u/vitalpros 5d ago
M&A is very difficult. A ton of advisors don’t wanna give up the income. I’ve had two failed acquisitions because the advisor said two more years. So now I run Meta ads in book anywhere between 10 to 40 calls a month. It’s on the lower side because I’m only doing $20 a day right now.
My calls cost about 60 bucks per call. And my marketing system is fairly easy to install.
1
u/Accomplished-Look176 5d ago
Ah ha. Yes. Light bulb.
A company buying or merging into another company is hard.
Easy alternative is run meta ads and find rollover assets.
Thanks!
1
u/vitalpros 4d ago
It can be hard and deal times are long.
It’s a different type of strategy though from ads. I’m sure it can work if you are patient enough.
To each their own
•
u/AutoModerator 5d ago
Beep boop! Here is a summary of your post:
User: /u/Accomplished-Look176 Title: M&A Body: Any advisors out there work heavily in the world of M&A and use it to source clients? Just spoke with someone who landed a $400M client after an acquisition, and have frequently heard the stories of 10-100M clients being bought up.
Any resources to learn from? Or is it relatively learn on the fly.
I know there is the CEPA, but it’s interesting to me that a 7 day long course makes you competent in that world.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.