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The People in Your (Dealmakers) Neighborhood: Part 3 – Meet Your Financial Advisor

The Anatomy of a Deal Newsletter

This month, we continue our walk through the Dealmakers Neighborhood by meeting the financial advisor.

We oftentimes have conversations with sellers who are about to sell their businesses and trade the ongoing income stream of the business for the chance to have a Brinks truck back up to their door and unload. But soon after the initial allure of the big, sexy offer wears off, the question soon becomes: Is that going to be enough?

Enter the financial advisor. Most people are generally familiar with the concept of what a typical financial advisor can do, but relatively few understand the full breadth of expertise that a good financial advisor offers and when you’ll need a different financial advisor to help with planning for the kind of generational wealth that can come with the sale of a successful business.

To help us better understand all of this, we’ve invited our friends and financial experts Jon Eesley and Clayton Hall from Windsor Advisory Group to help us dig a little deeper into the role of the financial advisor, particularly for sellers in M+A transactions.

In this article, we’ll use the term “financial advisor” broadly just to avoid confusion, but know that there are all kinds of different advisors, with different titles and different areas of expertise, planning tools, investment offerings, etc. It’s impossible to cover them all in this short piece. There’s a lot of diligence required in order to find and select the right advisor. After all, you had better really know and trust the advisor you’re giving your money to.


Financial advisors come in all different varieties and are often asked to play many different roles for their clients, ranging from the more traditional investment advice to customized strategic planning for a whole host of personal, family and financial goals that a client may have. There aren’t any one-size-fits-all advisors that provide the same levels of service and expertise for all clients.

What does the financial advisor do and why is he/she an important part of my deal team?

When thinking about the role of the financial advisor in the context of an M+A transaction, it would ideally be something like this.

  • Develop the Plan. Lead ongoing, high-touch discussions with the client to help develop and refine personal goals and create a strategic plan to accomplish those goals. The key areas to consider are:
    • Personal
    • Business
    • Family
    • Community and charity
  • Ensure the Deal Satisfies the Goals. Align the deal (or select a deal, when there are multiple options) that best aligns with these goals. In this process, a good advisor also works to reconcile any conflicts between these goals.
  • Focus on Financial Security. Prepare a plan that is designed to provide continued financial security after the business has been sold. The key question your financial advisor should consider is how much you “need” vs. how much you’ll actually get. If there are gaps, then you’ll need to consider whether the deal will actually satisfy your goals. Sometimes a deal that looks great at the top line doesn’t actually provide sufficient net after-tax proceeds to maintain the client’s lifestyle.
  • Understand Tax Planning. The only financial metric that truly matters is what the client gets to take home. As such, tax planning is critical and will include both income taxes and transfer (gift or estate) taxes. The financial advisor’s role in tax planning is to suggest, support and contribute to the various potential tax-planning opportunities that a transaction might provide, and also to recommend other potential areas for tax planning after the transaction closes to help ensure a tax-efficient result for the client.
  • Represent the Client’s Personal Needs on the Deal Team. All of the deal team members (from the CPA to the investment banker) are focused on getting the deal done, and all of them care about achieving the client’s goals. However, the financial advisor—as an active member of deal team—has the benefit and responsibility of being the only advisor who is singularly focused on the client’s personal goals vs. closing the transaction.

When should I get my financial advisor involved?”

Our experience is that the sooner an advisor is brought into a pending transaction, the more he or she can help. That said, we respect that a pitcher throwing a “no hitter” (the pitcher being the business owner in this analogy) shouldn’t be distracted with a new coach late in the game. But if brought in early during the process, your financial advisor can provide objective advice around the why, what and how of a potential transaction – all integrated with the owner’s personal planning goals. And a good advisor will allow an owner to navigate the transaction with privacy so that vendors aren’t hounding them for business based on the owner’s new-found liquidity.

How does the financial advisor get paid?

Financial advisors get paid in a variety of ways, each with its own pros and cons. Using WAG as an example, our clients engage us in one of two ways – either a fixed-fee retainer or an “assets under management” (AUM)-based fee. It is important to know that some financial advisors may receive compensation from investment managers or other vehicles in which the advisor places client funds through success fees or referral fees, though Windsor itself earns revenue solely from its clients. Transparency is key here- the seller should absolutely have a full and frank conversation with any potential advisor about how they are compensated and consider what effect those incentives might have on how the advisor behaves and the strategies they recommend. 

Next Month: The People in Your (Dealmakers) Neighborhood: Part 4, Meet Your Attorney

Read last month’s piece: The People in Your (Dealmakers) Neighborhood: Part 2 Meet Your Investment Banker

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