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Consider This Before Teaming up with Another Financial Advisor

By ClientWise | June 5, 2014

At ClientWise we work with a lot of financial advisors who are either considering partnering, or in the process of partnering, with another advisor. The temptation is not unfounded. In addition to providing companionship in what can feel like a lonely business, there are obvious financial benefits as well. Practices that form financial advisory teams with multiple partners generate on average 38% more revenue per team member and manage 97% more assets per team member than their single owner peers.

This can be a tricky process, however, and one that shouldn’t be taken lightly. Like any venture, it’s easier to discover your path in the process if you actually start moving in that direction. Here are some things to consider that will help get your wheels turning, both before and during the partnership process:

1. You’re not just sharing a business. The success you’ve had relies on the relationships you maintain, which are built on trust in you, not just trust in your business. This is crucial to remember when you bring on another advisor to work with your clients and centers of influence. You want to be consistent in the way you build relationships with and serve them, so keep this in mind when considering a potential partner.

2. If you’re going to partner, truly partner. There are numerous scenarios in which it makes sense to partner with someone else. In certain instances it’s to expand the size of your business, in others it’s to expand the breadth. Understand what you’re seeking out and if it makes sense to partner with someone who either compliments your business or overlaps in your business. In the latter case, find your niche with the other person based on your over-lapping current client base and mutually agree to stick to it.

3. Consider the outlier clients moving forward. This is a great place to assess how you can hone in on your ideal client even more. Start with your current combined client base and look at what falls outside the “niche” you’ve established together, or else the expertise you each bring to the table individually. Figure out if it makes sense to pursue these “outlier” clients moving forward, or if there is someone in your professional network of advisors, outside of yourself and your partner, who is better suited to working with them.

4. Inform your staff of the benefits a partnership could provide. Ideally, your employees are engaged enough in your business to work with you in the selection of your new partner, and in the partnership process itself. Involving your staff in these decisions early on will engender their trust and encourage their investment in the future of the business, and in the future of their careers. Your staff is likely part of the team you’ll build after partnering. A partnership opportunity could mean incredible things for everyone moving forward, and the transition will be increasingly smoother the more open and honest your communication is with all involved.

5. Ask your coach, or select one together with your new partner. Coaches provide incredibly important support in transitions like this, which almost always require an objective opinion. Coaches can also provide guidance and accountability from a practice management standpoint along the way, to actively address the opportunities that exist within the partnership, and help you navigate any challenges it might bring along the way.

6. Keep your clients informed.
While the idea is to make the joining of the two businesses as seamless as possible (to the point that your clients aren’t at all affected by the transition), they will appreciate being informed in advance. This way, they will feel they have been communicated to, and can appreciate the mutual benefit the partnership brings.

These are just a few considerations to help you begin thinking more clearly about your partnership process.

Coaching questions from this article:

  1. What is your reason for partnering, and what does it ultimately do for your business? 

  2. Are you considering partners that compliment your business, either by bringing in new and related skillsets, or by expanding the base of business?

  3. How involved is your staff in the process? Are you considering how they could potentially work with you on a team as you partner and grow your business?

  4. What impact does partnering with another advisor have on your clients? Are you in a position to fully understand and communicate the benefit with them?


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