The Final Firm Guide

At LaSalle St., we are not in the business of convincing an independent advisor to switch firms. But when an advisor tells us they are considering a new partner firm, we like to take a consultative approach — and we always give one piece of key advice.

Do everything you can to ensure you are joining a firm where you can finish out your career.

In other words, get this right and make your next move, your last move. What follows is the framework we walk through with every advisor we meet.

Every new opportunity that comes our way is the result of one, or multiple, negative experiences or developments at the current firm. Before an advisor officially kicks off a search for a new partner firm, there must be a specific catalyst that energizes the advisor to seriously consider making a move.

The first thing an advisor must do is get specific about their catalyst(s). Write them down. Be very clear about how and why the problems your business is currently facing must be solved by your next (and final) firm.

• Inconsistent and unaccountable service.
• The firm is clearly prioritizing growth at the expense of supporting existing advisors.
• High annual cost of doing business, lack of transparency around fees and expenses, or the introduction of new advisor costs.

Remain focused on your catalyst(s) during conversations with recruiters. You want to drive these conversations. Remember, the recruiter's goal is to discuss their firm's strengths and steer clear of their weaknesses. If you are clear and direct when explaining your reasons for seeking a new partnership — and you consistently bring conversations back to your catalyst(s) — you will more quickly identify the firms that are a good fit for your needs, and you will protect yourself from getting sidetracked by sales-oriented conversations.

This is your business, your future, your decision. Take control of every conversation.

Keep this phase simple. Finding the right partnership doesn't require an exhaustive search.

Here's the truth: your catalysts can be addressed by many firms. You don't need to interview ten firms. You need to find three to four solid options to compare. If you are reading this, you've already found one.

1. LaSalle St.
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Tell recruiters you are looking for a firm you can partner with for the rest of your career, and make a list of your Must-Haves. Tell them these are your Non-Negotiables and they will ultimately drive your final decision.

• Maybe you are seeking a higher net payout.
• Maybe your new firm must provide a solution to retire an existing forgivable loan.
• Some advisors will only join a new firm if they can acquire equity ownership.
• Maybe you must see a clear opportunity to buy a book or to establish a succession plan.

Be up-front about your non-negotiables and tell recruiters exactly how they can best position their firm to become your final firm.

At this stage, it is also important to assess each firm's culture and the character of the people you're considering partnering with. Non-negotiables often come down to exceptions and extra effort. If a firm is willing to do more for you than they do for most other advisors in an area specifically important to your business, that is a good sign.

That said, don't expect to get everything you ask for. All firms have limitations and everybody must draw the line at some point. Share your non-negotiables and attempt to customize the partnership — but be realistic and be willing to meet your potential new partner in the middle.

When you reach this stage of the process, you are ready to visit Home Offices. Take the time to meet the firm's team in person and make an effort to begin forming honest and transparent relationships with the people who will support you for the rest of your career. During your Home Office Visits, make it your goal to determine whether the team is passionate about what they do. You should also ask for an introduction to the ownership team and ask tough questions to determine whether the firm has a concrete plan to remain independent over the long term.

At this point, you have probably already ruled out a firm or two. That's great. Eliminating firms from your consideration set is proof of a functional and worthwhile due diligence process. Keep moving forward, don't overthink, try to keep your search simple and organized.

Do you want to do business with these people?

Who, specifically of the people you've met during your search, can you see yourself partnering with the best? Some advisors pick a firm because they trust and feel comfortable with one or two specific people at the firm. There is nothing wrong with that. Wealth Management is and always will be a trust business.

Do you believe these people truly care about their firm and its legacy?

If you are looking for your final firm, you ideally want to make sure most shareholders of the firm you choose are explicitly opposed to the idea of selling the business. Join a firm led by passionate people who care about their legacy and the company they've built.

Of the remaining options that seem like a strong fit, you'll have to fall back on the common sense and people skills that helped you build a successful business in the first place. The best advice we can give you is to go with your gut feeling.

Choose your firm first. Negotiate the offer second.

Once an advisor confidently chooses the firm and the people they want to partner with, economics almost never hold up the deal. When you've made your decision, the first thing you should do is deliver the good news to your final firm. Being transparent works to your advantage — recruiters and firm leadership are far more willing to make concessions when they are confident an advisor is committed to them and not shopping their offer.

• Make sure any promises made during earlier stages of the process are presented in writing within the final offer.
• Ask for a specific projection of your gross and net revenue based on the payout split, platform fees, and all other associated costs. Is there an affiliation fee? Does the firm markup E&O insurance? Is there a fee for holding assets off platform? What else?
• If applicable, make sure the firm walks through the forgivable loan agreement and transition assistance package with you.
• Based on your projections, you'll be able to determine how much you will pay annually for the relationship and the firm's break-even on investment. If the firm breaks even after a few years, why be contractually obligated to stay for seven? Make a list detailing the ways in which your final firm will add value to your business and make sure that it justifies the annual cost of the relationship.
• Avoid sticker shock. If you plan on being in business for more than five years, you should seek an offer for the long term. Strongly consider asking the firm to design an offer with a lower annually recurring cost of doing business in exchange for a smaller "up-front" check.

If you want to discuss the economics or contract language of any offer currently on your desk, do not hesitate to reach out. Thank you for reading. You are now in an excellent position to begin your new firm search.