PLANADVISER - March/April 2022 - 26

growing your practice / succession planning
The Means to a Graceful Exit
Of surveyed advisers without a succession plan, roughly
56% said they expect to create one sometime in the future.
The remaining 44% of those advisers-or about one in five
of all respondents-have no plan to transition or sell their
business and do not intend to form a plan.
Wilson Hoyle, managing director and head of
CAPTRUST's Advisor Group in Raleigh, North Carolina, says
such figures are not surprising. He says many smaller firms
in the marketplace are inundated with serving clients and
attempting to grow their practice. He says CAPTRUST, for
its part, has had strong success in helping its advisers retire
smoothly, mainly because of the resources and experience
the large national company can bring to bear in support of
its people.
A global company known for acquiring smaller adviser
firms is insurance broker Hub International Ltd., which
made news in January 2019 for purchasing Sheridan Road, a
Chicago advisory firm with more than $14 billion in assets
under advisement. Sheridan Road co-founders Daniel Bryant
and Jim O'Shaughnessy were both recruited to Hub. The
partners felt it was critical to take this path-to join a larger
entity that would enable the business to compete effectively
in the midsize- and large-plan markets, says O'Shaughnessy.
(Read our full discussion with O'Shaughnessy below.)
Although the COVID-19 pandemic changed many
things for financial advisers-perhaps most notably how
they communicate with clients-most financial advisers'
succession plans were unaffected, according to SmartAsset's
research. The survey shows that about 20% of advisers
created a succession plan during 2020 or 2021, but roughly
93% of financial advisers said the pandemic did not change
how their firm thinks about succession planning.
Of firms that did notice a change, most advisers point to
succession planning being seen as more of a necessity than
it had before. One adviser told SmartAsset that, with the
threat of COVID-19, a practice must consider " what happens
to [its] clients and revenue in a worst-case scenario. " Other
advisers cited their desire to benefit from the hard work
they put in over the years.
Several Approaches
Reflecting on the experiences of CAPTRUST's advisers,
Hoyle says, there is not necessarily one superior succession
planning approach, whether internal or external.
" We have had many examples where an adviser was
part of a team, and it is natural for him or her to take over
leadership of the retiring adviser's book; it is more or less
Competition and Succession
Jim O'Shaughnessy discusses the challenges of succession
planning and the process of merging his and his partner's
Sheridan Road practice into the larger Hub enterprise.
PLANADVISER: What role did succession
planning and firm continuity-along
with your own career outlook-play
in the decision to sell to Hub?
Jim O'Shaughnessy: I feel our decision
to join Hub has been validated by the
number of other transactions we've
seen, both involving Hub and looking
out across the industry. We [since the
acquisition, Sheridan Road co-founder
Daniel Bryant has exited the advisory
business] were fortunate to be in
the position to be one of the first
big transactions, and we had a lot of
confidence at the time that this would
be the right path for us.
I should begin by saying that a big
part of our success was that we were
able to create and maintain a longterm
vision from the very start. We
always had a formal three-, five- and
10-year vision of where the practice was
heading. From the beginning, we felt
succession planning was critical, both
for our success as business leaders but
also for our staff, for our people.
It was critical to us, as we looked
to sell Sheridan Road, to effectively
position our employees to have
expanded career paths and a much
broader opportunity for professional
development. That played a larger
part in our decision to sell than
most people realize-the fact that
we
could maintain pretty much
100% of our team intact, outside of
a few redundancies, and give them
O'Shaughnessy: In terms of discussing
Daniel's transition with our longan
opportunity for personal and
professional growth.
Additionally, a big part of the Hub
deal was about making sure we had
immediate succession planning at the
leadership level if anything happened
to us on a near-term basis. Now that
Daniel made the decision to leave Hub
and start another phase of his career, I
still feel very well supported.
PA: Without speaking for him, can you
tell us more about Daniel's business
decision to step away from the
adviser business? Has this affected
your strategy or your clients?
26 | planadviser.com March-April 2022
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PLANADVISER - March/April 2022

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