Podcast: How to Ensure Your Business Thrives Post-Acquisition

Mike Langford:

Hi, there. It's Mike Langford. Welcome to The Advisor Financing Forum, a podcast presented by SkyView Partners. This week on the show, Aaron Hasler and I are joined by Duncan MacPherson, CEO at Pareto Systems for a conversation about what you can do to ensure that your business thrives post-acquisition. Duncan is an expert at demystifying business development and marketing in the financial world. He has a special knack for helping advisors and leadership teams and RAAs get crystal clear on the steps necessary to take their business to the next level. If you are interested in acquiring a financial advisory business or selling your business, you are going to love this episode because our conversation with Duncan is packed with actionable guidance for you and your team.

Before we get started, as always, if you have questions about your specific M&A plans, please feel free to swing by SkyView.com or call (866) 567-6282, and the SkyView team will be happy to walk through all the options that are best for you and your business. Okay, let's get to our conversation with Duncan McPherson. Duncan McPherson, Aaron Hasler, wonderful to see you gents. Welcome to The Advisor Financing Forum Podcast.

Aaron Hasler:

Good afternoon, Mike. Glad to be here.

Duncan MacPherson:

Great to be here. Thank you.

Mike Langford:

Great to have you. I've really been looking forward to this one. Every once in a while, you know you're having a guest on the show, so you do a little bit of research, you do a little listening and consuming of the content that they've put out into the world and you're like, "Oh, this one's going to be a vibrant conversation. They're got to love this. Somebody's a pro on the show." By the way, Aaron, I'm not talking about you.

Aaron Hasler:

Oh, I'm sorry. I thought you were.

Mike Langford:

Anyway. Well, we wanted to have you on the show to talk about a variety of topics here, Duncan. But one of the things that I think is on every advisor's minds and every member of our audience's minds is rising interest rates, right? It's hard to ignore it. The Fed just raise rates by 75 basis points in a continued effort to fight inflation. Let's get into it. Many folks in the audience are wondering, "How does this affect my acquisition plans, right? Should I continue to take an aggressive approach, or should I pull back and keep my powder dry?" What are your thoughts, Duncan, as you're looking at this? You're not on the lending side obviously, but what are your thoughts as you see this environment changing?

Duncan MacPherson:

Well, raising rates, it's still relative, but as compared to what? It's higher than it was, but it's still almost in my view free money. That's what I said to a client the other day and advisor that's in acquisition mode and I said, "You've got to remember, even if you overpaid, you're still buying an undervalued asset because when you transition that business over to you, you're going to unlock so much dormant opportunity." The dynamic, okay, there's more buyers than sellers, that might be thinning out a little bit. I think the opportunity is to double down and capitalize on some of these dynamics that exist. Anyway, Aaron, I know you've got some comments on that, too.

Aaron Hasler:

Yeah, I mean, I agree on this. I feel like when we started SkyView and started commercial financing in earnest, this was where rates were, so we're kind of coming back to center. The pandemic created an opportunity for a low-rate environment that I think allowed advisors to continue to understand commercial financing and use that to their advantage. But yeah, Duncan, I agree, if the average firm is growing at maybe eight-to-10% clip, when you include market appreciation and a little bit of client growth, you're still surpassing what you would be doing from a commercial financing perspective, so I think it's still game on, and advantage buyers.

Mike Langford:

It's interesting. I think you guys are both right, and I tend to agree is that anytime you have a down market of any kind, it shakes some of the competition out, right? Some of the would-be buyers get cold feet and they sit back and so forth, people who were kind of resting on their laurels and their business suddenly start having some problems because if we head into a recession and we've seen some down markets in the stock markets and so forth, you see some advisors get a little nervous. That's the time the pounce. This is when bigger businesses are built is when we're in a little bit of a market turmoil, right?

Duncan MacPherson:

Well, I'll just actually build on that because I had a consultation last week with a team about this very topic and I asked them just to really expand their thinking about what they were actually doing. In literal terms, you're acquiring a business, but there's so many more layers to that. First of all, to be worthy of acquiring a business, you've got to get your own house in order, okay, so as a proof of concept, you have to really refine and optimize your organic business, make that process-driven, put it into a playbook of intellectual property.

It's like staging a home to maximize its value, but you're not staging your business to sell it. You want to adopt these best practices so that then when you go and acquire that business, there's a multitude of benefits. My expectation is you go out and buy a hundred-million-dollar business, you transition those clients over to you and elevate their client experience. At a minimum, you're going to unlock $20 million in assets that were dormant in their previous environment. Look at the lift that comes from that.

Then you start to get scale and efficiency through best practices. It's a force multiplier. Then by going through the exercise, and I'm getting way ahead of ourselves here, but once they've gone through that process, they can also simultaneously attract other advisors who are tired of the minutiae and the hassle factor. They still love what they do, but effectively, they want to draft in behind the process of someone who's got scale, so now, not only are they acquiring, not only are they getting their house in order, they can build out on B2B level, attracting other advisors to create that enhanced force multiplier. I just want everybody to have a full panoramic view of what the benefits of this exercise really are.

Aaron Hasler:

Duncan, when you see a market like this that's up and down, what are some of the things that you see elite firms doing to attract more clients? Are they staying with that same consistent approach? Are they expanding their marketing efforts? 'Cause that's the opportunity I see right now is not only is it just acquisitions, and to your point, that addition of service and providing a continuity plan, our fantastic add-ons, but I would imagine that this kind of up-and-down market creates that flight to safety and is a tremendous opportunity for firms to gather more assets from their existing referral base.

Duncan MacPherson:

Well, I'm going to answer that briefly and succinctly and then I'm going to drill down a little bit if you'll indulge me. I'll go back to this team I was speaking with. When we met them way back when, they were a little over 400 million in AUM, great business, nothing wrong. They had every reason to be content. But plateau avoidance, they still were ambitious. Fast forward to today, they are well over a billion in AUM and I reminded them, I said, "Do you find it fascinating that nowhere in your elevation or evolution did you all of a sudden become a better financial advisor? But you were always good. What did you get better at?"

They got better at the things that most people either ignore or trivialize in terms of practice management and relationship management. He walked away from this notion that it's a book of business. That's so dated. It's an actual business. He became a CEO, he hired a COO, he ran the business like a business. He applied the same level of importance to practice management and relationship management as he did to asset management. In fact, he then started getting out of the management business. By that, I mean outsourcing what's commoditized to go deeper into what's proprietary.

Now, let me just build on that for a second because I want every financial professional listening in to understand their progression and the opportunity that is in front of them. When they got into this business, their initial fixation was on knowledge, right? Product knowledge, credentials, designations, historical interpretation knowledge, okay, but back then, this business was very transactional. They shifted in the spirit of professional contrast from knowledge to expertise, so instead of being transactional, they became directional, right? By that, I mean they shifted to advisory, shifted to being fee-worthy, they added depth and breadth to their solutions. They became process-driven, added to their bench strength, okay, so now, we're on the next frontier from knowledge to expertise to intellectual property.

What that ultimately means is every investment of effort that they make working on their business and getting everything out of their heads, if it's in their heads, it's a skill. If it's documented and process-driven, it's an intellectual property. That drives enterprise value, that drives scalable growth, that depersonalizes, so the business is not dependent on necessarily individual people and their skills and intentions, it's built on process. It can be built out. If everybody will focus as a fee-for-service professional on building intellectual property, they can unlock B2C organic growth into B2B scalable growth, and in essence, become franchise-ready because their first acquisition, when they work through the kinks and the hiccups and the dust settles, their ability to repeat that and do it even more effectively the next time, I mean, it just takes on a life of its own. I just want everybody to have a full appreciation for what the opportunity is here.

Mike Langford:

I love the way you articulated that, Duncan, because one of the things we all love about this business is that it's based on math, right? I think a lot of times that why people get into this, I mean, whether you get into this because you're really a finance geek, or you got into this because you're a sales guy or a sales lady, you're driven by that, it's math, it's easy to understand the business, "If I do this, it produces this result, and if I have recurring revenue, this is what it looks like if I have this much AUM," and so forth. People love that.

But one of the challenges is it's not like a startup where we have this hypothetical potential valuation where it comes down to buying a business. Usually, that acquisition cost is also going to be based on math, right, "Here's how much your business has, here's how much revenue it produces. This is the type of cash flow I'm going to get from this business, so here's the valuation we're dealing with." However, what I hear you saying is something that I love to hear is that you got to look at the business based on the potential of the acquisition, right? It's not just what is the business today and what has it produced in the past. What will adding this new group of clients and maybe talent that you're acquiring from the other business mean to my business, right? It's what is the potential of the business.

Aaron Hasler:

Yeah, that's the thing that I find so interesting about our industry, and maybe others are like this as well, but I feel like we can get so nuanced into deal structure and the weeds. I was evaluating for a client last night this kind of convoluted, complicated deal structure that a buyer put in front of them, and it was all predicated on certain growth. What I'm countering with is exactly what you guys are both saying, which is here's the basics of it. We know what it is in a static point in time in terms of the math, but at the end of the day, there's this untapped potential of service that I feel like unlocks this and takes this firm up a significant notch. The growth potential in my opinion is really hard to quantify other than maybe saying yes, historically they had this type of growth, but now, you've combined, you've added that succession plan, you've expanded the breadth of service, and I feel like it's almost unquantifiable in terms of what the future opportunity is there, right?

Duncan, do you have any advice for people out there today as far as they start to create some of these processes and define their service models and define roles or hire those executives? What type of experience do they see and what kind of lift can they see in terms of the growth of their enterprise?

Duncan MacPherson:

Well, okay, before I answer that, I want to go back to something Mike said. We are in an era, fortunately, where there is a dual appreciation. Yes, the math is important, call that the science, but there's a dual appreciation for the art and science now, and so much of the science is being monetized. Remember, you can't count everything that counts. What really counts when it comes to scalable growth is really focusing on what's proprietary. You can decommoditize your business by outsourcing the minutia and what's commoditized to someone who has scale to liberate you to go into what's proprietary, which is the business and the relationships. That's where there is so much lift and upside.

Now, let me connect that to your question. Believe it or not, I actually tell my clients, I say, "I really actually in the beginning want you to detach from an expectation on a measurable outcome. I want you to immerse yourself in the activity. Trust the plan, stick to the process, keep your head down, and let cause and effect work its magic." Yes, you are going to get to a point of quantifying your returns, but I want you to look at the qualitative aspect of execution of best practices. Cause and effect always works its magic.

That's probably not the answer you wanted to hear, but this business is so abstract. There's so much delayed gratification. You have to focus on what matters and what you can control and just be at peace with the way things play out. There's this principle that says if you can't measure it, you can't manage it, and that has become a bit of a fallacy as it relates to acquisition because you need to focus on the unmet needs and the things that are not being implemented on in the world of best practices and they will pay dividends, so it's a dual approach.

Mike Langford:

I love the fact that you brought in the things that are non-commoditized, right, because very often I've actually used this phrase many times. Most of our business is commoditized. We all sell the same stocks, bonds, and mutual funds. We all have access to the same basic services, and basically, most advisors are charging around the same price for that type of work, for managing assets, and so forth.

But what I also say is something you just said, is like, "Listen, your clients didn't choose you because you have access to stocks, bonds, and mutual funds, right? They chose you because of you. It's a relationship. They related with you. You were the guy, the gal that sat across the table from them, and you're the person I want to work with and you make me feel confident in my financial future. Therefore, I'm going to entrust my money with you. I'm going to entrust my plans with you and the like." If I'm hearing you correctly, that can be kind of business-ified, if you will. You can make that more consistent.

Duncan MacPherson:

Oh, yeah.

Mike Langford:

You can make that something that is replicable and a foundation of your business. That was one of the big questions we had in prep your conversation with Katie, for instance, one of the things I jumped into my AirPods as I was listening to it was that you often talk to advisors and try to get them to elevate their mindset beyond thinking of they have a book of business and to thinking that they have a business, right, that they're a business owner. In order to be a successful business, what sets you apart from a regular business is that things are replicatable, right, that you got processes, and there's consistent way of interacting with clients, consistent ways of operational processes. What in your mind does it take to make a firm more consistent in their client approach, for instance?

Duncan MacPherson:

Well, Aaron and Mike, I want to say something that will start to connect this and it'll start to build on itself. Aaron, you referenced service a few minutes ago. This is a very important distinction as well. As we all know, client service is how a business professional responds to a need or an issue or how they put out a fire. It says, "Okay, I've got a high decorum and code of conduct. I care, I'm professional." 'Kay, you got to bookend that mindset with client experience, client service is how you respond. Client experience is scheduled. It's predetermined, it's thought out, it's documented, it's client-facing. It's when a financial professional says to a client, "This is what it means to be our client. This is what you can expect from us. These are your days. This is our process."

Why this is so important? A, because it's proprietary, B, it shifts the focus because there are so many brokers out there who still have a book of business, who have clients that really focus on products, pricing and performance. That's flawed. What a financial professional wants is a client who doesn't buy something, they buy into something, what they're buying into is a meaningful relationship with good people, a solid practice, and a panoramic process.

Now, I'll give you an example of how this works because there's all kinds of canary in the coal mine examples that we hear. For example, financial advisor has a great client, $12 million, zero hassle factor, a joy to work with. It's such a great relationship that this client refers his sister to the advisor, the sister, a little younger, not quite far down the track, a million dollars. A little while later, after the dust had settled, the big client said to the advisor, "Hey, I really appreciate you bringing on my sister. She's really happy. Hey, question for you. I'm curious, She pays the same fee I do, but obviously, your compensation for me is so dramatically higher. What is it I get that she doesn't get?" I mean, fortunately, this advisor went right to client experience, and his service matrix, his ideal client profile. He said, "Well, your sister, I accepted her as a client because you introduced her to me. She's important to you, she's important to me. She's not my ideal client. I don't try to be all things to all people. You are my ideal client, so her experience is very different from yours." Then he explained it.

Now, this was a huge wake-up call for the advisor to understand what fee-worthiness looks like. But it goes into process, client classification, segmentation, a service matrix, a service model. All of this has to be client-facing. You have to be able to show you can't be your own best-kept secret, this hiding behind the curtain. This has to be front and center, forthright, and transparent. I want every advisor to understand that these are replicable procedures that will put so much distance between one advisor and the pack if they will adopt this. But again, long story short, the distinction is products, pricing, performance or people, practice, process. Choice is yours.

Aaron Hasler:

When you're looking at that, especially for an acquisition opportunity, I would imagine that it's that client experience that ultimately ties those new clients in. They've had a certain process maybe at their old firm, they've had a certain client experience, but what means more to that client that's transitioned to a buyer's firm? Is it that client experience, or that client process, or does it really depend do you think on the predecessor, or the outgoing advisor?

Duncan MacPherson:

Oh, that's a very good question with many layers: consistency, no deviation, professional contrast, professional scarcity; there's so much to that. I will give you an example. I'm working with a team right now that is positioning itself for its first acquisition, 'kay, so it's not there yet, but they are engineering this in real-time. The lead advisor's growing upmarket, he's starting to get introduced to some very significant clients that meet his ideal client profile. This has all been engineered.

What's interesting is he got introduced to a client that was substantial in terms of their assets, but disconnected around attitudinal compatibility, and how it was revealed was the advisor said to the prospective client who was referred by an accountant, he said, "This first meeting is just a fit meeting to see if we are aligned and if we see the world the same way. There's no expectation, nobody has to get too deep here. Let's just see if we're compatible." The prospective client had no interest in that. He wanted to talk about how he managed his portfolios, he wanted to get into the weeds in the first meeting, and the advisor said, "Well, no, that's not my process." That person went somewhere else and the advisor was disappointed. I said, "That was a meaningful prospective client, but not a good fit. If you would've accepted that person and you would've deviated, you're not being congruent. You're undermining the whole approach."

Now, compare and contrast that to another introduction. First meeting, "What matters to you? What's important? Where do you see yourself?" He was very, very qualitative, compatibility-focused. The prospective client revealed that he really liked cars, really liked golf. The advisor liked cars and golf, so he had this great exchange, and then the prospective client said, "Hey, you know what? At the end of the day, all that really matters to me is anything happens to me, I want my wife and kids to be looked after. Is that part of your approach in your process?" Then they went up and played golf. It's working. I just said to him, "Compare and contrast. You have to be consistent. You can't deviate. You can't be all things to all people. That person's not a good fit. This person is a good fit. This affects, there's a ripple effect to every other aspect of your business. You have to standardize this."

Long story short, guys having an ideal client profile that's panoramic and all-encompassing, sticking to it heartedly, telling the world, "It's not about who I'm looking for, it's who I'm suited for," that congruency, that consistency impacts, it permeates throughout the entire experience.

Aaron Hasler:

Duncan, I like that example because that's the thing that we always talk about when we're working with clients and helping them identify a buyer is we're going to them and saying, "Yes, process may change, right? There are certain aspects, there's different ways to peel back that onion, or slice things up. But at the end of the day, it's that client experience and that consistency."

If I have professional respect between two firms, so you've got outgoing leader that identifies with and understands the process that buyer has put together, but then they can share a common experience, or on terms of how they service those client, that really makes a significant difference to me in terms of the retention of the overall clients, and the expansion of the practice, right? That's why I think they're buying that opportunity, you're finding that fit in that feel that allows you to say, "Here's our back office process, but here is our experience and that experience, we think, as we expand our enterprise and as we have more scale, you're going to be happy with this buyer because of that client experience, and I can guarantee that that's going to be a good outcome for you."

Duncan MacPherson:

Well, that nuance and that predetermined approach, I'll give you an example of a team in Texas, and I can't remember if I'd referenced this in my conversation with Katie, but a team in Texas acquired a business from an advisor who was retiring. It was so well-thought-out, so process-driven, literally to the point where the acquiring advisor said, "We don't want you to ride off into the sunset. We'd like to retain you as a consultant and we're going to insist that you become our client so you can experience what your clients are going to experience."

Sure enough, they wrote up the documentation so it was effectively a sell and stay, sort of, and onboarded the advisor as a client, fit process, onboarding process, service model, textbook. The advisor was blown away, so it validated that he made the right decision, but then his ability to go and prime the pump with his clients and effectively say, this was all scripted and predetermined, basically saying, "Look, my clients have been asking me over the last couple of years what happens to us if I'm not here anymore, so I got out in front of that and addressed my continuity and succession issue, substantial due diligence. I couldn't be more excited because we've selected this team and let me tell you why." He got very, right, about the process and their client experience and things like that and he literally said, "I'm so excited because I'm going to stay as a consultant through the transition and I myself am now a client of this firm."

Aaron Hasler:

You're gonna get a client, yeah.

Duncan MacPherson:

It'll be up to you if you see the merit in transitioning from me to this team, but they have a fit process, you'll come to your own conclusions. It was so incredible.

By the way, I might add they did the entire transition virtually because of this nonsense we've been going through the last couple of years. When they transitioned the business, they never even met the clients in person. They did it all like this and they unlocked so much dormant business in that transition. Now, of course, the dust settles, and I think they're on their third acquisition now.

It's incredible, when you get into the granular best practices of, "How do you position this? How do you communicate and articulate this to the client? Are you saying to your client that you sold your business and therefore sold your clients to somebody else? Or are you saying, 'Look, I've made the decision now it's your turn to make the decision if you see it, the merit'?" It's a fit process, not a transaction. Oh, my gosh, it's so well-executed and everybody, and that advisor, his legacy is secure, his sense of fulfillment is secure.

Aaron Hasler:

Yeah. Duncan, I think you and I share all the same clients because I love these experiences. I feel like we could go on and on with these types of stories of these success stories. What are some of the things that you think that advisors that are buying practices or that are interested in buying practices should be doing? Because I feel like this is something that a good buyer's got to have that process already in place. They've got to be confident in their client experience, but also maybe open to adaptations or adjustments to that, right? What are some of the things that you're asking or seeing that advisors are implementing today? Are they attacking their process first or do they attack their client experience when they're talking about preparation for acquisitions?

Duncan MacPherson:

That's a great question. It's a little bit counterintuitive, but okay, so I have a friend that went to sell his house, got an offer conditional on the home inspection, and then the whole thing fell apart. I told him, "You do the inspection before you accept an offer. You do it. You pay the money, you show them the report, and you can say, 'Hey, if you want to do your own inspection you can, but this is what we revealed. This is what we addressed from that report and this is what you've got.'" Do it in advance, okay, so take that mindset. I tell every advisor before they even think about acquiring, "Yeah, you want to see if you're capable from a monetary perspective, you qualify, can you secure the funding? Yeah, that's important, but get your house in order."

Basically, what I say, and I'll make this available to anybody listening in from the SkyView community, okay, I will make available access to a practice management index. It's called the PMI. This is a self-guided resource where they invest about 45 minutes of their life answering questions in this incremental approach and it produces a report on where their own gaps are. Every team has got six to eight gaps that they need to get clear on and can address. I'll make this available because what happens is it makes them acquisition-worthy because it's like, okay, I want to acquire a business, I want to transition this business, and have a draft in behind mine, but I need to earn that, right, so let me demonstrate to you, not just that I have the financial wherewithal, but your legacy and your clients are secure and in good hands, and in fact, elevated. It's not that you were doing it poorly, but when they come over to me, they're going to be so dramatically elevated and happy with that transition.

That's all curated and engineered. That PMI, practice management index, Aaron, I'll make that available to anybody who sees the merit. They'll know where they stand and what they need to address. You know what? Honestly, it takes about three to four months to address those gaps. Their ability to achieve a professional contrast, like if Mike, for example, is selling his business, and he's vetting three advisors, it won't even be close. He will know based on the way I conduct myself that he's in way better shape coming with me. I don't have to convince you come to your own conclusions. When I demonstrate the strength of my people, my practice, and my process. That's done in advance before they even meet with a seller, we can provide that as a starting point.

Aaron Hasler:

I love that. I think that's super interesting because certainly when you look at the SkyView ecosystem and what we've created with commercial financing, one of the things that we wanted to do was really allow advisors to compete and win over practices and be able to buy into a practice that they might not otherwise be able to do without the availability of commercial financing and potentially even compete against some of these private equity back to aggregators or acquiring firms that really have a smooth client process and client experience, right?

I love the idea of buyers that are out there looking for practices to be able to not only evaluate their existing process and client experience, but then maybe be able to write that down and share that because that's something that we look at when we're helping evaluate buyers is to say, "Okay, what are we going to see on the other side when the advisor is out the door and he is written off into the sunset? What is that client experience?" For buying firms to be able to go out and demonstrate that and articulate that upfront, I think, makes a significant difference in your ability to go out and find the right partners to go out and buy and integrate their practice.

Duncan MacPherson:

Well, Aaron, I'll actually frame that in a structured approach. Just a little role-play here, let's say you are the seller and I'm the acquirer and we're meeting for the first time, virtually or in-person, and I plunk an agenda on the table, it shows how this meeting is going to unfold and everything speaks to is there an alignment and a good fit? One of the first bullets speaks to my philosophy and my philosophy shaped in this context with PSP. What is PSP? Philosophical, strategic and practical fit. Philosophical is we see the world the same way, okay? It's all about what's important to the client. How does the client benefit from this, okay? We're not brokers, we're consultants. We use no salesmanship. We're all about stewardship. We have lifelong clients. We have second and third-generation clients. We only accept new clients that are introduced to us. That's our philosophy.

Strategic is do we have a process in place that will ensure that after you and I shift from intent to consent and now the work begins and we have to actually bring this together? Do we have a well-thought-out process in place?

Then practical, do we have the means, the financial means to acquire this business? If a buyer can start a meeting and set that expectation and then future pace to demystify what this looks like, everybody else is going to look like an amateur. It won't even be close. Somebody else could even offer more money, and it'll be like, "No, no, no, no. My legacy, my client's far more secure with this based on PSP," so we've got all that built out, too.

Mike Langford:

Yeah. First of all, I got to go back to something you said that we've been doing podcasts on and having conversations about acquisitions for a long time. You mentioned something that I have not heard a single time, which is the seller should feel comfortable being a client of the business that is acquiring his business.

That just seems like such a no-brainer, right? If I sold any other business in the world, I should want to continue to be a customer of the acquiring business, right? I should want to do that, right? If I sold a restaurant, I might still go to that restaurant, right? Because I started that restaurant, somebody else bought this restaurant, it's now part of this group, of course, I'm going to still eat there. Well, I think the same is true for this business. If you're sitting across the table from a would-be buyer. As you're evaluating that team, ask yourself, would you feel comfortable having your money there? Would you feel comfortable in the process and with the people's personalities that are going to be interacting with on a daily basis? Well if you would, then hopefully your clients would, too, right? By the way, what a great show of faith. That is the biggest nugget I've heard in a long time. I love it. Fantastic stuff.

Duncan MacPherson:

Sorry, Mike. Let me just pounce on that one, too, because I'm constantly reminding my clients. I say, "In every consultation we have, I want you to imagine that a client of yours is listening in. Would they feel like they're upon a transaction or they feel like they really belong to something?" I say, "This is more about continuity and succession, liberation, and order." Here's the irony, your clients have continuity and succession and family investment, legacy issues, and the best way to be indispensable to their client's issues is to address your own in real-time, so get it right, and then talk to clients about how this benefits them so in no way, shape, or form, do they feel like this was a transaction. It's just a mindset.

Mike Langford:

Yeah, yeah. That's right, that's right. When your financial advisor mentions that he or she is selling their business, one of the first things that might go through your head is like, "Oh, that's interesting. I'm going to be changing financial advisors now. Hmm. Maybe I should explore other advisors," right? But if you get in that comfort level, "No, no, no, no. Not only is it going to be the same level of quality, it's going to be even better, and hope my advisor's not going anywhere he or she is continuing on and it will is making the same journey with me." Absolute fantastic stuff.

We only get a few more minutes together, but I wanted to make sure we jumped on one opportunity to, well, shamelessly promote you and share some of the new wisdom that you're sharing with your community. You've got a new book out. It's called The Blue Square Method. One thing that I found intriguing from the book's website, I haven't read the book yet, I just found out about the book yesterday, so take it easy, everybody in the audience, there's a little quote on the website that says "This actionable playbook is designed to put you on a predictable trajectory to ensure you never plateau."

I love that because I think many advisors won't admit it openly, but the data suggests most advisors have been plateaued for quite some time. Most advisors are not actively growing their business and bringing on new clients and new assets, and so this plateau concept, frankly, it's something that worries people. When you're buying a business, we're talking about exchange. We want to be thinking growth. We don't want to be thinking about, "Hey, I'm buying another plateau, I'm just going to go here." Talk to us a little bit about the book. What can somebody expect from it?

Duncan MacPherson:

On the topic of plateau, there's a little portion in the book where we pay tribute to Little's law. Little's Law says that the closer you get to your natural capacity, the more things tend to break down, and therefore, you're on a collision course with that plateau, so we spend a lot of time talking about how to effectively put more sand in your hourglass and find areas for efficiency and refinement. That is a big part of The Blue Square Method. But there's a quantitative and qualitative side as well to that because people plateau personally and professionally just before their business plateaus, so there's a direct correlation there. One thing that separates the best from the rest is the clay is soft, they have immense humility, they keep working on themselves and on their business, refining and optimizing, and they find a sweet spot between ambition and contentment. They have immense appreciation for what they have that fuels the aspiration for the things they want, and ultimately, Mike, at the end of the day, most limitations are self-imposed, self-fulfilling.

I know I have a client that's acquired 27 businesses or acquired or attracted within that 27 other advisors that draft in behind his process, full-on CEO having the time of his life. Now, if you would've asked him 10 years ago, "Do you see?" He would've said, "No, there's no way. There's no way I could get to where I am today." It's a big number left of that other comma, believe me. But it's just efficiency, it's best practices, it's process.

Anyway, I appreciate the opportunity. I'm very happy with The Blue Square Method. We wrote The Advisor Playbook; that came out in 2015, so it's seven years now of us interacting with some of the best people in the business. We've captured that in terms of also the evolving mindset, not just the best practices. People can read a sample chapter on that bluesquaremethod.com website to get a sense for what we're talking about, but I'm very happy with that book.

Mike Langford:

Well, this has been absolutely fantastic. Thank you so very much for sharing time with us today. We're going to make sure we get all the links we talked about on the show notes. We're also linked to your podcast. You had Katie on your show, so we'll make sure we get that linked up. Where else can people find you if they're looking to connect with you and make sure that they can follow all the stuff you're up to?

Duncan MacPherson:

Thanks for that. I adore Katie, I've known her forever, and she's just a absolute gem, and so well-respected in this industry. Probably LinkedIn is a great place because we're very active there. Just look for me, Duncan MacPherson, I should pop right up. Make sure we also include that link. We'll give them free access to the Practice Management Index, Carve an hour out.

Mike Langford:

Perfect.

Duncan MacPherson:

Close the door, tune out the world, go through the process, and then get the reporting. I'd love to hear any feedback. Yeah, hopefully this isn't a one-and-done. I'd love to come back and go deeper if you see the merit.

Mike Langford:

Absolutely, love to have you on the show. Well, thank you very much. Glad we had you on the show.

Duncan MacPherson:

Likewise.

Mike Langford:

Thank you very much for joining us today. It was fantastic having you with us. Huge thanks to Duncan for joining us today as well. I really appreciated his guidance on growing past the plateau. You don't want to buy a business and just have it plateau, right? You're buying it for growth. Huge stuff from Duncan. Really appreciate it.

Before I let you go, if you haven't done so already, please do make sure you subscribe to The Advisor Financing Forum Podcast on Apple Podcast, Spotify, Google, YouTube, or wherever you like to get your podcast jam on, and lastly, make sure you swing by SkyView.com to learn more about your options for financing to facilitate your plans to buy or sell an RAA or independent financial advisory firm. The SkyView team is there to help. Okay, that's it for us today. We'll see you next time on The Advisor Financing Forum. See you. Bye.