ValidPath has rolled out a “succession solution” for independent financial advisers (IFAs) as an alternative to the structure of advice consolidators.
The solution facilitates the sale and purchase of IFA firms and helps selling IFAs to access liquidity and retire on their terms, while empowering the next generation of ‘successor’ advisers to become business owners.
The ValidPath Succession Solution supports both single and multi-adviser firms, as well as appointed representative or directly authorised firms, with ValidPath managing the entire process from feasibility to due diligence, valuation determination to commercial terms, transaction structure to completion documentation, and the transition plan with ‘successor managers’.
All finance will be provided and all ongoing deal administration is managed.
The IFA network said that, for IFAs that value independence away from private equity consolidators, a “new approach is needed to support those seeking to retire in the years ahead and the next generation to become business owners”.
It added: “Making this happen in-house can be difficult, disruptive and time consuming for the firm, brokers may be unaligned and financing unavailable or prohibitive such as requiring personal guarantees. Alternatively, engaging with an IFA consolidator may be unappealing, especially if platform and product consolidation is core to their business model and the needs of clients and the aspirations of staff is not always a priority.
“It is clear that there needs to be an alternative, and ValidPath has launched the ValidPath Succession Solution to be just that.”
‘Independence is everything’
Angus MacNee, chief executive of ValidPath, said: “ValidPath has been supporting IFAs for over 20 years, and it became apparent that a new approach to exit and succession was required to support the objectives and aspirations of IFAs that resonate with the core values of independence and independent financial advice.
“As an industry we need to support the next generation, and when you look at the alternatives in the marketplace, they are almost entirely vendor-focused and don’t empower the ‘successor managers’ to create value for themselves or offer piecemeal support that is transactionally focused and often self-serving.
“We have packaged a complete ‘turnkey’ solution that is entirely independent, fully funded and where we manage the entire process. That is why I am so pleased to bring the ValidPath Succession Solution to market after 18 months development for ValidPath and the IFA community.
“After all independence is everything, and we believe that independent financial advice is as important today, as it will be tomorrow.”