The file review is the negotiation
By the time diligence starts, the price is already moving. Most of it moves on documentation.
Owners tend to think the negotiation is the conversation about the multiple. In practice the multiple is agreed early and then adjusted, and the adjustment comes almost entirely out of what the files do or do not show.
A suitability report that does not evidence the recommendation is not a small administrative problem to a buyer — it is a client who may have a claim, and it is priced accordingly.
This is the strongest argument for preparing a year out. File remediation done calmly, before anyone is looking, costs a fraction of the same work done under a chip to the price.
Firms talk about recruitment. The harder number is how many principals have no plan for the day they stop.
The rules were written for the whole market. The cost of complying with them does not scale down.
Ten clients, forty per cent of the income, and a discount you will not see coming.
Thinking about your own timeline?
Twenty minutes, confidential, and no obligation.
- A buyer, not a broker
- Confidential from the first call
- Value my practice