Turbocharge Your Growth by Targeting Business Owners

There are over 30 million small business owners in the US, making up 99.9% of all businesses,[1]which provides a very large and attractive segment of the population for financial advisors to target. And because their business typically makes up the majority of their assets and wealth, these clients and prospects have very specialized financial and investment planning issues, all of which are centered around the value of their business.

Steve Mize, ASA April 13, 2021

With the typical business owner over the age of 50[1], a majority of these clients and prospects are also approaching retirement and many need to plan for the succession of their businesses to fund their wants and needs in retirement.  The challenge is that many of them have not planned. According to Deloitte[2], only 1 in 4 privately held businesses have some form of a formal succession plan, creating a tremendous opportunity for financial advisors to be able to add value by addressing this issue.

Additionally, there are many other business planning concerns that intersect with their personal financial plans, such as retirement and estate planning – all core areas of financial advisor expertise which makes business and operational sense to bring them all together. But where to start? Ultimately, the majority of these planning issues center around determining the value of the business. 

However, because small businesses are privately or family owned, it can be difficult to determine an accurate value without going through a formal valuation process. And because these formal valuations can be time-consuming, expensive and complex, most business owners haven’t sought them out. According to Forbes[3], less than 40% of owners have had a formal valuation in the past three years. Additionally, the recent pandemic most likely has had a big impact on small businesses, influencing their business value – all of which will increase demand to better understand where they stand and what their business is worth.

The key takeaway here is that for financial advisors who can develop a specialty in serving business owners, they can create a powerful growth engine in their practices. And one great way to turbocharge this growth strategy is to become a go-to resource for business valuations.

Where to start?  

Check out FinVal, our new, technology-enabled platform to quickly generate business valuations. This platform has been customized for financial advisors to support client-advisor relationships as an easy way to access valuation services that are intuitive and quick to develop a comprehensive valuation in 15 minutes.  These reports provide a a comprehensive valuation analysis via a 15-page report that has over 100 valuation factors included along with 3 valuations provided based on market, asset and income methodologies from over 20,000 comparables. In addition, gain access to experts in valuation, M&A, business brokers, SBA lenders and more to position advisors as the go to resource for business and exit planning implementation steps.

[1]https://www.fundera.com/blog/small-business-employment-and-growth-statistics

[2]https://www.washingtonpost.com/news/on-small-business/wp/2017/02/28/a-great-majority-of-our-nations-small-business-owners-are-old-white-men/

[3]https://www2.deloitte.com/content/dam/Deloitte/us/Documents/deloitte-private/us-dges-business-succession-planning-collection.pdf

[4]https://www.forbes.com/sites/sageworks/2017/02/05/these-8-stats-show-why-many-business-owners-cant-sell-when-they-want-to/?sh=5c299c9644bd