New service is a result of demand from Genworth advisers who are looking for help either to sell or expand their practices.
Genworth Financial Wealth Management Inc. today launched a business transition service geared toward helping advisers who are looking to grow through acquisitions, or set up succession plans and ease into retirement. Genworth is teaming up with The Bancorp Bank to offer financing for those changes to advisers on its platform.
The new service is a result of demand from Genworth advisers who are looking for help either to sell or expand their practices.
Industry statistics show there are 50 buyers for every adviser looking to sell his practice, said Matt Matrisian, senior vice president and director of practice management. “It's still a sellers market,” he said.
Advisers seeking to retire want help extracting some of the equity and assets out of their firms, which are essentially small businesses, said Mr. Matrisian. “The average adviser is in their 50s. They're looking to transition and slow down over the next 10 years,” he said.
On the flip side, advisory firms in growth mode are increasingly seeking to build via acquisition, pushing demand.
The business transition service will make it easier for advisers to obtain funding than if they went to a traditional bank, Mr. Matrisian said.
“Banks have a hard time lending to advisers because it's tough to collateralize their business. It's not like a house or a car. What you're really selling is the client relationships and the revenue streams that are generated from them,” he said.
To help advisers prepare for a merger or acquisition, Genworth has four regional practice management consultants it brought on board in mid-2011.
