Norman Boone, the 65-year-old founder and president of Mosaic Financial Partners Inc. of San Francisco, isn't convinced that his successor will emerge from his 16-person staff. So he has embarked on a search as difficult as finding a spouse.
One of the succession strategies that Mr. Boone's firm, which manages about $500 million in assets, is pursuing involves an acquisition or merger.
“You're effectively talking about a marriage here,” he said. “Is it someone you would want to marry?”
Just as men and women make lists of what they're looking for in a mate, Mr. Boone has come up with a set of criteria.
First, he assesses a potential candidate's professional proclivities. Because Mosaic stresses financial planning, “someone who is just interested in investment management would not fit well here,” Mr. Boone said.
In addition, he's seeking someone who is comfortable being part of a team, rather than calling all the shots. Mr. Boone also wants someone who is willing to be involved with the community, as well as in professional organizations such as the Financial Planning Association.
QUID PRO QUO
“I value people who give back,” he said.
Perhaps the biggest challenge is finding someone who is willing to fold their firm into his.
“Once you're an entrepreneur, you like making decisions,” Mr. Boone said. “You're afraid to give up your power and control. People get spoiled running their own firms and making their own decisions.”
Mr. Boone has enlisted boutique investment banking firms and headhunters to help him find that elusive merger partner.
“There aren't many of them around,” Mr. Boone said.
The hunt has been time-consuming because, as when searching for a mate, Mr. Boone is seeking a long-term commitment.
“We want to do this as quickly as we can but as slowly as it takes to get this right,” he said.
Ideally, Mr. Boone would like to find a successor in-house. But the internal candidates are five to 10 years away from being ready.
“It's not clear that any of the people we have here today are ready for it,” Mr. Boone said. “We're looking externally to see if anyone is able to do that sooner.”
Even as he seeks a merger partner, Mr. Boone is working with members of his staff to build traits that would make them future chief executive candidates.
“Internally, we're actively mentoring and trying to get people to develop their leadership skills,” he said.
Wherever the next CEO comes from, he or she will have to place an emphasis on talent development.
“Our leader of the future needs to be someone who is equally good at internally mentoring other people,” Mr. Boone said.
Building the strength of the staff is as important as enhancing the firm's reputation, nurturing client relationships and bolstering its technology and systems backbone.
“You have to be doing it all along the way,” Mr. Boone said. “It needs to be part of your culture, your essence. It has to be seen as part of your DNA.”
Mr. Boone would like to devote more time to travel and his work with local nonprofits as he phases himself out of the top position at Mosaic.
“My ideal would be to do this for another 10 to 15 years but at a lesser and lesser percentage of my time,” he said.
But in order to maintain that trajectory, he has to have someone at the helm who will ensure that the firm doesn't skip a beat in his absence.
“When I [am away], there's a different environment than when I'm here,” Mr. Boone said. “If you have the right leadership in place, those differences get minimized over time.”
“When you build a business that has value, it has to have value beyond you,” Mr. Boone said. “Otherwise, it's not valuable to anyone but you.”
By planning for his firm's future, Mr. Boone is trying to practice what he preaches to clients.
“We think of ourselves as being part of the planning profession, but most of us don't do a lot of planning,” Mr. Boone said. “My question to my industry is: Why don't we do it ourselves? My firm is trying.”
mschoeff@investmentnews.com Twitter: @markschoeff
