Giving employees an ownership stake

Coming up with a way to give employees an ownership stake in an advisory firm helps retain and attract top talent and can be the first step in creating a succession plan. Here are steps to take to achieve that goal: • Identify key employees who could be part of a new ownership team. • Approach targeted employees to see if they are interested in an ownership stake and willing to take out a loan, if necessary, to finance their stake. • Arrive at a mutual decision on how the value of the firm will be calculated. (More: An inside job: Advisers are picking, grooming successors from within) • Determine ways employees can finance their part of the purchase, possibly with the help of the firm. • If part of a succession plan, figure out a timeline to transfer complete ownership to the new team.