It’s no secret that business continuity planning is going to be essential for your business — if not now, then in the future. It’s also safe to say that actually establishing a succession plan can be challenging, not least because it is a tall order to find someone you would trust to take over your clients.
If that is a problem for you, maybe you are not considering young-enough candidates.
Jason Peplinski, MBA, FSS, has gained much of his retirement-planning client base by acquiring practices and thus has a lot of experience with business succession. The answer to his own business continuity has come from an unexpected place: recent high school graduates.
“These young adults come out of high school with all the eagerness in the world to build their resume and be successful,” said Peplinski, a five-year MDRT member from Lincoln, Nebraska. “They’re teachable, fast and attentive. They’re an untapped resource.”
The first person like this that Peplinski found was Noah Walz, who reached out on LinkedIn looking for an internship. Previously, Peplinski had found interns through an online job site, and the people hadn’t worked out. With Walz, though, he saw a lot of himself, especially when he learned Walz read Jim Cramer’s “Mad Money” in sixth grade.
“If he could read that kind of book as a sixth-grader and then become someone with interest in investing and being a financial advisor, I knew that person could be molded,” he said.
And it’s certainly paid off. Initially Peplinski brings in high-school-graduate interns to update databases and perform a variety of day-to-day administrative responsibilities. But after a summer internship and then a year of part-time employment during college, Walz converted to full-time work with Peplinski while also taking a full slate of college courses primarily online. It’s how Walz progressed to an operations role and is now Peplinski’s long-term succession plan, despite only being in his early 20s.
“We help each other very well in areas where one has more drive or more expertise,” Peplinski said. “I can make promises that he fulfills for me. He’s like a younger duplication of me — in this business, the only way to have the capacity to take care of more clients is to multiply yourself.”
And Walz helped Peplinski do just that: A good friend and client of Peplinski used to refer people his way, saying “That’s my Roth IRA guy.” That of course seems like a good thing — everyone likes referrals.
But when that friend opened up a college savings plan for his child, he didn’t come to Peplinski. When asked why not, he said, “I didn’t know you did that.”
That’s where Walz came in, suggesting that the practice provide a printed menu of services, designed like a restaurant menu, to make sure clients know everything their advisors can do for them.
“This is something where the initial idea dropped in Noah’s lap has gone full circle because of his abilities and focus,” Peplinski said. “This is now something important to the long-term success of the firm.”
Walz has also suggested others who have thrived as interns for Peplinski, who values how these hires can provide an objective and possibly more efficient approach to his business while he focuses on client appointments. Meanwhile, these young employees are excited to contribute and rise above the competition.
“That’s what I was doing at that age too,” Peplinski said. “I was thinking about my future, which is why I’ve taken a shine to those who are motivated and determined to work on their careers early.”
5 tips for acquiring a practice
Jason Peplinski has completed two full business acquisitions. Here are some recommendations he would make to someone looking to do the same:
- Take your time in learning all metrics of the practice you’re looking to acquire. Do a full valuation and determine what your cash flow will be. Understand how a whole new client base will impact this.
- Spend time with the advisors of the practice being sold, gaining an understanding of their goals and how helpful they’re going to be once you take over.
- Make sure you know the age of the clients and the demographics involved in what they need and expect.
- Build a team to increase your business’ capacity. When doubling your clients overnight, you’ll either need to include employees of the practice you’re buying or bolster your staff ahead of time. “Nothing will make your client base upset and want to go down the street faster than if you aren’t able to take care of them and service them the way they’ve grown accustomed to,” Peplinski said.
- Know your seller and be flexible. Sometimes the anticipated changing of the guard at the practice you acquire may take longer than expected.