When your business depends on you, it's not just exhausting… It's risky! Tyson Ray and Kim Cochenour reveal the hidden traps that quietly drain your firm's value and share how real succession planning can protect your clients, your legacy, and your freedom.

You'll learn what it means to de-risk your practice, so it can run – and THRIVE – even when you're not there.

• In this episode, Tyson Ray and Kim Cochenour look at the hidden risks of what drains your value, stalls your succession, and puts your clients at risk when you aren't there.
• The concept of de-risking your practice comes from the exit planning world – it has to do with identifying and understanding perceived and known risks when you're getting valuation work done for a succession.
• Kim points out that if an advisor is thinking of succession but the business is all dependent on them, it isn't sellable and is fragile for both the advisor and their loved ones.
• Tyson opens up about the stress test the firm went through when he turned 50.
• Remember, from a valuation standpoint, if the practice can run itself (without you), it's much more valuable for potential investors.
• At the same time, the business may be more valuable to you as the owner, if you don't have to be the one doing everything.
• Tyson explains how they managed to identify gaps when he went through this process when he was 30 and, then again, when he turned 50.
• Tyson and Kim talk about letting G2 be involved enough in the business so that if the founder stepped out, they would be able to step up.
• For Tyson, approaching your firm like a medical practice – and their chart-driven approach – is an excellent way to de-risk your firm.
• A big goal should be ensuring that the trust and client relationship can be "downloaded" and transferred, then "uploaded" back to the client to make them realize that the firm knows who they are and cares about them.
• Not putting the burden on any one person is a big part of de-risking.
• Tyson goes over who owns the client, and how understanding its repercussions will impact your practice.
• There are 3 ways to jumpstart the de-risking process:
  1. review and update your operating and partnership agreements;
  2. establish what a buy-sell agreement would look like or review your current one;
  3. create a key person contingency plan that's legally documented.
• Tyson illustrates who an advisor should reach out to when it comes to specialized people in the financial services or legal counsel.
• Tyson and Kim discuss a few steps that can be taken to initiate the de-risking process.

Mentioned in This Episode:

TotalSuccession.com

TotalSuccession.com/podcast

FORM Wealth Advisors

Tyson Ray

Kim Cochenour

Tyson's book - Total Succession: 5 Steps for Financial Advisors to Exit Confidently, Be Fully Compensated, and Keep Clients' Interests First (available for pre-order)

Previous episode - Succession, EOS, and the Power of a Plan with Andrea Schlapia

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Chicago Bears

SEC – U.S. Securities and Exchange Commission

FINRA