Where the Money Is

wherethemoneyisEditor’s Note | Private Wealth | Jul-Aug 2014

Notwithstanding Willie Sutton’s rationale for robbing banks, elite practitioners—advisors who are leaders in client satisfaction, longevity and profitability—know the real money is with business owners.

There are many paths to wealth, but the most common and reliable method is to own a business. The struggles, complexities and risks associated with launching, managing, growing and eventually transitioning a business can be exceedingly difficult, which helps explain why the failure rate is so high. But the rewards, when they do happen, can be extraordinary. The sheer number and range of issues that a business owner faces can thwart even the smartest and hardest-working of entrepreneurs. Enter the elite practitioner.

When we compare the practices of the top 10% of advisors against their peers, it’s easy to see why they’re successful. This small group of professionals is more likely to specialize in working with a particular type of client instead of assuming the default position of a generalist accepting whatever type of opportunity walks through the door. The vast majority of elite practitioners, roughly nine out of 10, focus their efforts on family-owned and privately held businesses rather than wealth holders such as corporate executives, retirees, physicians and inheritors.

The reasons for this are clear: Businesses, whether they’re owned and operated by a family or closely held by a small group of stakeholders, and their respective leaders need guidance and problem solving through a wide variety of situations that can span from milestone achievements to catastrophes and that include plenty of opportunities for garden-variety planning.

That’s another reason it helps to have access to a broad range of capabilities. Business owners need help with everything from financial planning and asset protection to lines of credit and risk management, from retirement planning and executive benefits to tax mitigation and trust services, from investment banking assistance to all forms of insurance and much, much more. Not to mention the other range of services that have less to do with the immediate financial well-being of the owners but which can contribute to the overall soundness of the business and it’s ability to grow, services such as IT, training, marketing, sales, manufacturing, recruiting and talent development, communications, intelligence and accounting, just to name a few.

Business owners are the backbone of free enterprise, the engine for sustainable wealth creation and, at their very essence, offer a foundation for elite practitioners and other advisory professionals who want to build deep, lasting and mutually profitable relationships with top-tier clients.

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