Why I Sold – Part 2
By Jim Whiddon
March 4, 2014
Go to page 2, 3, Next
Dear Friends of the Fund, Please find enclosed our Q2 2022 investor letter for your review. Qualivian reached its four-year mark in December of 2021. We are actively weighing investment proposals. Please refer to our Q2 2022 investor letter for our performance and commentary on the second quarter of 2022. A fact sheet is
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
This article is the second installment in a multi-part series exploring the issues Jim Whiddon faced as he decided to sell his practice. To view all articles in the series, click on “more by the same author” in the left margin.
As a war-history buff, I had always done a good amount of “war gaming” in our small advisory firm. When considering whether to sell the firm in 2012, I embarked on a six-month war-game exercise to decide whether to join forces with a similarly positioned ally within our industry. With the help of my team, I performed a detailed analysis of how well-prepared the firm was for the challenges facing it.
Several key threats emerged.
Getting hit by a bus
I always knew that a sudden and unprepared absence – created by my death, illness or an accident – would put an end to my small firm. In 2003, I was relieved from jury duty because of pressing professional obligations. I stood outside the downtown Dallas courthouse and dialed my phone to call my wife and tell her. Then, whoooosh! Just one more step – literally – and I would have descended off the curb at just the instant a city bus barreled into me, making my wife an instant widow with two boys to raise. A near miss.
Unfortunately, a second “bus” did not miss us. In 2007, I lost my wife to cancer. She was a 44-year old dentist with a thriving private practice that went away overnight. From a business aspect, this tragedy magnified important questions. If something like this happened to me, what would happen to my staff? Where would my clients end up? While my family would likely be okay financially thanks to life insurance, I feared that others whom I cared deeply about would end up in far worse situations.
Even with the perspective provided by these events, my firm, like so many, still lacked a viable succession plan. An October 2013 article in Investment News stated that 67% of firms either don’t have succession plans for their businesses or have plans that aren’t ready to be implemented. I saw this issue as the core part of the fiduciary pledge I’d made to my clients. Who would take over if the unthinkable happens? Fiduciaries can’t say they don’t know, nor can they have vague answers to this question. Regulators are also rightly asking this question with more frequency.
Combining my firm with a larger firm immediately took this threat off the table. Some buses miss. Others don’t.
Display article as PDF for printing.
Would you like to send this article to a friend?
Remember, if you have a question or comment, send it to [email protected]