Getting the Terms Right to Maximize Success

So, you’ve found the perfect advisory business to acquire — client fit looks great, culture aligns, and the numbers check out. Now comes the most critical part: structuring the deal.

The structure of your acquisition can make or break the success of the entire transaction. A well-structured deal balances risk and reward, sets expectations clearly, and creates a path for smooth integration. At OneSeven, we guide advisors through this phase with proven strategies and insights to ensure each deal is built for long-term success.

Here are some best practices to keep in mind when structuring a financial advisory acquisition:

1. Understand the Deal Components

Every acquisition deal is made up of a few key components. Knowing how to structure each one gives you greater control and flexibility:

• Purchase Price: Typically based on a multiple of revenue or EBITDA, adjusted for factors like client demographics, retention rates, and profitability.
• Payment Terms: Deals can be structured with upfront cash, seller financing, earn-outs, or a combination. Structuring payments over time can reduce your risk and incentivize the seller to support a successful transition.
• Retention Clauses: Tying a portion of the purchase price to client retention over a defined period ensures alignment between buyer and seller.
• Employment Agreements: If the seller plans to stay involved post-sale, define their role, compensation, and timeline clearly.

At OneSeven, we help advisors evaluate all components of the deal to ensure they’re getting the right value while minimizing risk.

2. Use a Tiered Payment Structure

A tiered payment model — such as a combination of upfront cash and performance-based payments — is a common and effective approach in the financial advisory space. Here’s why:

• It protects the buyer by tying payments to client retention and revenue targets.
• It motivates the seller to remain engaged and support client transitions.
• It spreads out the financial burden of the acquisition.

For example, a deal might include 60% upfront and 40% paid out over two to three years based on client retention benchmarks. This structure provides flexibility and incentivizes success for both parties.

3. Plan for Integration Early

Deal structure isn’t just about dollars — it’s about people, processes, and expectations. Build the integration strategy into the deal itself by including:

• A defined transition plan
• Client communication strategy
• Onboarding timelines for new staff, systems, and clients
• Clear deliverables and responsibilities for both buyer and seller

When OneSeven supports acquisitions, we help advisors align on integration from the start to avoid disruptions post-close.

4. Get the Legal and Tax Pieces Right

Even the best business deal can fall apart if the legal and tax implications aren’t fully understood. Be sure to:

• Work with legal counsel experienced in M&A for RIAs and advisory firms.
• Consider whether you’re buying assets or equity — each has different legal, tax, and liability consequences.
• Address non-compete and non-solicit clauses to protect the value of the acquisition.
• Review licensing and compliance requirements for transferring client relationships.

We regularly help our advisors navigate these nuances and connect them with specialized legal and tax partners when needed.

5. Prioritize Transparency and Trust

Last but not least — successful deals are built on trust. Open communication, aligned expectations, and mutual respect create a collaborative, productive process.

From setting realistic timelines to agreeing on key terms, clarity goes a long way. At OneSeven, we act as a trusted partner throughout the deal process to help advisors stay aligned, focused, and prepared at every stage.

Final Thoughts

Acquiring another advisory firm is one of the most powerful ways to grow your business — but only if the deal is structured thoughtfully and strategically. With the right terms, the right support, and the right plan, you can set your firm up for long-term success and scalability.

Thinking about your next acquisition? Let OneSeven help you build a deal that works. From sourcing opportunities to structuring deals and supporting integration, we’re here to help you grow with confidence.

 

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