Planning to be around the table whole day


Sarah Daya

Executive Director, Wealth Planning and Advice

The first step to a successful business succession plan is building an effective team of professionals. Much of a business owner’s wealth is often tied to their business and their ability to monetize that wealth is likely to impact their financial security and lifestyle. A thoughtfully recruited cross-functional team may increase the likelihood of a successful succession plan, whether it involves a sale or another exit from the business for the owner.

This team will typically be comprised of the owner, a financial advisor, a certified public accountant (CPA), attorneys (business and estate planning), a business valuation professional, insurance and risk advisors, and investment bankers and/or business brokers. The team should also include key members of the owner’s family as well as certain key members of the business’ management team. Each person on the team plays a critical role in assisting the owner get to the finish line.

Financial advisor

The financial advisor can play a crucial role in the process and can act as a quarterback for the client by helping bring together various resources to support the transition. A financial advisor can help business owners think through their financial goals, how the succession event may impact the feasibility of those goals, and how those goals may change after the sale of the business. A financial advisor can be instrumental in providing guidance on investment strategies to support the long-term financial goals of the owner, and will remain on the owner’s team long after the business transition.


The owner’s CPA can offer expertise and guidance in tax planning, financial analysis and compliance. CPAs can provide advice and tax-efficient strategies before, during and after the sale process. The CPA can analyze the financial health of the business and can identify potential areas for improvement, which ultimately help determine the fair market value of the business. The CPA can ensure that any succession plan complies with relevant tax laws, regulations, and accounting standards and also helps the business owner comply with all reporting requirements associated with the transaction. In addition, CPAs can conduct financial due diligence to evaluate financial risk and opportunities associated with the succession plan. A good CPA can help ensure a smooth transition of ownership while optimizing financial outcomes and minimizing overall tax implications.


Multiple attorneys will likely be part of the team and have different areas of expertise. Two of the most common attorneys on the team will be a business attorney and an estate planning attorney.

  • Business attorneys will provide legal expertise and guidance throughout the transition process. Sometimes the business’s general counsel acts in this capacity; other times the company hires outside counsel. Regardless of whether they’re from inside the business or not, a business attorney can help owners design and structure the legal documents that bring to life a succession plan that aligns with the owner’s goals and objectives. The business attorney drafts and reviews all legal documents necessary for the succession plan to be effective, which may include buy-sell agreements, shareholder agreements, partnership agreements, purchase and sale agreements, etc. The business attorney works with the CPA and financial advisor to develop a tax-efficient strategy that is in line with the client’s financial goals. One of the most important roles of the business attorney is to assess and address the legal risks associated with any succession plan. This includes addressing potential disputes among stakeholders, regulatory compliance issues, and creditor claims. The business attorney is also responsible for facilitating the negotiations between the parties involved and ensuring the terms and conditions of the succession plan are clearly defined and legally enforceable.
  • The estate planning attorney focuses on the wealth transfer opportunities afforded by a transition or succession as part of the business owner’s broader estate plan. The estate planner works closely with the other members of the team to develop a plan that takes into account family dynamics, transfer tax implications, sometimes income tax implications, asset protection strategies and the owner’s overall wealth transfer goals. Often an estate attorney will consider various estate planning strategies and structures, such as valuation discounts, the use of transfer tax exemptions, trusts, LLCs and/or partnerships and sometimes charitable giving to fulfill philanthropic objectives and also to reduce potential income tax as well as estate and gift tax, consistent with the owner’s objectives for his or her family and legacy. A key role estate planning attorneys play in the process is addressing family dynamics. A succession plan can evoke a number of emotional responses from the owner and the owner’s family. There can be conflicts and complexities that arise because of a failure to communicate or misunderstandings around the purpose of the plan; an estate planning attorney, in conjunction with other team members, can help the family navigate these challenges and help facilitate effective communication to increase the likelihood of a smooth transition.

Business valuation professional

The business valuation professional is the person on the team who helps determine the fair market value of the business. There are various methods used to establish value; the method they use will be based on the type of business they are valuing. They work closely with other members on the team to analyze financial statements, industry trends, market conditions and other relevant factors to determine a valuation, which helps set the sales price for the business. They will also assist the estate planning attorney in valuing the business for estate tax purposes.

Insurance or risk advisor

Many of the risks associated with the transition of ownership of a business can be addressed through legal structuring (via the business or estate planning attorney) or through other planning (e.g., business continuity, disaster recovery), but some require different planning. Key person risk and liquidity risk, to name just two, are often best addressed through sophisticated insurance strategies. Working with other team members, a risk manager may also help business owners develop contingency plans to address unforeseen events or disruptions that could impact the succession process.

Investment banker/business broker

If the succession plan involves a sale of the business, the investment banker or the business broker will usually help facilitate that sale. They will be responsible for evaluating market conditions, industry trends, and other comparable transactions to determine the optimal time for bringing the business to market, and will work with the business valuation expert to determine an appropriate pricing strategy. They will market the business to potential buyers or investors and prepare materials such as an offering memorandum, presentations to highlight the business’s strengths, and other relevant information to solicit offers from qualified purchasers. They advise on various deal structures such as asset sales, stock sales, mergers, acquisitions, and the consequences of each type of structure, and negotiate the terms and conditions of the transaction on behalf of the owner. They also coordinate the due diligence process between the buyer and the seller to ensure that both parties have access to the necessary information and documentation to evaluate the transaction.

Family members and key employees

Everything an owner does directly impacts his or her family, and a succession or transition plan will almost certainly have impacts across the family. Similarly, the sale of a business will almost certainly affect the employees of that business. Even if they aren’t owners, senior management can be helpful as the owner and his or her team work to carry out the transition strategy; communication with both the family and key business personnel can be a key to the long-term success of any transition plan.

The bottom line

Building a high functioning, coordinated team, who are all collaborating and committed to a single goal, can be challenging. Assembling this team at the inception of the succession planning process may require significant time, effort and money from an owner. The difference between a business that sells at a premium versus a business that sells at a discount, versus a business that will never transition at all can – in many cases – be directly tied to the skill and effectiveness of the team that advised the owner in the planning process. Spending time, effort, and money up front can potentially help drive more favorable outcomes in the end.

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