An Exploration of the Relationship Between Financial Advisors and M&A

By Exit Planning Institute
Published: September 24, 2023 | Last updated: March 22, 2024
Key Takeaways

The article underscores the symbiotic relationship between Financial Advisors and M&A Advisors, emphasizing the importance of harmonizing business, personal, and financial objectives for successful business transitions. Effective communication, role clarity, and a comprehensive approach are key in navigating the complexities of such transactions. Business owners benefit most when these professionals collaboratively address both immediate transactional needs and long-term financial goals.


M&A Advisors work on what is arguably the most significant financial transaction in a person’s life: the sale of their business. As a member of a business owner’s advisory team, are you prepared to work with a diverse group of advisory professionals to create the most value for your clients? How do Financial Advisors and M&A Advisors collaborate in deal-making processes?


James Jack, Managing Director, Head of the Business Owners and Multigenerational Client Segments at UBS Financial Services, Inc., shares, “Collaboration begins by ensuring that the client's personal financial goals align with their M&A strategy. The Financial Advisor works to understand how an M&A transaction might impact the client's financial position, estate planning, and other financial matters. M&A Advisors can take these personal financial considerations into account when developing an M&A strategy and when targeting potential buyers.”

Explore the dynamic partnership between M&A Advisors and Financial Advisors, and uncover the strategies and collaborative approaches that drive the business owners' advisory teams toward a successful transaction.


The Role of the Financial Advisor in M&A Transactions

A Financial Advisor plays a key role on an M&A team or exit planning team. As the Financial Advisor gets a portion of their earnings when the business sells, the more valuable the business is at the time of the transaction the more beneficial for the advisor. Therefore, the Financial Advisor must work collaboratively with the M&A advisor to ensure the business owner achieves the highest business value before the exit event.

James Jack says, “Financial Advisors look at all aspects of a client’s wealth journey, they typically will align with clients on their short/long-term financial goals and discuss strategies on the investment and planning side that can be leveraged to help reach the goals for a founder and their family. Frequently, the Financial Advisor and M&A Advisor will work together to marry the transactional goals with the longer-term financial objectives of the founder and their family.”

According to recent research conducted by Exit Planning Institute, business owners name Financial Advisors as their most trusted advisors. As such, it is the responsibility of the Financial Advisor to identify potential M&A opportunities that could benefit their clients and engage with M&A Advisors to explore these opportunities further.


James continues, “In order to help identify potential opportunities, it is important to be well-informed about the client's industry and related sectors and to establish relationships with M&A professionals. It’s important to bring in M&A advisors with expertise in executing sale transactions to ensure that all key deliverables are being managed—and any opportunities to maximize proceeds or mitigate challenges are being addressed.”

The Personal Aspect In Business Transactions

Proper exit plans incorporate the business, financial, and personal goals of the business owner. All three of these are equally important for a successful business transition. Through the Value Acceleration Methodology, owners can balance these goals for a significant exit.


75% of owners profoundly regret selling their business within one year of the transaction due to a lack of a well-constructed personal plan containing their purpose and core values. The personal goals should drive the business, not the other way around. Getting in touch with personal goals and purpose helps to build a successful and growing business. The process for exiting is driven by a wealth goal. The wealth goal is motivated by what the business owner wants personally in life, both now and after the sale of their business.

Creating and maintaining updated Personal Financial Plans, estate plans, and tax plans are essential for one’s personal financial strategy and mitigation of personal financial risk. James shares, “A Financial Advisor’s primary focus is on optimizing a client's overall personal and financial situation, including investments, taxes, estate planning, personal planning, and more. On the other hand, M&A Advisors are more focused on deal structures, valuation, negotiations, and integration strategies. Balancing these differing objectives can lead to conflicts if not managed properly.”

Effective Communication With Other Advisors

Business professionals undoubtedly work with numerous teams throughout their careers. Whether they are leading a team in their practice or working on an owner’s advisory team, the team’s strength can be measured by the effectiveness of the communication between team members. When each member of a team is not aligned with or passionate about the same goal, communication can break down.

James explains, “M&A deals often have tight timelines and critical milestones while financial planning is a long-term process that requires careful consideration. Balancing the urgency of deal execution with the need for thorough financial analysis can be challenging. Therefore, it is important for the two advisors to communicate regularly and define clear project timelines that incorporate both the immediate M&A requirements and ongoing financial planning.”

According to a McKinsey report, well-connected teams see an increase in productivity by 20-25%. This increase in productivity among advisors on an owner’s exit planning team can ultimately lead to improved business value. While communication within an owner’s business is a large component of their business value, the communication among members of an owner’s exit planning team can lead to improved business value as well. If the advisors do not communicate strategies, next steps, and timelines, they risk missing important steps in an owner’s exit strategy.

James states that for M&A professionals and Financial Advisors to best work together they must, “Define the roles and responsibilities of each advisory team, including legal, financial, operational, and strategic advisors. Clearly outline who is responsible for what aspects of the transaction. Create a comprehensive project plan that outlines the entire transaction process and details key milestones and deadlines. Schedule regular status update meetings to review progress, address challenges, and ensure that both teams are aligned.”

Educating Owners On The Importance of Cross-Functional Advisory Teams

Accountability is the backbone of any successful team. On an owner’s team, advisors must work collaboratively to manage the owner’s business, personal, and financial goals. Business owners who surround themselves with a holistic team of advisors and professionals will be more successful in their transition. Whether that be a sale to a third party, private equity, a family transition, or any other exit option. The Financial Advisor will ask all the pertinent personal and financial questions to the owner. They remain on the owner’s team long after the exit has occurred.

James states, “Financial Advisors are not only supporting the client’s personal financial plan but also their business plan and ultimate exit plan. They help clients align M&A strategies with broader personal and financial goals and help to identify value-enhancing opportunities. Financial Advisors will need to build strong relationships with M&A professionals and stay up to date with the current M&A trends to support their clients.”

M&A Advisors are typically used if the business owner is going to sell to a third party, considered sell-side work. That third party could be a strategic corporate, financial buyer, private equity group, or public offering. They can also help their client raise money or work on the buy side. They position the company for sale, managing the entire M&A Process including deal preparation, negotiating terms and price of the acquisition or merger, and arranging the sale of the company itself. These advisors can also be brought into the process early, before a sale, to give additional advice to the owner who may be thinking about a third-party sale in the longer term.

James expands on this by saying, “A successful M&A Advisor should have deep industry knowledge and understand the specific dynamics, trends, and challenges relevant to the client's sector. It is also important for them to have strong communication skills to be able to negotiate a deal and to build relationships with potential buyers and investors. It is also important for an M&A Advisor to have project management skills in order to effectively navigate the key stakeholders and milestones throughout the transaction process.”

In summary, the success of business transactions hinges on the effective partnership between Financial Advisors and M&A Advisors. When these professionals work in harmony, they can navigate the complexities of M&A transactions, ensure that personal and financial goals are met, and ultimately lead business owners toward successful and significant exits and transitions.

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Exit Planning Institute
The Exit Planning Institute, provides Financial Advisors, Accountants, Consultants, and other advisors of business owners with the crucial education to differentiate themselves, add value to their existing client relationships, and attract new business owners to their firm.

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