Navigating Succession Planning That Doesn’t Turn Out As Expected (Even When You’re Doing Everything Right): #FASuccess Ep 501 With Rick Kahler

Welcome everyone! Welcome to the 501st episode of the Financial Advisor Success Podcast!

My guest on today’s podcast is Rick Kahler. Rick is the founder of Kahler Financial Group, an RIA based in Rapid City, South Dakota, that oversees approximately $300 million in assets under management for 130 client households.

What’s unique about Rick, though, is how he, despite taking all of the ‘right’ steps when it comes to succession planning, ended up having multiple false starts before eventually completing a deal with an external buyer.

In this episode, we talk in-depth about how Rick started succession planning more than a decade before he planned to transition his firm (including by identifying a potential successor, meeting with valuation consultants, and gathering the experiences of others in the advisory community), why Rick thought it was important to closely discuss the terms of the partnership agreement to ensure that he and his chosen successor were on the same page in terms of what would happen if plans went awry, and how Rick’s planned successor after several years ultimately chose not to pursue this succession path, leaving him left to start over again.

We also talk about how Rick’s second attempt at an internal succession was thwarted when a long-time employee (and planned successor) was headhunted away by an attractive salary offer, how Rick then worked with consultants to rank his succession preferences and widened his aperture for different types of potential partners, and how Rick ultimately decided on a deal with a local accounting firm he knew well.

And be certain to listen to the end, where Rick shares the challenges he’s experienced following the deal (including managing cultural differences between his firm and the buyer as well as his personal adjustment to no longer being in charge of the business), how Rick has found great value from maintaining a support network (including study groups, therapists, and business coaches) during this challenging period, and how Rick has ultimately accepted the unexpected turns that came his way on his succession path and doesn’t have regrets about the decisions that he made along the way.

So, whether you’re interested in learning about the unexpected bumps that can arise during a seemingly well-planned succession, how firm personnel (and their own career aspirations) play an important role in a founder’s succession plan, or how to build a support network that can prove valuable when times get tough, then we hope you enjoy this episode of the Financial Advisor Success podcast, with Rick Kahler.