Investing in People



by Alan N. Walter

These are mere business relations …; there is no friendship in them, no particular interest, nothing like sentiment …. Charles Dickens, A Tale of Two Cities

In spite of the recession, this may be the time to form new relationships, to bring in that new person and expand your business.

The financial markets are in crisis. Assets under management have fallen and asset management firms are failing. What’s an advisor to do? Invest with wisdom …in people. (And buy low, of course.)

Declining AUM can mean declining valuations of investment advisory firms, declining fees and the inability of certain advisors and representatives to make it on their own. This may be the perfect opportunity to acquire another firm or pick up a new representative or two, to create new internal business relations.

I am hopeful that Mr. Dickens is wrong, that the new relations will be “mere” business relations without friendship or sentiment. But still, it pays to prepare for the worst and hope it never comes to pass.

This article concentrates on the commercial issues to consider when bringing on a new partner or representative. It does not address any regulatory considerations that may arise.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Alan N. Walter, Counsel | Attorney Advertising

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