Financial Advisor Success
Ep 406: Exiting To A Perpetual Purpose Trust To Facilitate Internal Leadership Succession Without Indebting G2 Advisors with Michael Kramer
Oct 8, 2024
Michael Kramer, Manager of Natural Investments, shares insights on their unique use of a perpetual purpose trust for succession planning. He discusses how this structure allows ownership monetization without debts for future advisors, promoting accountability through roles like 'trust enforcer.' Kramer also delves into building a values-driven practice and fostering a collaborative environment. He emphasizes the importance of equitable governance and the potential for high payouts, alongside his journey of attracting clients through impactful public speaking.
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Quick takeaways
- Michael Kramer's firm utilized a perpetual purpose trust structure for leadership succession, avoiding financial burdens for incoming advisors.
- The equitable profit-sharing model at Natural Investments empowers all advisors equally, fostering inclusion and shared leadership within the organization.
Deep dives
Innovative Succession Planning
A unique perpetual purpose trust structure allowed Natural Investments to navigate the complexities of succession planning without putting financial burdens on the next generation of advisors. This model enabled the firm's founders to monetize their ownership stakes while providing a seamless transition to a more equitable leadership structure. By selling shares to the trust, previous owners received an upfront payment from a business loan, along with a mechanism for ongoing financial returns through earnouts. This approach not only preserved the company's continuity but also aimed to democratize decision-making within the firm.
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