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Sujata Kabraji built a successful HNI focused Mumbai basedMFD practice that scaled up to over Rs.450cr in AuM before deciding to mergeher practice with Scripbox’s growing wealth management business about a yearago. She takes us through the rationale and the experience of the merger andoffers advice to fellow MFDs on how to prepare your firm to becomemerger-ready.
Collaboration is the only way forward for MFDs. Margins willcome under pressure, compliance will only increase, technology is an imperativeand the need to provide high quality research based wide product suite is becomingincreasingly essential as investor expectations grow.
Merger is like a marriage – you go through an initial engagementperiod where you get to know each other and then when you get married, you haveto deal with whatever unexpected twists and turns that the marriage throws up.Having shared values is what helps you navigate this phase successfully. ForSujata, it was a shared focus on customer-centricity – always putting theclient at the centre of any issue – which helped smooth out the initial adjustmentperiod.
Since collaboration/merger is the best way forward for MFDs,you need to start thinking about how to make yourself merger ready. How do youmake yourself/your firm attractive to a prospective collaborator/buyer? Build astrong support team. Understand your margins deeper. Understand your clientbase better – which are your sticky clients who you must work closer with, whoare your clients that are best let go of to give yourself more room to bringbetter clients. Understand the levers of the negotiation process, become a goodnegotiator.
Very nice and knowledgeable
Succession Planning: The Million Dollar Dilemma for most MFDs.
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