An adviser resigning during a sale process is not a staffing problem. It is a pricing event. The buyer is paying a multiple of recurring income, and recurring income accounts for over 80% of offers on Gunner & Co's figures, so what is being bought is the continuation of relationships. If the person holding a block of those relationships leaves, the buyer's assumption about how much of that block survives changes immediately, and so does what they will pay.
This is why adviser retention belongs in the deal conversation from the beginning rather than in a separate folder marked people.
What the buyer is actually assessing
Three questions, whether or not they are asked in these words.
Who holds each relationship? If the answer is that the owner holds all of them, the firm is more fragile than its income suggests and the handover is longer. If the answer is that four advisers hold them across defined segments, the buyer needs those four.
Are they staying? A buyer will want to know, by name, which advisers are expected to transfer and on what basis. Vagueness here is priced.
What happens to their clients if they go? This is the question behind the other two. An adviser leaving with no restrictions and a warm client list is a direct threat to the income being purchased.
The sequencing problem
There is a genuine conflict at the heart of this and it is worth stating plainly rather than pretending it resolves neatly.
You cannot secure an adviser's commitment without telling them the firm is being sold. Telling them creates the risk that they leave, or talk. Not telling them means arriving at completion with an unsecured key person and a buyer who has priced that uncertainty.
The workable answer is staged disclosure with the key advisers brought in early and under a written confidentiality undertaking, which is set out in telling your staff. The commercial argument for early disclosure is stronger than the HR one: an adviser who has been treated as a principal in the process, given time, and allowed to negotiate their own position calmly is a reassurance to the buyer. An adviser who finds out late, from a rumour, is a risk the buyer will discount for.
What actually keeps people
Money helps and is rarely the deciding factor. In roughly the order that matters:
Being told early, by you, in person. The single largest determinant of how an adviser reacts is whether they heard it from the owner or from someone else. This costs nothing and cannot be retrofitted.
Knowing what happens to their clients. Advisers who have spent fifteen years building relationships care what those clients will experience. A buyer with a coherent answer about service, fees and continuity is far easier to stay with than one who talks about synergies.
Knowing who they will report to, and having met them. Abstract new ownership is unsettling. A named person who has visited the office is not.
Their own terms, in writing, before completion. Role, remuneration, location, and what happens to any existing arrangement about client ownership or income share. If an adviser currently has an informal understanding with you about their book, it needs converting into something explicit, because informal understandings do not survive a change of ownership and their disappearance feels like a betrayal by you rather than by the buyer.
A retention arrangement, if it is genuinely additive. A payment for staying a defined period can work. It works badly when it is the only thing on the list, because it tells a wavering adviser exactly what their departure is worth.
What the structure does to this
If you sell the shares, the employing company does not change and contracts continue untouched. If you sell the business and assets, TUPE applies: employees assigned to the business transfer automatically on their existing terms with continuity preserved, and the buyer cannot use the transfer itself to dismiss them or worsen their terms. The structural choice is covered in asset sale or share sale and the mechanics in telling your staff.
The point for retention is that TUPE protects terms; it does not protect willingness. An adviser can transfer with every contractual right intact and resign a fortnight later. Legal continuity is not the same as commitment, and buyers know the difference.
Self-employed advisers and appointed representatives
If some of your advisers are self-employed, or the firm operates within a network arrangement, the retention question changes shape. There may be no employment to transfer, the client relationship may be documented differently, and the answer to "who owns this client" may be less settled than everyone has assumed while things were going well.
Establish this before diligence rather than during it. A disputed answer about client ownership discovered by a buyer is worse than a difficult answer disclosed early, and the FCA is explicit that the client bank is the firm's asset and that claims that someone else owns it need proof.
The failure mode to avoid
The common pattern is an owner who protects the deal by telling nobody, reaches exchange, announces it, and discovers that the two advisers holding half the recurring income had been quietly interviewing for a month because they could see something was happening and drew their own conclusions.
Nothing about that outcome required bad faith from anyone. It required only silence held past the point at which silence was credible. The FCA's consolidation review notes that poorly managed integration risks poor consumer outcomes; poorly managed disclosure risks the deal itself, and it is the part entirely within your control.
Adviser concentration is a valuation factor in its own right
Buyers assess concentration in the client bank as a matter of routine: a firm whose income depends heavily on a small number of clients is worth less than one where it is spread. The same logic applies to advisers, and it is assessed less openly.
If one adviser other than you holds a large share of the recurring income, that adviser is a single point of failure the buyer is being asked to pay for. The discount is not usually itemised. It appears as a lower multiple, a larger deferred element, or a longer retention period, and the reason given will be something more diplomatic than "we are worried about your senior adviser".
You can see the scale of what is at stake by running your recurring income through this site's free IFA valuation calculator, which produces a range rather than a figure precisely because factors like this move a firm within it. The gap between the top and the bottom of that range is, in large part, what the answers to the three questions above are worth.
Two things reduce the exposure, and both take time, which is why this belongs in the preparation phase rather than the sale phase.
Spread the relationships deliberately. Joint meetings, second advisers on larger clients, a servicing model where more than one person is known to the household. This is slow, unglamorous, and the single most effective thing a firm can do to make itself easier to buy.
Document who services whom. A buyer can only credit what you can show. A clear map of adviser to client to income, reconciled to the income schedule, converts a vague worry into a known quantity, and known quantities are discounted less than unknown ones.
The question to answer before diligence starts
Ask yourself, honestly: if my two most important advisers resigned the week after completion, how much of the recurring income would still be here in a year?
If the answer is most of it, you have an institutional client bank and you should be able to demonstrate that. If the answer is that you genuinely do not know, the buyer does not know either, and they will price the uncertainty rather than ignore it.
That question is also the one that makes the case for early, careful disclosure to the people who matter. The alternative to bringing them in properly is not keeping the sale secret. It is arriving at diligence with the most valuable relationships in the business held by people who have worked out that something is happening and have not been told what.
Read next: telling your staff, clients who will not move, and the rest of the people and clients pillar.