Bowing Out Gracefully

No one likes to be turned down.  You may be turned away from a firm and you will be rejecting firms during your due diligence.  As tempting as it may be to recite a litany of the firm’s shortcomings, keep your comments brief.  Not only may you want to speak with that firm at another point in time, but the manager will likely move firms at some point and may be in a position to impact your career in the future.

Depending where you are in the process, the harder and longer the conversation will be.

After an Initial Meeting
This is a relatively easy conversation.  State simply and politely that you have elected not to move forward with that firm.  If pressed, you can outline some key points but end the conversations on a positive note.

After Product Meetings or After Visits to HQ
Be sure to recognize the time and expense that the firm has invested in speaking with you up to this point.  Here, if pressed, you can mention you are putting your search on hold for a few months to concentrate on your business or if the firm truly cannot support your business you can mention some platform components.  Again, thank them for their time and end on a positive note.

After Getting a Deal
We strongly recommend not rejecting a firm in the deal stages until you have moved to your number one firm.  We have seen deals fall apart at the last minute for a myriad of reasons, management changes, firm acquisitions, you name it.  It is much easier to call them after you have moved than to call them and ask to have your deal reinstated.  You want to slow the process down dramatically with these firms.

After You Have Moved to Another Firm
This is the most difficult conversation.  This is when most Advisors wish they had a consultant to do their dirty work.  Only after you have moved firms AND you are sitting at your new desk, can you call the losing firm and outline the key areas where your new firm took the lead.  Anything short of this plan is a confidentiality risk.  The losing firm will want to know details around the deal, platform, etc.  Depending on how long your search was and how much time you spent with the losing firm, you may want to allocate time to have dinner to close the loop and be sure that there are no burnt bridges.  Remember, “Not only may you want to speak with that firm at another point in time, but the manager will likely move firms at some point and may be in a position to impact your career in the future.”